Peter Schiff: Growing Problems Leading To U.S. Dollar Crisis

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February 12, 2015 12:49pm NYSE:GLD NYSE:IAU

Peter SchiffGreg Hunter:  Money manager Peter Schiff says forget about the Greece debt questions; the problems in the U.S. are far worse.


Schiff contends, “I am even more concerned with the problems with the dollar. The dollar is benefiting right now because most people are just concerned about the euro. So, the dollar gets stronger because people sell euros and buy dollars, but they are missing the bigger picture. ”

“We have even more advanced problems with our currency than they have in Europe with the euro.”

Schiff goes on to enumerate the financial problems the U.S. faces such as, “The degree of debt we have, the degree we are dependent on artificially low interest rates which are obviously unsustainable and the massive trade deficits we have chronically year after year.”

“Last month, we announced the biggest monthly trade deficit in our history. These are growing problems that are ultimately going to lead to a U.S. dollar crisis.”

“Right now, people are confident in the dollar because they believe the Fed can raise interest rates, and we can actually afford to pay the higher rates–which we can’t. We can’t do it. If the Fed raises rates, we will have a financial crisis.”

“We would have no ability to service our debt if we had to pay a market rate of interest, but our creditors haven’t figured this out yet.”

“The real problems in Greece started when interest rates rose. Greece had a lot of debt before rates went up. They couldn’t repay the principal, but they could pay the interest. They could at least pretend by paying the interest.”

“Well, that’s all the United States does. We have no hope of repaying the principal.”

On gold, Schiff says, “Gold has not fallen, not nearly as much as the gold bears have expected. In fact, in 2014, gold was only marginally lower by 1% or 2% lower in dollars, but in most other currencies it did very well. It was up 5%, 10%, 20% or more.”

“You pick a currency, and gold did very well. In fact, gold outperformed most all the stock markets in the world in 2014. Thus far in 2015, it is beating most all the stock markets, and it is certainly beating all the currencies.”

“The skeptics have constantly overestimated how much gold would decline, and they are still very negative on the price of gold.”

On the so-called “recovery,” Schiff says, “We had a recovery in the stock market, asset prices went up. We had a recovery in the real estate market, but we didn’t have an economic recovery. Did we recover the jobs that we lost—no.”

“We recovered jobs, but not the ones that we lost. We lost higher paying full-time jobs, and we gained lower paying part-time jobs.”

On the next financial calamity, Schiff says one is on its way. It’s just a matter of time. Schiff says, “I know it’s going to happen. The problem is the further into the future it is, the worse it’s going to be because until it happens, the problems are just getting bigger.”

“They are not getting solved. The further into the future the crisis comes, the bigger the problems are when we are confronted with them. So, I hope something happens this year because if it doesn’t, it is going to happen in a latter year, and it’s going to be worse.”

Join Greg Hunter as he goes One-on-One with Peter Schiff, founder of Schiff Gold and Euro Pacific Capital.

(There is much more in the video interview.)

This article is brought to you courtesy of Greg Hunter from USA Watch Dog.


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