Investment guru Peter Schiff believes the imminent demise of the U.S. dollar as a global currency is due to U.S. “fiscal profligacy” that has pushed the budget and trade deficit beyond the limits, leaving the dollar at the mercy of foreign reserves held by other countries.
“Americans are going to have to deal with reality that we’ve hollowed out our infrastructure; we’ve been living beyond our means. And there’s going to be a day of reckoning for these years of excesses,” he said.
Schiff is the CEO of Euro Pacific Capital, a U.S. investment advisor and broker-dealer. He has been repeatedly bearish on the U.S. markets and economy and is known for holding long-term investments in the foreign stocks and currencies of countries with sound fiscal monetary policies.
“What has enabled this over the years has been the world’s willingness to hold U.S. dollars as the primary reserve currency,” Schiff said during a debate on RT.
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He warned that with U.S. household debt at about $15 trillion, something will eventually give in and he predicted that emerging markets would rally in the wake of the dollar’s demise.
“We’re not going to stop with the profligacy until it collapses,” he said. “The only thing that is going to cause a change is a crisis. And it’s going to be a dollar crisis. It’s going to be a sovereign debt crisis.”