Ron Paul: Fed cuts and China tariffs give socialists credibility for 'first time in my lifetime'

• Known for his economic and stock market bubble warnings, the former presidential candidate says the Fed is "doing too much" in the way of easing monetary policy.
• Coupled with Trump's tariffs, Paul says people are starting to listen to socialists.
• "We're so far removed from capitalism," he says. "Yet we get blamed. Socialists come in and say, 'See what you guys did to our economy.'"

Libertarian Ron Paul, a longtime critic of the Federal Reserve and U.S. meddling overseas, describes central bank interest rate cuts and President Donald Trump's China tariffs as interventionist moves "far removed from capitalism."

"It's a real incentive for the socialists to chime in — and for the first time in my lifetime, socialists sort of have 'credibility,'" the former GOP Texas congressman and three-time presidential candidate told CNBC on Friday.

Known for his economic and stock market bubble warnings, Paul, 84, said on "Squawk Box" the Fed is "doing too much" in the way of easing monetary policy. "It is central economic planning, mainly through manipulation of money and credit."

The market expects at least one more Fed rate cut before the end of the year. Fed policymakers reduced borrowing costs for the first time in more than a decade after their July meeting. They cut again last month.

Fed Chairman Jerome Powell — bashed constantly by Trump for not doing enough to easy monetary policy — said on Tuesday the central bank will start expanding its balance sheet again "soon."

"In no sense is this QE," Powell said in a Q&A session after his speech. QE refers to quantitative easing, a bond-buying measure it launched following the 2008 financial crisis. The Fed embarked on several QE programs during and after the crisis.

Fed critics, like Paul, think the Fed stayed in post-crisis mode for too long, artificially inflating asset prices and making investors take on too much risk to get returns.

"Then we get into manipulating trade," Paul said, referring to the import tariffs Trump imposed on China that started the 15-month-long trade war between the two nations.

"We're so far removed from capitalism," the former congressman said. "Yet we get blamed," he added. "Socialists come in and say, 'See what you guys did to our economy.'"

To find balance in the markets, Paul said the U.S. needs to cut spending, get rid of the federal deficit and stop the Fed from "pretending they can do economic planning."

"Unfortunately, that's not going to happen," Paul added. "I believe we're going to see a collapse that will force us to reassess the monetary policy, and that will be very disruptive."

The Fed and White House were not immediately available to respond to CNBC's request for comment on Paul's remarks.