Peter Schiff might have the biggest set of brass cojones of any financial guru I’ve witnessed in my lifetime.

When he warned of an impending recession in 2006-2007, he was dismissed as a ultra bearish fool.  When he said a real estate bubble had formed and no one would be able to sell homes that are worth less than their mortgage, business pundits and Realtors dismissed him like a court jester.

He’s crazy!  He’s wrong!  Don’t listen to this guy… he’s a quack!

And look where we are today.

For making the correct calls, Jon Stewart interviewed Schiff last night on The Daily Show.

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Aside from nonchalantly alerting Chris Dodd that his Senate seat may be in danger (Schiff disclosed he may run for a Senate seat in Connecticut), he gave a stellar interview.

Most surprisingly, Schiff is the only guest I’ve ever seen to appear on The Daily Show and openly criticize President Obama and not be skewered by the left winged Stewart and booed by the audience.  Schiff’s record is so good he can create a legitimate dialogue with Stewart and convince him that Obama is actually doing a worse job at managing the economy than former President George W. Bush.

Perhaps that’s what I’m most impressed about.  Stewart didn’t balk when his guy (e.g. Obama) was called out, and actually kept hanging on Schiff’s every word.

I guess this is a meritocracy after all!  Being the black sheep and making the tough call when everyone else says you’re a fool really does make people listen… after the results have been tabulated of course.

A few highlights from the interview:

1. Everyone got drunk on Government Kool-Aid.  The government (e.g. The Federal Reserve) gave away so much cheap credit that we spent and spent without any worries of how to repay.  Now we rely on the Chinese to bail us out.
2. What Change?  Obama campaigned on a notion of “change”, but he’s driving off the same cliff that Bush had driven us toward, except Obama just hit the gas.
3. Too Big to Fail?  No, Wall Street financial institutions were not too big to fail… they’re too big to bailout!
4. Credit is a cancer.  Obama considers credit to be the lifeblood of the economy, but Schiff calls it the cancer of our economy.  You can’t drink yourself sober!
5. The Federal Reserve kept interest rates artificially low.  If the Fed would have gotten out of the way, the free markets would have pushed rates higher when they suspected risk had increased.  Government effectively rigged the game in their favor.

Let’s hope Schiff gets it wrong this time, but if you’re concerned, it might be a good time to educate yourself about inflation and research what you need to do to protect yourself against inflation.

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