The current demolition of some of the major banks in the country, as well as the need for some form of federal investigation has recently brought forth discussions that would identify the best ways to safeguard the economy. Peter Schiff, a prominent economist, went on to compare this episode to the financial crisis of 2008, where he found that increasing regulations towards banking actually contributed to the worsening crisis of the economy.
A far deeper analysis of the shutdown of the Silicon Valley Bank by a bunch of economists, which included Schiff, revealed that around 190 banks in the country were at risk of a depositor-driven collapse. It was further highlighted that the monetary policies which were penned down by the central banks could potentially hurt several long-term assets such as mortgages, and bonds- which would then create losses for the banks.
Peter Schiff Believes Added Banking Regulations Have Harmed The Economy
The financial crisis in 2008 was majorly driven by the collapse of the entire housing market. However, Peter Schiff believed that the crisis was caused by extra government regulation. Schiff also highlighted that the US government had introduced completely new banking regulations after the financial crash of 2008- whilst promising that whatever had taken place during that period would never be repeated again. It must be mentioned that finding the perfect balance between financial institutions and the regulations is quite important, especially for Schiff- for the regulators in Puerto Rico had closed his own bank down on 4th July 2022.
At that time, Crypto Twitter had reminded Peter Schiff as to why millions of people around the world were openly vouching for Bitcoin adoption in their attempt at financial freedom. On the other hand, several crypto entrepreneurs have taken this situation and started talking about a massive comeback by the cryptocurrency. Former CTO of Coinbase, Balaji Srinivasan, has also predicted that Bitcoin could reach a price of $1 million within 90 days.