Peter Schiff, of Euro Pacific Capital uses illustrations, humor and storytelling to explain economic and monetary concepts in his book, How and Economy Grows and Why it Crashes. The book uses parody and analogy to compare our current global economy with a small island economy based on fishing.
Peter Schiff, of Euro Pacific Capital uses illustrations, humor and storytelling to explain economic and monetary concepts in his book, How an Economy Grows and Why It Crashes
One of the best aspects of the book is its ability to explain complex economic principles in a simplistic fashion. This allows the book to communicate to a wide range of audiences – especially novice investors. This allegorical tale sheds light on topics that are so frequently discussed but so poorly understood.
From the Back Cover of the Book
- Why governments can spend without ever seeming to run out of money?
- Why some countries are rich while others are poor?
- Whether spending or saving is the best cure for a bad economy?
- Where inflation comes from?
- Why it’s so hard to catch a fish with your bare hands?
Coming off his popular book, Crash Proof 2.0, Schiff compares the United States economy to a small island economy. He describes how an economy that was once on top of the world, is now burdened with unfunded liabilities and massive deficits. Moreover, he presents a case for the United States no longer being the engine of the global economy, but the caboose.
“The conventional wisdom is that foreign economies depend on Americans to buy their exports. This is false. The global expansion of the past decade has created new demand everywhere, and people and businesses in all corners of the world are spending. However, in America, spending has largely been achieved through a massive vendor financing scheme. Foreign supplied credit has allowed Americans to continue buying, even while American income and savings have dropped. As this credit goes bad, the losses are landing on the bottom lines of foreign financial firms. In other words, the global pain is not resulting from American contraction but from having financed our preceding expansion. This is a critical distinction few have been able to make, and it is vital to appreciating the decoupling that has already occurred beneath the surface.”
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