Economist Peter Schiff Warns of ‘Massive Crisis’ and a Rush to Exit US Dollar

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Economist Peter Schiff has warned of “a rush” to get out of the U.S. dollar. “There’s going to be a massive crisis,” he predicted, adding that “it’s going to send the economy into a tailspin and people are going to feel the economic pain.”

Peter Schiff’s US Dollar Warning

Economist and gold bug Peter Schiff reiterated his warning about the impending collapse of the U.S. dollar in an interview with David Rodriguez last week.

Replying to a question about whether everyone is escaping the U.S. dollar, Schiff said: “They will be. Right now, it’s just kind of like a trickle.” However, he stressed:

It’s gonna be a deluge before too long where it’s a rush to get out of the dollar.

Schiff explained that a mass exodus of the U.S. dollar will happen “because we have these deficits — $2 trillion-plus annual budget deficits — not only as far as the eye can see, but the eye can see them getting much bigger than $2 trillion, $3 trillion, $4 trillion.” He exclaimed: “It’s completely unsustainable during the next official recession. When unemployment really spikes back up, the deficits are going to be $4 trillion a year, $5 trillion a year. Right now, we almost have a $33 trillion national debt [and] interest on the debt is now the third largest line item in the government budget.”

The economist added: “By next year, the interest on the debt is going to be the biggest expense the government has … Eventually, it will be the only expense we have. If this continues, there won’t be any money left over for anything but interest and, obviously, we can’t get to that point.” He predicted:

There’s going to be a massive crisis long before we get there and, you know, it’s going to send the economy into a tailspin and people are going to feel the economic pain.

Schiff also noted that many countries worldwide are ditching the U.S. dollar and using national currencies in international trade, such as the BRICS nations. He stressed that the United States has used the U.S. dollar as a weapon through sanctions, such as when it froze Russia’s dollar reserves. “That was a huge wake-up call to every nation in the world but in particular a nation like China … and maybe Saudi Arabia,” he opined, elaborating:

It sent a message: ‘Get out of the dollar, otherwise you are in a very vulnerable position because the U.S. could punish you for using the dollar.’

Schiff has repeatedly warned about the U.S. economy and the U.S. dollar. Last week, he said the U.S. cannot afford to decouple from China. Last month, he warned of a “full-blown financial crisis” hitting the U.S. economy.

Do you agree with economist Peter Schiff about the U.S. economy and the U.S. dollar? Let us know in the comments section below.