Economist who predicted the 2008 financial crisis says a far ‘bigger’ one could hit the US soon

American stockbroker and economist Peter Schiff, who is known for predicting and betting on the 2008 financial crisis, has now predicted that a bigger economic doom is imminent. In an interview with Fox Business, Schiff warned that the rising prices of gold and silver on the backdrop of the U.S. dollar plummeting is a signal of a crisis that would make the Great Recession look like a "Sunday School Picnic." 

On "The Claman Countdown,' Schiff stated that the rising prices of gold and silver are "a warning about a bigger crisis" that's likely to hit either this year or the next year. "We are headed for a U.S. dollar crisis and a sovereign debt crisis," he added. He explained that the U.S. dollar hitting a record low is one of the primary reasons behind gold prices skyrocketing. "Central banks are buying gold to back up their currencies. They're getting rid of dollars. They are getting rid of Treasuries," he claimed before warning, "We are headed for [an] economic crisis, again, that will make the 2008 financial crisis look like a Sunday school picnic."

When the host interjected, saying the income, inflation, and productivity were holding strong, the market mogul claimed that the figures were skewed and would be revised.  "Inflation is going to be much more pernicious over the next few years than it was when Biden was president, unfortunately. That's what gold and silver are telling you. They are a warning," Schiff stated. He explained that back in 2007, the subprime market blew up similarly, proving his forecast correct. "When that happened, I knew that it was foreshadowing a bigger crisis that hit the following year. But the mainstream investment community, the Federal Reserve, Ben Bernanke, said that subprime was contained. He didn't understand the problem," he added.

Coming to President Donald Trump's trade policies, he claimed that the president had gotten it backwards, and the dysfunctional system will cause the dollar to dive further. "We depend on the world. They provide us with the goods that we don't produce. They loan us the money we don't save. Trump has it backwards. The world economy doesn't work because of us – our economy works because of the world," Schiff said. 

He explained that the country's consumer-based credit economy, which rests on the foundation of the U.S. dollar's reserve currency status, is dysfunctional as the world is pulling the rug by stocking up on gold and moving away from the dollar. "The dollar's going to collapse. The dollar is going to be replaced by gold," Schiff said, adding that there won't be a ceiling on gold prices as there is "no floor on the dollar". Predicting another crisis, he added, "The biggest difference between the crisis that we're about to have, and the one we had back then, is this one is all in America. It's not going to be exported to the rest of the world." He further explained that it wil be an American financial crisis and "the rest of the world will benefit from it."  

More on Market Realist:

Bank of America positive about gold as a promising asset for investment in the year to come

'The Big Short' investor who predicted 2008 crisis reveals how Venezuela raid can shape markets

Economist warns impact of Trump's policy may trigger a bigger crisis 10 years later