Schiff on Macroscopic: The Dollar Is Doomed

On his recent appearance on The Macroscopic Podcast, Peter lays out a constitutional case for sound money and connects it to current policy choices that he says are wrecking the dollar. He walks through the legal foundation for gold and silver, criticizes the Trump administration’s mix of tariffs and debt-driven policy, and warns that global actors are already voting with their balance sheets.

He opens by reminding listeners of the monetary limits the framers placed on federal power and why that matters today:

Well, I guess if you’re going to describe it as heresy, it’s more heresy to the conventional wisdom because I believe that in the monetary system that was established by the framers of the Constitution. And if you understand the Constitution, they have very limited powers given to the federal government. They only have the power to coin money and regulate its value. And by coining money, they mean gold and silver, which is the only metals which the states are authorized to make legal tender. The federal government is not authorized to make anything legal tender.

From that legal frame, Peter moves quickly to policy consequences, arguing that current measures are effectively designed to weaken the currency. He makes no bones about who he thinks is responsible for accelerating the dollar’s decline:

The dollar is going to get clobbered. Everything that Trump is doing is bad for the dollar. The tariff policy, the big beautiful bill, the disaster that he’s doing with Fannie and Freddie May, what he’s doing with the Fed, I mean, it’s probably the worst combination of policies that I’ve ever seen under any presidential administration. So if your goal was to destroy the value of the dollar, the Trump administration is most likely to succeed more than any other administration I’ve seen.

He frames the current fiscal picture as one that cannot be sustained, and he sees the rhetoric around rate cuts as an implicit admission of insolvency. In Peter’s telling, calls for easier money are really about hiding an unsupportable debt burden:

I think it’s pretty obvious that a sovereign debt crisis is coming. I mean, one of the reasons that Donald Trump publicly admits for the Fed to cut rates is because the US government has so much debt and, you know, it’s a burden to service the debt at the current rate of interest and that the Fed needs to lower rates to bring down the cost of servicing our debt. Well, that’s, you know, really an admission that the debt is unsustainable. I mean, we obviously can’t repay it, but Donald Trump is saying we can’t even service it.

That political meddling, Peter warns, is driving an important shift in what foreign central banks hold. He points to rising central bank gold purchases as a direct response to diminishing confidence in the dollar and to a potential constitutional fight over Fed independence:

And look, that is why foreign central banks are getting away from the dollar. That’s why gold is at $3,550 because foreign central banks are buying it, and they’re selling their dollars to pay for it. So the dollar share of global reserves is shrinking and continues to shrink, and the pace is going to accelerate, especially if the Fed rules or the Supreme Court rules in favor of Trump that he can fire any FOMC member that he wants because a truly independent Fed is not constitutional. If that happens, that will just accelerate the exit. They won’t be walking away from the dollar, they’ll be running.

He closes the segment with a firm prediction that the world is moving back toward a gold-centered system, arguing from history and from what he sees as the failures of fiat money to deliver stable growth and liberty:

I think there’s no question that the world is headed back to a gold-based monetary system. It’s the only monetary system that’s ever really worked. The one that we have now that we’ve had for the past 50 years has only worked in the sense that we’ve been able to use it, but it’s responsible for these massive global imbalances, the growth of government, the explosion of debt, the high inflation. So if you want to have a sound monetary system for maximum economic growth and prosperity and individual liberty, then gold is the only known way of delivering it..