Next US recession will be 'much worse' than the last: Euro Pacific Capital CEO Peter Schiff

Euro Pacific Capital CEO Peter Schiff tells FOX Business that investors are too complacent and instead should be fearing a looming recession that will hit the U.S. economy.

“There is going to be another financial crisis. The next recessions is going to be much worse than the last one,” he said during an interview on “Countdown to the Closing Bell.”

U.S. stocks closed sharply lower Monday with the Dow Jones Industrial Average falling more than 600 points at the lows during the final moments of trading. Investors are spooked by the impact a trade war with China may have on the U.S. economy ahead of the Federal Reserve’s final policy meeting of the year.

The Fed is expected to hike interest rates for the fourth and final time on Wednesday at the conclusion of its two-day policy meeting.

Schiff, a staunch critic of the Federal Open Market Committee, said the Fed will return to a zero interest rate policy, a move he describes as over extended and never should have taken place.

“The minute [the Fed] did that, they doomed the economy and now we’re going to have to reap the whirlwind of what they sow,” he said.

Schiff added taking the fed funds rate to zero will not prevent a recession and will raise inflation expectations.

“It’s not going to stop the bear market and it’s not going to stop the recession, it will probably kick start inflation into a higher gear,” he said.

The central bank’s benchmark federal funds rate influences interest rates across the economy, including the prime rate, which is used by banks to set rates for credit cards and other methods of borrowing.