Daniel Roe
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Poster: Daniel Roe @ Fri Oct 02, 2009 5:17 pm
About 6 months ago, while watching every video on the Ludwig Von Mises youtube channel, I stumbled across a meandering, rambling, unscripted, incendiary, merciless rant by some dude named Peter Schiff.
For those not 'in the know':
- Schiff is a stock broker who, with reasonable accuracy, predicted the causality, time, and extent of the recent economic troubles. He did this through, among other media, Crash Proof: How to Profit From the Coming Economic Collapse (2007)
- He is the CEO of Euro-Pacific Capital which, as the name suggests, makes investments anywhere but the USA (heavily in Canada though).
- Schiff is born-and-bred libertarian, with his dad (Irwin Schiff) being so awesomely looney that he's actually been in and out of jail for the past 60 years for civil disobedience in the form of not paying federal income taxes. He recently was sent to jail once again, at age 84. He will be there until 2016.
- Schiff is far more pragmatic than his father. He reluctantly bows to governmental and social pressures by following laws and recognizing social mores (like not being an aging jailbird struggling hopelessly to slay goliath using a couple books and the constitution).
- The latter, in my opinion, is evidenced by him running as a Republican in the Connecticut senate race instead of the obvious and more applicable "Libertarian" moniker.
I. Euro-Pacific Capital
My current mutual fund has adopted a rather unorthodox strategy of measuring a prospective investments growth in terms of the size of the fire that could be stimulated by shoveling my money directly into it. I've decided, therefore, to shift the few dollars I have left to another company and possibly owning stocks directly. I've been following Schiff's public statements on Youtube for the past few months, and was highly entertained by his entrance into the Republican senatorial primary, so I looked up Euro-Pac and found there was a branch office nearby... "Well... why not?"
EPC is a smaller company, so I expected some moderate-rent digs, even though this was the 'rich' side of town.
So I walked into this beautiful, lavish office building with this ultra-hot receptionist at the front desk (and an idle secondary receptionist just adjacent to the primary one, in case one surpassed thermal tolerances and needed to be swapped out). They called the representative down to meet me and as he escorted me through the labyrinth of people and cubicles, I finally asked, "is this all Europac?"
"No," he replied "just this part up here."
He gestured towards this bundle of much smaller, windowless closet-esque offices ahead of us. I'm down with minimalism, but it was ironic given the lobby with the fembots and whatnot
What first jumped out at me were the items on the desk which were obviously permanent fixtures: calendar, plant, computer, and a copy of Peter Schiff's new book. In fact, though there were not many 'personal items' in the office, among the few were FIVE different books by Peter Schiff, including two duplicate copies. There were no other books on the shelves of the office, as if to say no other book authored by man or ape need be read.
In fact, the first words out of the guy's mouth were "So, where did you hear about Peter?"
My reply was "Wait, why would you guess I heard about this place through him?"
We kind of chuckled and he responded with "Well that's kind of 'our thing'." ... or something to that effect.
I knew Schiff was a walking advertisement for his own company, but I didn't actually realize his company was his company. It's almost like being a EPC client is like being granted membership into the Peter Schiff Fan Club or maybe even the Cult of Peter.
At several points in the discussion when poking around for different investment ideas, the broker introduced a stock by saying "This is what Peter likes" or "Peter's real big into..."
It was a little aggravating, as you can imagine. Is Peter handling my account personally? Will he call me every month with suggestions and updates? Will he blow me if he accidentally co-mingles my money with his Thai Hooker fund?
Schiff's employees bear striking resemblance to the Oompa Loompas, who practically worshiped the eccentric Willy Wonka and labored as slaves, catering to his every whim... Okay maybe it's not that bad, but if his reps all had orange skin and green hair I think I'd be morally obligated to give him all my money.
All that said, their rates seemed very reasonable apart from their first-ever mutual fund which was hatched about 2 months ago. Said fund is exclusively Chinese stocks, so their excuse was naturally something along the lines of "there are a bunch of fees and exchange difficulties yadda yadda It's freakin China--literally". I suppose that's reasonable explanation, but the fund would have to yield roughly 6% just to overcome the fees.
I have some real trepidations about China. I mean, it's freakin China. I don't know anything about China, and I'm willing to bet a lot of white investors don't either. For the time being I'll wait until it actually has a past-performance to look at.
Euro-Pac does specialize in a lot of strategies I'm leaning towards. They're able to purchase currencies, stocks in essential goods and services, commodities and do it all in foreign denominations immune to American inflation. They don't just do Asia, either; they're big into Australia, New Zealand, Europe, and Canada. The MERK hard currency fund (symbol MERKX) can be accessed through there and it does extremely well.
Even though I have some misgivings, this firm is still my top candidate for my next investment firm. I mean, even if Schiff takes his antics to their logical conclusion and he and his company go all Heaven's Gate on me, I'll still own the stocks so it won't leave me broke.
Update: Apparently Fidelity has some really good international common stock mutual funds as well.
II. Irwin Schiff
I was going to start off trying to persuade you to respect this True American Patriot™ (forgive the hackneyed language, but I use this term sparingly). However, that's really not the way I feel about Irwin Schiff.
Here's the deal as I see it: If you don't think Irwin Schiff is a terrific bad-ass, you're an idiot.
There's really no way around it. This guy recognized that the income tax violates a HANDFUL of the amendments known as "The Bill of Rights." He then devoted his whole life proving not only that to be true, but also that even in the weighty tome that is the personal income tax code, there exists no line that says you actually have to pay it.
Of course, as a practical matter, since everyone believes this to be true, the government doesn't even have to be right.
In one of the many cases against Irwin Schiff, the prosecution and even the judge (carefully selected by the government to see this case) told the jury essentially that even if no particular statute could be found, Irwin Schiff could still be held in violation of it. And they won with that. Because that's how it works.
So to sum up: You may think Irwin is a cooky libertarian nut who has a fetish for prison. However, he's been in and out of jail for DECADES defending the Bill of Rights (albeit futilely). He sacrificed greatly for something he believes in, and that's something that will almost certainly never be said about any of us. By anyone. Ever.
III. The Senate Run
My opinion on Peter Schiff's Senate run is pretty easily summed up:
- Schiff is against Medicare and Social Security.
- Schiff is in favor of legalizing drugs.
- Unless the next recession occurs before the Republican primary, He's F$cked.
I'm not saying it's impossible. I'm saying (again, forgive the cliche) the paradigm has not shifted... yet.
Some are still confused as to whether or not we're out of the woods economically speaking. The economy is THE ONLY issue Schiff could be potentially popular on. When (or if) it becomes well known that we are actually in the middle of a depression, Schiff's record will be a tremendous boon and could propel him to the front.
The problem is time: We had this first recession and the next one is sure to follow. However, will it be deep and alarming enough for people to actually drastically reconsider their political approach? Will it be in time for Schiff to win the Primary? Who knows?
Happy Note
On a happier note, I'm going to talk about prostate cancer.
Prostate cancer is one of many cancers that is actually fairly preventable through changes in lifestyle and such.
Who do you think are least likely to get prostate cancer (other than women, smartass)?
Prostate cancer survivors.
After years of tear-jerking pleas from doctors, cheeseburger binges, and pretending to be an obese couch-ornament, they all at once change their ways. Men who survive prostate cancer tend to change their whole lifestyle after their little 'brush with death', now realizing the full consequences of their actions.
I believe this depression--this 'brush with death'--may actually purge the notions of keynesianism and monetarism from the minds of short-sighted, self-indulgent, opportunistic politicians (and the people that elect them). After decades of printing and borrowing trillions to support decadence and irresponsible non-investments, America will "go on a diet." Either that or we'll meet a horrible f$ckin end; how should I know? Someone call that soothsayer Schiff.
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