According to economist Peter Schiff, the American economy is doomed to failure . The Federal Reserve will “print money until the dollar collapses,” he warned, adding that “we’re going to have a dollar crisis and a sovereign debt crisis.”
He said: “I think that day of reckoning is at hand.”
Speaking on First TV, Schiff argued that the 2008 financial crisis was the root cause of the inflation we are currently witnessing.
“The cause of all this inflation is what the government did in response to that crisis: QE1, QE2, QE3, all of that, plus what we did during Covid. And as long as we keep running these enormous deficits, it will only grow worse, the economist explained.
He issued a warning after noting that the United States has an annual fiscal deficit of almost $2 trillion and a rising national debt.
According to Schiff, future inflation will be significantly higher than what we’ve seen in the past as a result of this. Inflation will likely be a much bigger issue in 2024 than it was in 2023.
“Interest rates are a price. And it’s an important price for a lot of companies, just like labor, and rent, and raw materials, companies borrow money to conduct their business, to make capital investments, to expand. A lot of these companies have taken up debt over the years and now the cost of servicing that debt has risen sharply,” said Schiff.
Schiff also warned of USD devaluation, pointing out the global shift away from the dollar in favor of alternatives. He predicts a rapid decline in the dollar’s value as trading partners seek alternatives, leading to faster price increases and eventual loss of control.
He concluded that, unfortunately, the story will have a horrible conclusion.
According to him, there will be a crisis with the dollar and a crisis with sovereign debt. The Fed will continue to print money until the value of the currency drops.
“I believe the day of judgement is near. I’m not sure if it will be tomorrow, but it will be arriving shortly, he clarified .
Last week, Schiff also warned of a potential catastrophe and mass abandonment of the US dollar, reiterating his belief that the dollar will eventually collapse.
He has consistently disagreed with the Federal Reserve’s recession predictions and advised selling dollars in July. Last month, he predicted a full-blown financial crisis in the US economy before the Fed reaches its inflation target.
Schiff believes that Bitcoin has inherent flaws, despite its groundbreaking role in showcasing the potential of blockchain technology.
He claimed that the cryptocurrency has no intrinsic value and functions much like a Ponzi scheme, with demand for Bitcoin predicated on the idea of selling it to someone else for more money.
“The demand for Bitcoin is based on the belief that you can sell it to somebody else at a higher price, and the only reason that the other person is willing to pay a higher price is because he believes that he can sell it to someone for an even higher price,” he stated, speaking on Yahoo Finance’s The Crypto Mile .
At first, Fink was skeptical of cryptocurrencies due to their early association with illegal activities. However, he later recognized Bitcoin’s value as a global asset independent of any specific currency and as a hedge against inflation.
Fink believes that the underlying blockchain technology has the potential to improve transaction speed and traceability, effectively eliminating some conventional financial intermediaries, notwithstanding the skepticism surrounding its usefulness.