Economist Peter Schiff says the U.S. dollar decline will be “far greater” than what Treasury Secretary Janet Yellen has warned. “This portends a significant decline in our standard of living,” he cautioned. Furthermore, the economist stressed that Federal Reserve Chairman Jerome Powell “is clearly worried about the evolving financial crisis, but doesn’t want to spook markets.”
Peter Schiff Predicts Larger U.S. Dollar Decline Than Yellen Expects
Economist and gold bug Peter Schiff issued more warnings about the U.S. economy, the banking system, and the U.S. dollar in several tweets this week.
Treasury Secretary Janet Yellen warned during her testimony before the House Financial Services Committee on Thursday that there would be a “slow decline” in the U.S. dollar as the global reserve currency. Emphasizing concerns that sanctions imposed by the U.S. have motivated a number of countries to look for USD alternatives, she cautioned that the decline in USD dominance is “something we have to accept.”
Commenting on Yellen’s warning about U.S. dollar dominance, Schiff tweeted Thursday:
Janet Yellen warned Americans to expect a decline in the dollar’s share of central bank reserves. But the decline will be far greater than she thinks, as a result of both dollar depreciation and central bank selling. This portends a significant decline in our standard of living.
“We have too much debt,” Schiff stressed in a follow-up tweet, stating that “our budget and trade deficits are much larger than any other nation.”
Fed Chair Powell Is ‘Clearly Worried’ About the Evolving Financial Crisis
Schiff also commented on the Fed pausing its interest rate hikes at the latest Federal Open Market Committee (FOMC) meeting on Wednesday.
Fed Chair Powell’s “rationale for skipping a rate hike, while admitting the risks to inflation are still to the upside, doesn’t make sense,” Schiff opined, asserting:
Powell is clearly worried about the evolving financial crisis, but doesn’t want to spook markets. So he’s done hiking, but doesn’t want to admit it.
“Don’t believe the hype on the Fed’s hawkish pause on rates. If the Fed really was hawkish, it wouldn’t have skipped this rate hike. There’s a good chance that the Fed’s next move on rates will be a cut, not because inflation is lower, but because the labor market finally cracks,” he added. Powell said at a press conference Wednesday that while “it will be appropriate to cut rates at a time when inflation is coming down really significantly, we’re talking about a couple years out.”
Schiff also predicted that there will be “the biggest bank run in world history,” noting that “It will make the small runs of the Great Depression look like a Sunday school picnic.”
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