October jobs numbers came out on Friday and everybody was all giddy about healthy growth. But in his most recent podcast, Peter Schiff said jobs are just another bubble about to burst.
According to the Labor Department, the US economy added another 250,000 jobs in October. The unemployment rate held steady at 3.7%. Earnings took their biggest leap since 2009, rising 3.1% year on year.
Peter noted that everybody considered this a really good report, but we’re working off a pretty low bar.
Two hundred thousand jobs a month in an economy the size of ours, especially given how few people, or what a large percentage of the workforce is not working, we should be creating a lot more than 200,000 jobs per month. But we’re not.”
The rising wages in the most recent report got a lot of attention in the media. But as Peter pointed out, the increase in wages is part of a broader increase in inflation. As we reported last week, US consumers face a wave of inflation. Everything from food prices to airline fares is going up.
Even though wages are rising for people that have jobs, the cost of living is rising faster. But the cost of servicing their debt is rising even faster than that.”
Peter also said he thinks the wage increases might be fueling some of the volatility in the stock market.
Not just the wages going up, but all of the other prices going up that are driving interest rates higher. And interest rates are only starting to go up They’re still ridiculously low, and they have no place to go but up, as long as the Fed stays out. And that’s what they’re doing. In fact, the Fed is going to continue to increase short-term interest rates, which means long-term interest rates should continue to move up even faster given how much higher inflation is going to go, because we’re just getting started with inflation. We’ve barely seen what’s coming.”
Increasing prices is a direct result of a decade of Federal Reserve easy money policy. Over the last 10 years, the Fed has printed billions of dollars out of thin air.