May 18, 2026
Peter opens Wednesday's episode of the Peter Schiff Show by describing the difficult hand dealt to new Fed chair Kevin Warsh. He then walks listeners through recent startling inflation data, interest-rate math, and what that means for the dollar and precious metals. He closes by defending market-driven change and the role of the consumer in shaping the economy.
He warns that the new Fed chair Kevin Walsh is stepping into a policy nightmare, with the Fed boxed in between rising inflation and slowing growth:
First of all today was the day that Kevin Walsh finally got approved as the new Fed chairman and he is really walking into a firestorm at the Fed. I mean, you know couldn't have been a worse time to get the job given that he is really stuck between a rock and a hard place. You've got a weakening economy and you've got strengthening inflation. You've got the Fed's worst nightmare stagflation because they have no policy tools to deal with this situation.
Peter flags the Producer Price Index (PPI) as a leading warning for the Consumer Price Index (CPI, the Consumer Price Index): producers will pass higher costs on to consumers, and the recent monthly jump is alarming:
But the real bad news is not the CPI that we got yesterday; it's the PPI that we got today because this means that the CPI that we get next month is going to be much worse because the producers are gonna now pass on these price hikes to their customers.... Well, last month producer prices were up point five; the expectation for April was an increase of point seven; the actual increase was twice that amount: one point four percent was the increase in one month. That's more than half of the Fed's two percent target in just one month.
He reminds listeners that nominal rates alone don't tell the full story - and uses a historical comparison to show how much more painful high rates would be today given vastly higher federal debt:
Think about this though: rates are the highest they've been in about 19 years, but the chart and the trend are what's important. What happens if rates get back to where they were in 1991 ? Now you're looking at a 30 year yield at 8 percent; 8 percent in 1991 the national debt just hit 3 trillion; we have a debt that's 10 times as high as it was in 1991.
Peter stresses that traders obsess over nominal Fed moves, but what really matters is real interest rates - nominal rates minus inflation - and those real rates are collapsing if inflation keeps accelerating:
But all of the attention that is on nominal interest rates and whether the Fed will or will not cut them or maybe even hike them-people are talking about 'hey, maybe the Fed might hike rates'-even though they still have an easing bias.... That's missing the forest for the trees because what's really important is what's actually happening with real interest rates. Real interest rates are plunging as inflation is soaring.
He points out the leadership shift inside the metals complex - silver is outpacing gold - and reads that as a bullish sign for a broader metals cycle that includes industrial metals like copper:
I've been talking about the underlying strength in silver; silver has been very strong, it has been more resilient than gold-even when gold is down silver is up. Silver is now leading gold and as I've said many times that is bullish; that is better for precious metals than when gold is leading. The biggest bull markets for precious metals are when silver leaves gold.
Finally, he defends Bezos as an example of consumer choice reshaping markets rather than villainous monopoly power - a reminder that free markets and consumer sovereignty drive innovation and change:
Jeff Bezos didn't put anybody out of business; the Amazon customers put people out of business, not Bezos. What did Jeff Bezos do ? He gave people an alternative that they preferred; he gave people the ability to shop from home, to buy almost everything they wanted and have it shipped to their house the next day, and people like that.... Why doesn't anybody vilify the consumer ? Oh those evil greedy consumers, they put all these mom and pop businesses out of business-well because they just wanted to get a good deal.
This article was originally published on SchiffGold.com.