More Than Just Political Theater

Economist Peter Schiff isn't buying the idea that President Donald Trump's increasingly bold foreign policy declarations are mere distractions. In a post on X this Tuesday, Schiff suggested that Trump's recent statements—claiming "he will be running Venezuela" or threatening to "invade and occupy Greenland"—aren't just attention-grabbing headlines. They're something worse: catalysts that are speeding up the very economic crisis they might be intended to obscure.

Here's the problem, according to Schiff. The U.S. is already facing what he calls a worsening "sovereign debt and dollar crisis." Rather than diverting attention away from mounting economic troubles, Trump's rhetoric is actually hastening the "onset of that crisis."

The Numbers Tell a Grim Story

The context makes Schiff's warning more urgent. U.S. national debt continues its relentless climb, now touching $38 trillion. The interest payments on that debt alone have surpassed the country's entire annual defense budget. Meanwhile, global central banks are quietly reducing their exposure to U.S. Treasuries and other American assets.

The dollar itself isn't looking great either. Leading analysts predict a "controlled decline" over the next five years as the greenback's share of global reserves continues shrinking, pressured by rising deficits and policy uncertainty.

From Venezuela to Greenland

Trump's recent moves have been nothing if not dramatic. Last week, U.S. forces captured Venezuelan President Nicolás Maduro. Trump subsequently announced that American oil companies would invest billions to revitalize Venezuela's oil sector while temporarily managing the country.

Trump has since claimed that Venezuela's interim government, 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 benefiting both Americans and Venezuelans.

He's made similar aggressive statements about Mexico, suggesting that drug cartels, not President Claudia Sheinbaum, effectively control the country—justifying potential military action to combat cross-border drug trafficking.

And then there's Greenland. Trump reignited calls for U.S. control over the autonomous Danish territory, declaring, "We do need Greenland, absolutely. We need it for defense."

Market Confidence Eroding

This kind of rhetoric has consequences. It's further eroding global investor confidence in U.S. Treasuries, the 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 mounting policy uncertainties.

Schiff's point is clear: when you're sitting on $38 trillion in debt and global investors are already getting nervous, making expansionist declarations probably isn't the confidence-building exercise you'd hope for.