Economist and gold bug Peter Schiff has warned of a financial crisis and a much more severe recession than the Federal Reserve recognizes. “The economy is not only going to weaken, but weaken much more than the markets expect,” the economist stressed.

Peter Schiff’s Warning

Gold bug and economist Peter Schiff voiced his concerns regarding the U.S. economy several times this week. Commenting on the Federal Reserve’s efforts to curb inflation, he said:

The reality is inflation is not going to weaken. It’s going to strengthen. The economy is not only going to weaken, but weaken much more than the markets expect.

“The real cause of inflation is the U.S. government and the Federal Reserve acting in concert with one another, where the U.S. government spends money it doesn’t have, and then the Fed prints the money for the government to spend — that is why we have inflation,” he explained.

In an interview with Fox Business on Wednesday, Schiff commented on the speech by Federal Reserve Chairman Jerome Powell who claimed that disinflation “has begun” but is going to take time. Schiff argued: “That disinflation is transitory. Maybe he doesn’t realize that yet, but it is.”

Emphasizing that the government has continued to spend billions of dollars every month, Schiff said if the Fed chairman believes that a slowdown in the economy is going to cool inflation, he would be wrong. The gold bug opined:

That’s actually going to fuel the inflation fire. The real risk is that we end up with a financial crisis and a much more severe recession than the Fed recognizes.

“And then the Fed tries to prop up the economy to try to stimulate, or combat the financial crisis by creating even more inflation,” he warned.

This was not the first time that Schiff has voiced his concerns about the U.S. economy. At the end of last year, he said that inflation was about to get much worse, and the U.S. dollar will face one of its worst years ever. In October last year, he said the dollar will crash and the U.S. is going to default on its debt. He also predicted that the Federal Reserve’s action could lead to market crashes, a massive financial crisis, and a severe recession.

Do you agree with Peter Schiff about the U.S. economy? Let us know in the comments section below.