Peter Schiff, CEO of Euro Pacific Capital, warns that an impending fiscal disaster will figuratively explode in President Donald Trump’s hands.
Low interest rates have helped defuse the United States' debt problems so far, but that won't last for long as rates begin to creep higher.
Schiff told CNBC on Thursday "the debt bomb is going to explode."
"I think the [Federal Reserve] is going to try to inflate its way out of this problem, but it's going to inflate its way into a bigger one," Schiff said.
He said low interest rates have allowed the U.S. to service its debt, but repaying it is almost off the table. Schiff said as interest rates rise and inflation grows, creditors are going to demand a higher premium, CNBC.com explained.
Schiff also criticized Trump's plan to boost infrastructure spending. Schiff said that is not going to help the economy.
"You don't help the economy by spending money," he said. "To the extent that we need to repair our infrastructure, that's a cost that we have to bear," Schiff said.
"The fact that it creates jobs, that's not a good thing because we're diverting resources that we might otherwise have been able to use more productively to make necessary repairs to our infrastructure," Schiff said.
For sure, President Barack Obama left office having added $9.3 trillion to the national debt, the Washington Free Beacon reported.
When Obama took office on Jan. 20, 2009, the outstanding public debt totaled $10.626 trillion. When Obama left office Friday, outstanding public debt totaled $19.944 trillion, an increase of roughly $9.318 trillion, according to numbers from the Treasury Department at USDebtClock.Org, which tracks how much the US debt grows in real time.
The increased debt incurred under Obama equals approximately $75,129 for every person in the United States who had a full-time job in December, CNS News reported.
"The Obama administration put out 3,069 regulations, adding nearly $900 billion in costs to the economy. Obama’s main focuses were fighting global warming and immigration. Obama’s rules added nearly 572,000 pages to the Federal Register, including a whopping 97,110 pages in 2016 alone — an all-time record," the Daily Caller explained.
And American voters are looking to Trump to get such "unsustainable" spending and disorganization with public finances quickly under control.
To be sure, Trump will be a demanding leader who applies the best of his negotiating skills to push for U.S. growth, bestselling author David Horowitz told TheStreet.com.
Trump won’t be an ideological purist like Republicans who support free trade but don't fight for fair trade, Horowitz said. “If you just say, ‘well we're for free trade and we're not going to look at the deals that we make’ -- that's not a good idea,” he said. “We've had an anti-business president now for eight years who doesn't take a hard-nosed attitude towards these deals. Trump is going to get better deals for us, which is still free trade.”
Horowitz's new book "The Big Agenda: President Trump's Plan to Save America" reveals Trump's "first 100 days strategy" to roll back Obama's legislative and executive record.
"Big Agenda: President Trump's Plan to Save America" is available at bookstores everywhere – or get your copy on Amazon – Click Here Now
And to accomplish his agenda, Trump would be wise to appoint a supporting cast of free-market conservatives to his administration, Forbes Media CEO Steve Forbes tells Newsmax TV.
(Newsmax wire services contributed to this report).
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