Veteran stockbroker Peter Schiff has warned once again that the US currency is doomed and the world will eventually lose confidence in it, which he says should have happened a long time ago.

In the latest episode of Boom Bust, Schiff discussed the fate of the US-China trade deal. The investor said he believes that there will be no second-phase agreement, and noted that Beijing still has leverage over Washington, especially ahead of the elections.

“The real problem is going to be when the Chinese stop buying our bonds or start selling our bonds,” he said, adding that the process might have already started. China used to be the largest creditor to the US government, but it was outpaced by Japan last year. However, Beijing still can use US debt as a weapon, as it holds over $1 trillion of US Treasury securities.

If the dollar falls, the US will no longer be able to afford to buy Chinese products as the prices will spike, according to Schiff.

“When the dollar crashes, I think that’s going to happen, the Chinese will buy a lot more American agriculture, because Americans are going to buy a lot less, because the prices are going to go up,” the investor stated.

“We’re headed for a real crisis, so the problem isn’t China taking advantage of us, it’s that we’ve actually been able to take advantage of them by exporting our overvalued currency for their products. And I think the ability of the United States to continue to do this is coming to an end.”

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