Peter Schiff was right, right, right.

Seemingly everyone else was wrong, wrong, wrong.



They just laughed at him, even mocked him. Who's laughing now?

Despite appearances, Peter Schiff is no clairvoyant- he was only applying the principles of the Austrian school of economic thought. In one interview, he said,

I was introduced to the Austrian school early on by my father. According to my dad saying Austrian economics makes as much sense as saying Chinese physics. Austrian economics is economics, period!

Although the Austrian school isn't reknown, it has been around for some time. Austrians like Schiff predicted the Great Depression, for example. Friedrich Hayek wrote in the February 1929 edition of the Austrian Institute of Economic Research Report, "the boom will collapse within the next few months." The stock market crashed in October, but we can forgive him for being a few months eager. Much like Schiff, Hayek saw serious imbalances and knew that the "Roaring Twenties", made possible by the loose monetary policies of the Fed, were simply unsustainable.

This is surprising to many, because we are told that economists failed to predict the crash. Well, many did fail to see it- Keynes, for example. And yet it is Keynes' policies we largely adhere to today- not those of the dissenting Austrian school who are repeatedly proven correct in their assessments.

Unfortunately, that's bad news for everyone. Without the correct diagnosis, there is little chance for an effective remedy.