Peter Schiff: The next crisis looms

Trouble lies ahead for the dollar, says investment guru Peter Schiff. Is it time to once again load up on gold?

Peter Schiff is not short on self-confidence. "I don't think I've been wrong on anything," he said in early 2009.

Schiff, 50, has built his libertarian, purist free-market approach to the crisis and its aftermath "into a formidable one-man brand", says Kirk Shinkle on Money.usnews.com, including two books, and his money-management business Euro Pacific Capital.

In 2006, he warned that the debt-induced party would end badly, with the housing bubble bursting and a global recession following.

Schiff was so confident that properties were overpriced that he rented until the age of 46, says Isaac Arnsdorf on Bloomberg.com. But all that was just the warm-up act to the "real crisis", he reckons.

The relentless rise in US government debt, along with endless money-printing by the Federal Reserve, risks a massive loss of confidence in the dollar by foreign investors, notably the Chinese, who are propping up the American currency.

It could well be foreign investors who call a halt to the relentless debasement of the dollar through quantitative easing, he says. The final straw may be when they realise that the Fed, far from preparing to taper, will end up printing even faster as the underlying economy is so shaky.

With the dollar tanking and all this printed money being injected into the economy, investors should hold gold, which could be at $2,000 within a year. Schiff would be "amazed" if gold hasn't skyrocketed and the dollar collapsed before 2017.

Schiff has, however, incurred criticism for sounding like a stopped clock. While he was right on the housing bubble, he has also been talking about the danger of a dollar collapse and hyperinflation since the late 2000s.

Eventually, however, the world is going to twig that America is broke, he insisted last year. "I've gotten enough right that people can give me the benefit of the doubt."

Recommended

José Neves: the Buddhist transforming luxury fashion
People

José Neves: the Buddhist transforming luxury fashion

José Neves cornered the market in building bespoke websites and apps for boutique fashion brands and retailers. That put him in a sweet spot when the …
25 Jul 2021
The story of Wise, a multi-billion fintech started by accident
People

The story of Wise, a multi-billion fintech started by accident

If you grow up in a situation where a whole country has to be made from scratch, creating a game-changing financial technology start-up such as Wise …
17 Jul 2021
Wes Edens: the raider who snapped up Morrisons
People

Wes Edens: the raider who snapped up Morrisons

Wes Edens is already well known in Birmingham for rescuing the city’s Aston Villa football club from disaster. Can he pull a similar trick with a flag…
11 Jul 2021
John McAfee: the tech maverick who lost a $100m fortune
People

John McAfee: the tech maverick who lost a $100m fortune

John McAfee made his name pioneering software to protect against computer viruses. He lost nearly everything in the financial crash and lived a life o…
4 Jul 2021

Most Popular

The MoneyWeek Podcast: Asia, financial repression and the nature of capitalism
Economy

The MoneyWeek Podcast: Asia, financial repression and the nature of capitalism

Russell Napier talks to Merryn about financial repression – or "stealing money from old people slowly" – plus how Asian capitalism is taking over in t…
16 Jul 2021
Why the UK's 2.5% inflation is a big deal
Inflation

Why the UK's 2.5% inflation is a big deal

After years of inflation being a financial-assets problem, it is now an “ordinary things” problem too, says Merryn Somerset Webb. But central banks st…
16 Jul 2021
Commodity supercycle or not, here’s a metal that’ll still be in demand – tin
Industrial metals

Commodity supercycle or not, here’s a metal that’ll still be in demand – tin

Commodity prices may have come off the boil recently. But for tin, the only way is up. Dominic Frisby picks the best ways to invest.
7 Jul 2021