America’s “debt bomb is going to explode.” That’s according to financial strategist Peter Schiff.
In an interview with CNBC broadcast on Thursday Schiff, President and CEO of Euro Pacific Capital, (EUROPAC) said that while low interest rates had helped keep a lid on U.S. debt, it couldn’t be contained for much longer. Interest rates and inflation are rising, creditors will demand higher premiums, and the country is headed “off the edge of a cliff,” he said.
“I think the [Federal Reserve] is going to try to inflate its way out of this problem, but it’s going to inflate its way into a bigger one,” Schiff told CNBC.
While the U.S. public debt hovers just below $20 trillion—a mark it’s expected to exceed in coming weeks—President Donald Trump has pledged to increase spending on new infrastructure projects. But Schiff speared such plans as a way to help the economy.
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“To the extent that we need to repair our infrastructure, that’s a cost that we have to bear,” he said. “The fact that it creates jobs, that’s not a good thing because we’re diverting resources that we might otherwise have been able to use more productively to make necessary repairs to our infrastructure.”