Show and guest
Peter Schiff's own podcast, The Peter Schiff Show, features Peter Schiff himself as the guest. It was recorded after the US market closed on Monday, on the eve of voting in the midterm elections. Original English title: Debt Interest Is About to Pass Social Security... Here's What Breaks.
Key points
- Interest spending on the national debt will exceed Social Security spending next year: the arithmetic is hard to sustain even if interest rates do not rise; if rates do rise sharply, national debt interest could reach 3 trillion to 4 trillion dollars a year 0:00
- Total federal tax revenue is only a little over 50 thousand hundred million dollars, and it is impossible to spend sixty to eighty percent of tax revenue on interest; if interest rates really rise to that level, bank failures, a crash and defaults will follow 0:19
- On the eve of voting, betting markets had raised the probability of Democrats winning the Senate to 75%, the highest so far; Democrats were also very likely to win both chambers of Congress 1:41
- After a Democratic sweep, the impact of spending and deficits on inflation and the bond market will be the focus of the next episode 1:51
- Greater government spending and deficits will push up inflation and bond yields and weigh on the economy, while Trump has already publicly laid the groundwork for the claim that a Democratic victory would bring a 1929-style crash 29:11
- Interest on the national debt has already reached 1.4 trillion dollars, 40% above the defense budget. The only budget item still larger than interest spending is Social Security spending at 1.7 trillion dollars; interest is close to overtaking Social Security 50:16
Background and notes
The subtitles cover 0:00–57:16; this article sets out the main points of the entire 57-minute, 16-second podcast. The views and timestamps are paraphrased from the original subtitles, and each timestamp marks the start of the corresponding passage.