This morning I reached out to my old friend and colleague Peter Schiff to talk about some uncomfortable truths that very few people are discussing right now.

I wrote to you about this yesterday: banks are in trouble. You can’t expect to shut down practically an entire world economy that is in debt to the tune of $250 TRILLION and not expect massive loan defaults.

The last financial crisis in 2008 was caused by a spike in loan defaults. We’re about to see another spike of loan defaults due to all the layoffs and business closures… only this time the problem is much, much bigger than it was in 2008.

And Peter and I discuss some potential scenarios.

Be forewarned, they’re not pleasant.

Think about it like this: before the last financial crisis, US government debt was ‘only’ about $9 trillion. It’s nearly tripled since then.

The Federal Reserve’s balance sheet prior to the last crisis was $850 billion. It ballooned to $4.5 trillion, more than 5x as much.

This means that we could see US government debt reach $40 to $50 trillion, the Fed’s balance sheet exceed $20 trillion.

Could that possibly have negative implications for the US dollar? You bet. Peter and I talk about what might happen with the dollar, and more.

You can listen in here.

* Editor’s note: As you’ll hear in the podcast, Peter promotes a number of his businesses, mutual funds, etc. We need to be clear that those comments are his alone, and that we are not recommending in any way that listeners make any investment with any of Peter’s businesses.