Peter Schiff: Dollar Collapse Soon

Peter Schiff believes the collapse of the U.S. dollar is imminent, and that it'll happen sooner rather than later. He believes it will happen before Obama leaves office, even if he's a one-term president.

Schiff is quick to add the U.S. dollar won't fall every day or period of time, but its overall trajectory will be down, and even with some periods of strengthening, there's nothing to keep it on it precipitous fall off the edge of the cliff.

Part of the reason the U.S. dollar hasn't completely collapsed, according to Schiff, is the continual investment of foreign governments to keep it strong.

For those governments, if the dollar falls too much, it will have a negative impact on their exports, which would of course hurt their domestic economies. So they continue to invest in the dollar through buying up U.S. debt in hopes there will be an actual rebound in the value of the greenback from market forces.

The longer foreign governments prop up the dollar, the longer there will be large global imbalances, which won't be solved until the U.S. dollar falls in value.

When the dollar loses value, the price of everything goes up, as it takes more dollars to buy the same thing. This will be true of everything; including commodities.

Food and energy usually lead the cost increases, and that has consequences because if people are spending most of their money on food and energy, they have much less, if any, to spend on other products and services.

This could affect corporations in the U.S. because if the cost of debt begins to rise and consumers aren't spending money on their products, you'll eventually see the share prices of stocks fall along with the value of the U.S. dollar as it collapses.