Economist Peter Schiff has predicted that the US Federal Reserve will finally throw in the towel in its fight against inflation to face “something it fears even more, which is a complete economic collapse, another financial crisis or a sovereign debt crisis.” ”. He emphasized that “the months of declining inflation are in the review mirror,” and emphasized that now “we are going to see accelerating inflation.”
Peter Schiff on the possible economic collapse
Gold fanatic and economist Peter Schiff shared some dire warnings about where the US economy is headed and the consequences of the Federal Reserve’s fight against inflation in an interview with Greg Hunter on USAWatchdog, published Saturday.
Citing recent economic data, including the Personal Consumption Expenditures Price Index which rose 0.6% in January, Schiff said: “The months of declining inflation are in the looking glass. And now we are going to see an acceleration of inflation measured by these government indices”.
Stating that the Federal Reserve’s fight against inflation has been completely ineffective, the economist opined:
If the Fed is serious about fighting inflation, which I don’t think so, but if it is serious, it will have to fight a lot more than it has. Rates have to go up a lot more than anyone thinks.
However, Schiff said that higher interest rates alone will not be enough. “We also have to see a big contraction in consumer credit. We need credit standards to go up so consumers can’t keep spending,” she described. “People are spending money. They are racking up more credit card debt. That is inflationary… We need consumers to stop spending.” The economist emphasized that people need to work, produce and save, not spend.
In addition, Schiff stressed that the federal government needs to get its spending problem under control. He detailed:
We need significant cuts in public spending. The government can’t just give people money to spend, because that’s what drives up these prices. And ultimately, they will force the Fed back into quantitative easing.
Schiff predicted that the Fed will ultimately throw in the towel in its fight against inflation, adding:
Because he’s going to be fighting something he fears even more, which is a complete economic collapse, another financial crisis, or a sovereign debt crisis.
Furthermore, he warned that the Fed may even force the US government to consider legitimately cutting Social Security and Medicare “rather than just illegitimately cutting them creating inflation.”
The economist has previously warned that the Fed’s action could trigger a much more severe financial crisis and recession than the central bank acknowledges. He also recently predicted that inflation is about to get worse and the US dollar will collapse.
What do you think about Peter Schiff’s prediction of economic collapse? Let us know in the comments section.
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