Investment adviser Doug Casey recently appeared on Reason TV to discuss the current state of the US economy. He did not paint a rosy picture, saying that things are “building up to a catastrophe of historic proportions.” Doug made some stark comparisons between the current situations in American and conditions leading up to crises in Greece and Argentina, and even the Great Depression. As a way of warning, he criticized Greeks who failed to see the warning signs and act before it was too late.
But all is not gloom and doom. Doug sees opportunity in the pending economic crash, and he points to gold as a “great value.”
This article was written by Laurynas Vegys and originally published by Casey Research. Any views expressed do not necessarily reflect the views of Peter Schiff or SchiffGold.
Silver is down 7.1% this year. Will this weakness persist? To find out, let’s look at the key factors in the silver market this year.
- Like gold, silver fell as the US dollar rose on the back of expectations that the Fed will hike rates.
- World demand for physical silver fell 4% in 2014, largely due to a record 19.5% drop in investment demand.
- Silver exchange-traded funds (ETFs) did not see big liquidations in 2014. ETF holdings grew by 1.4 million ounces and recorded their highest year-end level at 636 million ounces.
The first two factors helped push silver 19.9% lower last year. That’s more than gold or any other precious metal fell. Despite this, silver production rose 5% in 2014. That added to the pressure on prices.
Mainstream pundits regularly scoff at Peter Schiff when he insists that real inflation is higher than the official Consumer Price Index (CPI), but an AP report this week vindicates his position.
During a recent interview on MSNBC, Schiff insisted that money printing by the Federal Reserve has already created a lot of inflation. He also believes the Fed must continue its inflationary policies. But the host scoffed, disputing the notion that the introduction of all these new dollars is necessarily inflationary.
I feel this is the refrain we’ve been hearing from gold advocates for a long time, especially since 2008 – that inflation has to go up. But when we look at actual consumer prices, they’ve been very muted…”
Peter Schiff spoke with CNBC Asia last night about why the consensus is wrong – the Federal Reserve is not going to raise rates significantly in September. And if it does, it will likely drop them back down to zero before too long. Instead, Peter argues that investors should be preparing for a fourth round of quantitative easing.
“Let’s say you want to start a business. Just start it in Puerto Rico. Why would you start it anywhere else?” This is what Peter Schiff told CNN Money in an article published yesterday. Peter and John Paulson are two of many successful investors CNN mentions as moving their businesses – and eventually themselves – to Puerto Rico.
CNN floated the idea that Puerto Rico could become the next Singapore by continuing to attract businesses with the tax advantages. Peter was the focus of their article:
Peter Schiff moved his asset management firm from Newport Beach, Calif., to San Juan in 2013. Schiff has bought a house in the Ritz Carlton compound just outside San Juan and water is not a problem for him. He plans to move there once his son graduates from high school. Individuals must live in Puerto Rico for 183 days a year to qualify for tax breaks.
“But his company is already enjoying financial benefits, paying a low corporate tax rate of 4%. In California, Schiff’s firm had to pay the U.S. corporate tax rate, which is about 35%. He says tax breaks like those encourage him to create more jobs, which Puerto Rico badly wants.
“‘I’m saving a lot of money,’ says Schiff, CEO of Euro Pacific Capital. ‘It’s the closest thing to renouncing your U.S. citizenship without actually doing it…You’re still an American, you’re just out from under the IRS.’
This article was written by Dickson Buchanan, SchiffGold Precious Metals Specialist. Any views expressed are his own and do not necessarily reflect the views of Peter Schiff or SchiffGold.
With gold’s recent volatility and price drop, we’ve heard a lot of noise from pundits and analysts. Consequently, this seems like a great time to ask certain basic questions about this oft misunderstood market. For example, just how big is the gold market? Where does gold fit into the modern financial landscape? Why does gold still matter today?
To start, let’s consider the size of the global market for gold.
Michael Lombardi of Profit Confidential calmly explains the difference between the paper price of gold and the physical price of gold. Paper gold contracts traded on the COMEX and other speculative markets can significantly influence the nominal price of gold from day to day, as we saw with the sharp downturn in the dollar price of the metal this summer. Conversely, physical buyers are simultaneously paying some of the highest premiums ever for gold, because the supply of the metal is so limited. In fact, gold production has gone down in 2015, while demand in both the US and Asia has been growing.
Lombardi reminds us that in the end, gold is a physical commodity, and basic supply-demand dynamics will be the ultimate arbiter of its value. This point can’t be emphasized enough, but mainstream investors tend to ignore it and get distracted by the dollar price of gold. This dollar-centric mindset ultimately prevents investors from seeing the reasons to own physical gold for the long-term, which is the most prudent reason to buy.
Stefan Molyneux interviewed Peter Schiff on Freedomain Radio. In this hour-long conversation, Stefan and Peter cover the gamut of essential economic issues: the gold market, hidden inflation, the so-called US economic “recovery,” and the ultimate death of the US dollar. This is a great video to catch up on nearly every hot-button issue in the media, from China’s economy to Donald Trump’s campaign to Puerto Rico’s default to American’s misunderstanding of high minimum wage.
South Koreans have embarked on a gold buying spree.
Residents of the Asian country are on pace to purchase a record amount of gold in 2015. By year’s end, total sales will likely top 1 trillion won ($860 million) based on first-half sales through Korea Gold Exchange 3M Co Ltd, the country’s largest gold merchant.
In his 100th podcast, Peter Schiff looks at the latest lousy data from the labor market. Last quarter’s wage growth is the worst since the government started recording it in 1982. He also discusses the disparity between the paper and physical gold markets, and the reactions his brokerage and metals clients have had to the growing bubble of the US dollar.
You have more paper gold trading relative to the actual physical supply than ever before… But in the real, physical [gold] world, the actual buyers – it’s skyrocketing. The mints are running out of supply. Orders are getting backed up… Nobody is calling to sell. Everybody who’s calling is calling to buy more… On the other side of the coin, people who have brokerage accounts and asset management accounts, most of the calls I’m getting now are from clients who are wanting to sell…
“My Canadian clients who hold the same stocks as my US clients, their statements are going up. Because their statements are in Canadian dollars… But people should react the same way, because this is a bubble in the dollar. This is a bubble in confidence in the US recovery that doesn’t exist. Confidence that the Fed has finished QE, when they’ve only just paused. Confidence that they’re about to embark on a rate tightening cycle, when I don’t think we’re anywhere near that…”
