Despite some signs to the contrary, many are arguing that America, under Trump, is facing its worst financial crisis since the 1939 great depression. One person making that argument is Peter Schiff, who told Fox News.

Schiff noted that the upcoming event will make 2008 look like a “Sunday school picnic”. He also claimed that unlike 2008, this won’t be a global but an American issue.

So what’s going on?

Faux growth

You may be aware that the US economy actually grew in the third quarter, as the White House’s ‘Rapid Response’ team highlighted:

There’s a problem with this, however, and it’s that while the economy is ‘growing’, the value of the dollar is diminishing. The following graph demonstrates what happens when there’s more money but that said money is worth less:

There can be certain trade benefits to a country’s currency devaluing, with the most obvious being a boost for exports. However, as YouTube channel, How Money Works, detailed in the following video, America isn’t a big exporter. It’s actually the world’s biggest importer. In other words, a weaker dollar is incredibly bad news for Americans who want their treats and creature comforts.

Reserve

A key driver of all this is that the dollar is losing its status as the ‘global reserve currency’ — i.e., the currency which people use to trade and invest with. That status made the dollar valuable, and in turn that made America rich.

Nations and investors increasingly see the dollar as a less stable choice, with reasons including the erratic policy decisions of Donald Trump (e.g. the on/off tariffs):

This didn’t begin with Trump, though.

Under successive US presidents, America has been waging economic warfare through sanctions:

To avoid the sanctions, countries seek to make alternative financial arrangements outside of the US sphere of influence. In other words, by throwing its weight around so vigorously, America, with Trump at the steering wheel, has worked off much of its heft.

While the dollar remains the global reserve currency for now, it used to be gold. The way things are going, it will be gold again before too long, as the following graph demonstrates:

Collapse?

We can’t say for certain that the US is heading into its worst financial disaster since the great depression.

We can say Trump is the absolute last person you would want in charge for all that.

The guy is literally asleep at the wheel, and now the warning bells are so loud that even Fox News can’t ignore them:

Featured image via the Canary