Peter Schiff Blames Bidenomics For Surging Bond Yields, Energy Prices: 'What Happens If In A Year...Oil Is $150'

Noted economist and gold bull Peter Schiff warned that northward-bound bond yields and energy prices have further legs to play out.

What Happened: The yield on the benchmark 10-year Treasury note hit an intra-day high of 4.372% on Tuesday, the highest level seen since Nov. 2017. The spike in bond yields reflected investor expectations that the Fed might not soon begin reversing its rate hikes amid the recent spate of strong economic data, the slight uptick in inflation in August, and the spike in oil prices that could push inflationary pressure higher.

Crude oil prices have begun to run in response to supply-side worries, as some of the OPEC+ members have extended their output cuts. Tuesday, WTI crude oil ended at $90.48 a barrel after touching an intraday high of $90.72.

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Harbinger Of Inflation? Schiff said the rally in bond yields and oil prices indicate that the inflation problem was worsening. “What Happens if in a year there’s a 7 handle on 10-year Treasuries and oil is $150,” he asked.

“That Bidenomics,” he said.

An inflationary environment may not allow the Fed to drop its hawkish stance, which is the premise on which the market has been rallying for much of the year.

The Federal Reserve’s monetary policy committee is widely expected to announce a pause decision on Wednesday, although most economists warn that the Fed may not be done with its rate hikes yet in the current tightening cycle.

The iShares TIPS Bond ETF TIP, an exchange-traded fund ETF that tracks the investment results of an index composed of inflation-protected U.S. Treasury bonds, ended Tuesday’s session down 0.28% at $105.03, according to Benzinga Pro data.

Peter Schiff Wikimedia Commons

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