Trump's Foreign Moves Aren't Distractions, They Are Hastening The US Sovereign Debt And Dollar Crisis: Peter Schiff

Economist Peter Schiff slammed President Donald Trump’s increasingly incendiary foreign policy rhetoric, warning that it is now more than a mere distraction and was, in fact, hastening the nation’s sovereign debt and currency crisis.

Sovereign Debt And Currency Crisis

On Tuesday, in a post on X, Schiff said that Trump’s latest declarations, such as claims that “he will be running Venezuela,” or threatening to “invade and occupy Greenland,” may be more than just political theater or attempts at drawing headlines.

According to Schiff, such statements come at the time of worsening “sovereign debt and dollar crisis,” but instead of distracting people from these mounting economic woes, they are actively hastening the “onset of that crisis.”

This comes as the U.S. national debt continues to accelerate at an unprecedented rate, touching $38 trillion, with the interest on debt alone now surpassing the country’s annual defense spending. At the same time, global central banks are increasingly paring their exposure to U.S. Treasuries and other assets.

The U.S. Dollar similarly faces a “controlled decline” over the next five years, according to leading analysts, as the greenback’s share of global reserves continues to slip, amid rising deficits and policy uncertainty.

First Trump claims he will be running Venezuela. Now he's threatening to invade and occupy Greenland. Meanwhile, the U.S. is rapidly headed for a sovereign debt and dollar crisis. Rather than serving as a distraction, this behavior may actually hasten the onset of that crisis.

— Peter Schiff (@PeterSchiff) January 6, 2026

Trump’s Behavior Is Hastening This Crisis

Last week, U.S. forces captured Venezuelan President Nicolás Maduro, following which Trump said American oil companies will invest billions to revitalize and boost the Latin American nation’s oil output, while temporarily managing the country.

Trump has since claimed that the interim government in Venezuela, led by Vice President Delcy Rodriguez, will be “turning over” between 30 and 50 million barrels of “high-quality, sanctioned oil” to the U.S., which he said will be sold at market prices for the benefit of both Americans and Venezuelans.

He has issued similar threats against Mexico, saying that drug cartels, and not President Claudia Sheinbaum, were effectively controlling the country, and justifying potential military action to curb cross-border drug trafficking.

Trump also reignited calls for U.S. control over Greenland, which is currently an autonomous territory in the Kingdom of Denmark, saying, “We do need Greenland, absolutely. We need it for defense.”

This rhetoric is further eroding global investor confidence in U.S. Treasuries, the U.S. Dollar and other Dollar-denominated assets. The U.S. Dollar Index (DXY) declined 9.7% in 2025, marking its worst year in almost a decade, amid tariffs, trade wars, and other policy uncertainties.

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