Peter Schiff: Get Ready for a U.S. Dollar Collapse

Peter SchiffWhile investors fret about China’s recent currency devaluation, they should be more concerned about a stock market crash and U.S. dollar collapse in 2015, according to noted investor Peter Schiff.

“The dollar is very overvalued, and the dollar is a bubble,” CEO of Euro Pacific Capital Peter Schiff said in an interview with Newsmax TV. “This dollar bubble is going to burst.” (Source: Newsmax TV, August 13, 2015.)

Schiff downplayed the People’s of Bank of China’s recent monetary policy to boost their struggling economy. He described that the economic crisis at home is much more severe than overseas.

“China’s economy is not failing and this is a small devaluation, two percent. The Chinese currency has increased in value dramatically over the past several years along with the U.S. dollar. So this move was motivated not by the exchange rate between the yuan and the dollar, but between the yuan and all the other currencies because the dollar is in a bubble right now,” he said.

The latest move by the Chinese government came after the second-largest economy has started slowing faster than previously expected. A slump in the Chinese economy could have significant impact on the already fragile U.S economy.

“That’s going to sink the dollar and then the Chinese are going to have to revalue their currency much higher in the future against the dollar and it’s the dollar collapsing that’s going to hurt the U.S. Not this recent move by China,” he said.

On the other hand, the Federal Reserve prepares to raise the interest rate after nine years of being kept near zero. But Schiff believes that under these circumstances, a U.S. economic slowdown is inevitable and officials in the Fed won’t be able to raise the interest rate.

“Our economy is in much worse shape than the Chinese economy. The Fed is going to be forced to admit this. They’re not going to be raising interest rates; they’re going to be doing QE4.” He even suggested that the Fed may commence the fourth round of their money printing program as the U.S. economy is set to slow down.

“We’re on the verge of a much worse financial crisis than the one we went through in 2008 and it’s going to take the form of a currency crisis.”

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