A Recession Projection That Might Make You Weep

Photo: Spencer Platt/Getty Images
William D. Cohan
May 15, 2022

Peter Schiff, now 59, has been around Wall Street for a long time. After a stint as a broker at Shearson Lehman Brothers, a predecessor of the now-defunct bank that bore part of its name, he and a partner bought an inactive brokerage firm based in Westport, in the mid-90s, and renamed it Euro Pacific Capital. He later sold the company, which was renamed Alliance Global Partners, and took a role there as chief economist and global strategist. He is also a master of our new multimedia world: he blogs, he writes books, he has a podcast, a YouTube channel, a radio show, and he’s an effective tweeter with nearly 705,000 followers. (Peter, please tweet this out there.) 

More notably, Schiff is among that small cohort who saw the trouble brewing in the years leading up to the 2008 financial crisis and yelled about it from the metaphorical mountain tops. “Guys like me, we’re just dismissed as ‘Gloom and Doomers,’” he told me by phone this week from Puerto Rico, where he hangs out these days. Needless to say, Schiff is very worried—very worried—about the coming financial crisis. “We’re still in complete denial of the problem,” he said. 

Over the years, I’ve interviewed my share of Gloom and Doomers. I spoke with Bill Ackman, the hedge fund manager, just as he was betting the markets would collapse as the extent of the pandemic became known (he was right), and again as the Federal Reserve decided to bail out the financial markets a month or so later (he was right about that, too). I’ve chatted often with Mark Spitznagel, the founder of Universa Investments, a hedge fund that offers other hedge funds and institutional investors a form of portfolio insurance at moments like these to protect against large losses. Both these men are hedge fund managers who get paid well to figure out how to profit from financial disruption.