On CNBC Asia last Friday, Peter Schiff explained why he has no doubt that the government will raise the debt ceiling. Of course, this only means more pain in the long-term and eventually a dollar collapse and sovereign debt crisis. If you want to protect yourself from this looming economic crisis, Peter recommends avoiding US markets that depend on consumer spending. Instead, diversify into hard assets like physical gold and precious metals.
“I think [our creditors are] going to flee the dollar, flee the Treasury market. We’re telling the world that default is inevitable. We said if we don’t raise the debt ceiling, then we have to default. That means we can only pay our bills so long as we can borrow the money to do it. But you don’t pay your bills by going deeper into debt… When our creditors realize that…they’re never actually going to get paid back, then they’re not going to keep on lending. Then all we’ve got is the Fed and a printing press.”
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