Economist Peter Schiff warns that the Fed’s action could lead to a market collapse, a massive financial crisis and a severe recession

Economist and gold digger Peter Schiff believes that the Federal Reserve’s action on the U.S. economy can have two consequences. The first results in “a massive financial crisis and a severe recession” with the collapse of stocks, bonds and real estate. In the second case, “the world will flee the dollar“, the economist points out.

Peter Schiff on the US economy: Two possible outcomes

Economist Peter Schiff continued to share his views on the U.S. economy and the Federal Reserve’s efforts to reduce inflation this week. Regarding the direction the U.S. economy is headed, he tweeted Saturday that “there are two possible outcomes“. Describing one of these outcomes, he detailed:

The Fed succeeds in bringing inflation down to 2%. Stocks, bonds and real estate collapse, leading to a massive financial crisis and a severe recession that results in government defaults & spending cuts.

In his thread, he wrote: “Or the Fed pivots before inflation returns to 2%. If the Fed pivots, either to avoid a financial crisis or in response to a crisis, inflation will soar, unlike what was experienced after the 2008 financial crisis. This time, instead of running to the dollar, the world will run from it.

Schiff also has tweeted Friday:”Everyone knows about the high inflation of the 1970s that didn’t end until Volcker got serious in the early 1980s. But in the ten years from 1982 to 1992, the average annual increase in the CPI was 4.43%. The Fed didn’t bring inflation down to 2 percent until after the 2008 financial crisis.

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Peter Schiff regularly comments on the state of the US economy on social media. In September, he warned, “Inflation is here to stay, and will get much worse despite rate hikes, due to over a decade of inflationary monetary and fiscal policy. This is very bearish for the dollar and bullish for gold.“Schiff noted, “Gone are the days when inflation was less than 2 percent“.

In addition, he noted in August that the United States faces a “massive financial crisis” which “will be much more severe when defaults begin.” In May, he warned of an economic recession in the United States that “will be much worse than the Great Recession .“.

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Peter Schiff recently reached a settlement with the Puerto Rico financial regulator and agreed to liquidate his Euro Pacific Bank without admitting any legal wrongdoing.

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