By John Seiler

Gov. Jerry Brown and the California Legislature have been congratulating themselves for passing a budget on time and with a surplus. It’ll likely be the last time they do so for a long time.

I can’t embed this video featuring Peter Schiff, the investment guru; but click here for it. A decade ago he predicted that the bubble economy of that day soon was about to pop, which it did in 2007-08.

He makes similar comments to what I have been writing here: That the current “recovery” is based on the Federal Reserve Board printing trillions of dollars of funny money, while keeping interest rates near zero percent. The policy destroys the savings of the middle class, ripping up the whole economy. The rises in the stock market and housing prices are Fed-pumped illusions about to burst, as they did in 2007-08.

As he points out, housing interest rates already have risen from 3 percent to 4 percent, and soon will rise to 5 percent. When that happens, the housing boom will crash.

Meanwhile, the national debt keeps rising, now to $16.7 trillion. Even worse, the unfunded liabilities of the federal government now stand at a staggering $222 trillion, according to the calculations of Boston University economist Leonard Kotlikoff.

The next recession could be as bad as, or worse than, the Great Recession we supposedly “recovered” from.

Bad economic policies always hurt us in the end.

Make preparations for your own personal and business finances. Don’t be as irresponsible as the federal, state and local governments.