Economist warns coming financial crisis will make 2008 look like 'Sunday school picnic'
As gold prices keep rising, American economist Peter Schiff says investors should view the rally as more than a hedge — calling it a warning that inflation is speeding up, the U.S. dollar is losing global trust and a major economic reckoning may be near.
"Gold and silver are warning about a bigger crisis that's gonna hit either later this year or maybe next year. We are headed for a U.S. dollar crisis and a sovereign debt crisis," Schiff said Tuesday afternoon on "The Claman Countdown."
"Central banks are buying gold to back up their currencies. They're getting rid of dollars. They are getting rid of Treasuries," he continued. "We are headed for [an] economic crisis, again, that will make the 2008 financial crisis look like a Sunday school picnic."
Independent Women’s Forum senior policy analyst Carrie Sheffield told Fox News Digital on Wednesday that some commentators "like to make a play for TV time with loud forecasts" that often don’t match reality.
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The stockbroker opened his initial argument by claiming that the federal government is the primary reason gold has reached an all-time high price because the U.S. dollar is "at an all-time record low."
Sheffield also noted that inflation remained far lower under former President Trump’s policies than during the Biden administration, citing Bureau of Labor Statistics data showing stronger growth and steadier prices in 2025.
"During President Trump's second term, Bureau of Labor Statistics data show inflation averaged 2.7%. This compares to 5.0% during the Biden administration and just 1.9% during the first Trump administration. Thanks to smart tax, regulation and energy policies, America saw a phenomenal 4.4% GDP growth in the third quarter of 2025 and the Atlanta Fed showing 5.4% growth in the fourth quarter of 2025," she said.
"We've had pretty solid numbers. I mean, granted, consumer sentiment is very iffy, depending on the month, but Peter," host Liz Claman said. "People's incomes are pretty solid. We're starting to see some real gains in productivity."
"Unfortunately, the numbers are not accurate. They're highly skewed, they're gonna be revised, and a lot of it is being influenced by inflation," Schiff said. "Inflation is going to be much more pernicious over the next few years than it was when Biden was president, unfortunately. That's what gold and silver are telling you. They are a warning."
"Just like in 2007, when the subprime market blew up – something that I had been forecasting would happen for years and something that I bet against – when that happened, I knew that it was foreshadowing a bigger crisis that hit the following year. But the mainstream investment community, the Federal Reserve, Ben Bernanke, said that subprime was contained. He didn't understand the problem," he expanded.
"We depend on the world. They provide us with the goods that we don't produce. They loan us the money we don't save. Trump has it backwards. The world economy doesn't work because of us – our economy works because of the world," Schiff said. "We have a dysfunctional consumer-based credit economy that rests on the foundation of the U.S. dollar's reserve currency status, and the world is now pulling the rug out from under the U.S. The dollar's going to collapse. The dollar is going to be replaced by gold."
Schiff also said there won’t be a ceiling on gold prices since there’s "no floor on the dollar."
"The biggest difference between the crisis that we're about to have, and the one we had back then, is this one is all in America. It's not going to be exported to the rest of the world," he further clarified. "It's a global financial crisis. It's an American financial crisis, the rest of the world is actually going to benefit from it."
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"While there has been some global volatility with activity in Venezuela, Russia and Iran, domestically the United States is in a robust and growing position under President Trump," Sheffield countered.
A White House spokesperson echoed that optimism, pointing to foreign investment and record Treasury demand.
"Foreign holdings of U.S. Treasuries recently hit an all-time high while business leaders continue pouring trillions in investments to make and hire in America. Panicans have been predicting doom and gloom since the day President Trump took office, and instead Americans have seen inflation cool, real wages rise, and GDP growth accelerate," White House spokesman Kush Desai told Fox News Digital.