Tariffs, inflation, soaring interest rates and a weakening dollar are colliding in what economist Peter Schiff warns could trigger a financial collapse worse than 2008.

Peter Schiff: US Nearing Historic Financial Collapse as Economic Signals Flash Red

Economist and gold advocate Peter Schiff issued a dire warning Monday, arguing that the U.S. is on the verge of a financial disaster that could eclipse the 2008 crisis. Sharing his concerns on social media platform X, Schiff criticized both government leaders and financial media for ignoring key economic indicators he believes are signaling serious trouble ahead. He likened the current situation to the lead-up to the global financial meltdown over 15 years ago, claiming that the same blindness and missteps are happening again.

He warned that new tariffs will disrupt trade flows and cause a chain reaction of inflationary pressures. Schiff stated:

Tariffs mean fewer goods will come into the country, and fewer dollars will go out. More money chasing fewer goods means higher domestic prices.

“This is an economic certainty. As import prices rise sharply, demand will increase for domestically produced goods, sending those prices higher too. Meanwhile, lower trade deficits will result in fewer dollars being recycled into U.S. bonds, sending long-term interest rates higher,” the economist added.

He explained that these developments would severely impact both consumers and financial markets. In addition, Schiff emphasized that fiscal policy decisions could worsen the downturn: “Higher consumer prices and long-term interest rates will combine to weaken the U.S. economy, increasing the size of federal budget deficits. Middle-class tax cuts will worsen the problem by not only adding to deficit spending but by directly fueling demand for a diminishing supply of goods.”

Schiff also criticized the Federal Reserve’s likely reaction to the looming slowdown, warning that monetary easing in the face of inflation will only magnify the crisis.

“All of this will weaken the dollar, compounding the effects of tariffs by making import prices rise even higher,” the gold bug opined. “Meanwhile, a weaker dollar and larger budget deficits will put even more upward pressure on long-term interest rates, which the Fed will try to offset with a return to QE, throwing gasoline on an already burning inflation fire.” Schiff concluded:

This will not be 1970s-style stagflation. It will be something much worse.