In a recent interview with Kitco News and a series of posts on X, the chief market strategist at Euro Pacific Asset Management, Peter Schiff, said the United States is heading into a financial crisis that won’t spill over to the rest of the world.
“This is going to be a financial crisis much worse than 2008,” Schiff said.
“But it’s not going to be global. It is a U.S. crisis. It’s actually liberation for the rest of the world.”
On X, Schiff posted, “The 2025 Financial Crisis will not be global. It will be mainly limited to the United States. The rest of the world has finally been liberated.”
America’s Spending Habits Under Fire
According to Schiff, decades of overconsumption and borrowing have caught up with the U.S., and the consequences are starting to show.
He blames a long-standing habit of Americans living beyond their means, financed by foreign creditors who are now backing away.
“We’ve been living above our means… that’s only because the rest of the world has lived beneath our means. They don’t have to do that anymore,” Schiff said.
“They don’t have to produce stuff for Americans anymore. They don’t have to loan their savings to America. They can invest in their own markets. Our loss is their gain.”
Tariffs Accelerate the Shift
Schiff argues that recent tariffs imposed by President Donald Trump on Chinese imports have only accelerated the decline.
The Trump administration hiked tariffs to 145%, prompting swift retaliation from Beijing, which raised its own to 125%.
Schiff warned that “the deeper fear is inside the U.S. Treasury market, traditionally the cornerstone of financial stability within the global markets,” where, despite the market turmoil, yields remain elevated.
He pointed to this as evidence that confidence in U.S. debt is unraveling.
“It’s been a confidence game the entire time,” he said, adding that confidence in U.S. sovereign debt is “about to collapse.”
Criticism of Fed and Economic Leadership
Schiff has been critical of both the Trump administration’s economic approach and the Federal Reserve.
He said the Fed is unprepared for what’s coming, especially as inflation expectations continue to rise and economic data worsens.
“We’re going to have widespread layoffs,” he said. “The service sector economy is going to shut down because imports are going to be cut off. All these businesses are going into bankruptcy.”
Public Pushback Online
On social media, Schiff’s comments sparked plenty of backlash. One user asked why he was posting so much “anti-American stuff.
Others questioned how a U.S.-only crisis could even be possible, pointing out the country’s role as the world’s largest economy and the issuer of the global reserve currency.
Schiff responded simply: “A forecast that will soon be history.”
For Schiff, this moment has been years in the making. “We pricked our own bubble,” he said. The rest of the world is moving on.
IMAGE CREDIT: “Peter Schiff” by Gage Skidmore, via Flickr. Licensed under CC BY-SA 2.0. Image adjusted for layout.