Economist Peter Schiff warns of US recession risks

Economist Peter Schiff has issued a warning regarding the future of the US economy, specifically highlighting risks associated with rapid growth in the artificial intelligence sector. Schiff suggests that rising borrowing costs could pressure large-scale technology investments, potentially leading to an AI bubble burst that would expose broader economic vulnerabilities.

While Schiff anticipates a recession, prediction market data from Polymarket shows a divergence in expectations. Investors currently place the probability of a US recession in 2026 at just 7%, a significant decrease from a peak of 37% in March. However, the likelihood of a recession in 2027 rises to 35% according to the platform.

Schiff noted that a potential economic downturn could support investments in gold and gold mining companies. Uncertainty remains high as preliminary third-quarter growth data from the US Bureau of Economic Analysis has yet to be released.