When recession struck, one of the questions asked by the Americans is “why didn’t anyone see this coming?” What they don’t know is that some people did. One of them is Peter D. Schiff, who wrote The Little Book of Bull Moves in Bear Markets. It is a part of a series of books that precisely focused on investment areas and strategies. Schiff’s books were different from other financial books because he made it easy to understand, and did away without the business jargons – he wanted to let them know. His books were a result of a claim that he made towards the end of 2006 that the Economy of the United States is nearing its impending doom.
In the first chapter of the book, Schiff talks about the distressed economy of the US. He highlighted the fact that the country is aggressively tearing down its own wealth by spending much on imported goods. In it he made a very strong case for a strong financial slump over the next several years. Second chapter talked about the best way to stay protected when this happens: avoid cash and bonds. He recommended putting up non-dollar bank accounts, as well as rare metals. Chapter 3 of the book raised eyebrows because of his advice against listening to “people who think they know.” People closely looked at it as a warning to not listen to people like him but in reality, it was his way of saying “Don’t just listen to the experts or those who claim they are. Know for yourself.”
In terms of investment, Schiff expressed his belief in the fact that companies that produce commodities will remain strong because people will still be in need of goods even when the economy is at its worst. They therefore, are your best bet. He also looked at the possibility of Americans investing their money on stable grounds, and countries that don’t have colossal export transactions with the US, making mention of countries like China, India, Russia and Brazil. He believes these countries are the best for investment and emigration because it is where most of the growth brought about by the turn of the century is taking place.
The author wrapped the book up with the thought that frugality is the best way to prepare yourself and the best way to survive any downturn. He believes that through modification of lifestyle and economy, America will win this battle and will be back in shape. “The path between here and there, though,” he says, “is quite dark”.
The book is a good example of a well thought of battle plan. In as early as 2006, Schiff has been quoted saying in an interview that “the United States economy is like the Titanic and I am here with the lifeboat trying to get people to leave the ship… I see a real financial crisis coming for the United States.” This earned criticisms among other leaders but he did not stop. He said on a separate account that “What we need now is higher interest rates, severe cuts in spending, and that will bring about a severe downturn, but there’s no way around it. We have to swallow some bitter medicine; if we don’t, we’re going to get sicker and sicker.” New York Times columnist Joe Nocera wrote in a December 2008 article that “Mr. Schiff absolutely nailed the current crisis — and did so many, many months before the rest of us could feel the first tremor.”
