Even as US stock markets rally and people anticipate a quick recovery as economies open up, a tsunami of defaults and evictions looms on the horizon.
The mainstream narrative has been that although the coronavirus shutdowns have rocked the economy, it’s not a financial crisis like we saw in 2008. Back in April, Peter Schiff said that we were absolutely heading toward a financial crisis and it will be worse than 2008.
“Obviously, if people aren’t earning as much money as they were when they were working, especially small businesses, they’re not paying their loans. So, the banks are not getting interest payments. They’re getting defaults. … When you have a credit bubble, when the economy is built on a foundation of debt, and then something happens to shake that foundation, you have a big problem.”