by Greg Hunter, USA Watchdog:

Money manager and economist Peter Schiff says the markets think the Federal Reserve can win the fight on inflation by raising interest rates.  Look at the falling stock market, and many people are getting increasingly nervous that something is going to break.  Schiff explains, “The Fed is in the same predicament now, only worse, because it’s a much bigger bubble than the one we had in 2008 or 2018.  We have a lot more debt now, and the economy is less able to tolerate 5% interest rates than in 2008 and 2018.  Think about it.  If the Fed Funds Rate got to 5%, I’ll bet the 30-year mortgage rate would be 9%.  People can’t afford to pay 9%, especially when they are borrowing 95% of the value of the home.  So, it’s a massive mortgage. . . . This housing market was built for 3.5% mortgages, not 9% mortgages.  Look at the federal government.  We have a $31 trillion national debt.  If the Fed got up to 5% . . . .how is the government going to have to spend $1.5 trillion a year on interest payments on the national debt? . . . It’s impossible.  What about all the debt corporations took on?  It has to be rolled over.  How are they going to go from 2% or 3% to 7% or 9%?  What about all the junk bonds?  How are they going to survive?  What about all the municipalities and state governments that have borrowed money at low rates?  How are they going to roll that debt over?  What about commercial real estate?  How are they going to survive?  . . . The Fed created an economy completely dependent on near 0% interest rates and inflation. . . . There is going to be no way to finance these companies.  So, there is going to be a massive implosion.  If the federal government is going to stop monetizing debt and raise interest rates, we need massive cuts to government spending.”