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Original Analysis

POSTED ON August 20, 2015  - POSTED IN Key Gold Headlines, Original Analysis

company-addison-qualeThis article was submitted by Addison Quale, SchiffGold Precious Metals Specialist. Any views expressed are his own and do not necessarily reflect the views of Peter Schiff or SchiffGold.

Most people who buy physical gold and silver these days tend to be those who are worried about our financial system.

They see unbacked, untrustworthy fiat currencies as an intrinsically flawed foundation for an economy. They see skyrocketing debt that doesn’t stop rising. They see an overvalued stock market, inflated by repeated rounds of quantitative easing. And they see world governments that cannot be trusted to act economically responsible – especially in light of how things have played out recently in Cyprus and in Greece. These are all good reasons to distrust and opt-out of the banking system and put one’s wealth in physical gold and silver instead.

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Of course, not everyone is onboard with these ideas. Many do not see the sky falling so quickly and are still hopeful that our financial system is going to pull through okay.

Regardless of whether you are a gold bug or maintain faith in the “system,” there is still a very strong argument for holding up to 5-10% of your portfolio in precious metals — something that Peter Schiff has always recommended. And that is simply the argument of diversification.

POSTED ON August 20, 2015  - POSTED IN Original Analysis, Videos

After the Federal Open Market Committee’s meeting yesterday, the markets finally started to wake up to the fact that Janet Yellen’s Federal Reserve has no clue when or how it will raise rates. Analysts are starting to realize what Peter has said before – how will the Fed deal with the next recession if rates are stuck at zero? Of course, nobody but Peter is pointing out that a fourth round of quantitative easing is the Fed’s only solution.

The price of gold moved up on the news, while stocks were choppy. As usual, Peter Schiff took the time to dig into the latest economic data that reveals the economy is in no condition for the Fed to raise rates in September, let alone this year. This is just one of many reasons why now might be the perfect time to invest in physical gold.

Case in point was the Empire State Manufacturing Index that came out earlier this week on Monday. This is for August. Last month in July, that index was 3.86%, which is a really low number. The consensus was for a slight improvement to 4.75%. That’s what everybody thought. Well we actually got minus 14.92%… It wasn’t even in the realm, anywhere close. The lowest forecast that anybody made was 3%. Positive 3%.”

POSTED ON August 18, 2015  - POSTED IN Original Analysis

company-addison-qualeThis article was submitted by Addison Quale, SchiffGold Precious Metals Specialist. Any views expressed are his own and do not necessarily reflect the views of Peter Schiff or SchiffGold.

I recently attended the Freedom Fest Conference in Las Vegas this past month. During a panel discussion that included a number of Austrian School economists, it was remarked with certainty that the United States dollar (USD) would eventually collapse. This invited the inevitable question: “Since the USD is the world’s reserve currency, what will replace it once it collapses?”

A conventional view out there – one espoused by many free-market economists even – is that just as the US displaced the United Kingdom as the world’s superpower and the dollar displaced the pound following World War II, a similar course of events is bound to take place. The consensus seems to be that China is waiting in the wings and will eventually emerge as the world’s next superpower, with the yuan displacing the USD.

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POSTED ON August 17, 2015  - POSTED IN Original Analysis

This article is written by Peter Schiff and originally published by Euro Pacific Capital. Find it here. Peter discusses the real lessons to be learned from China’s yuan devaluation of last week, which garnered so much mainstream attention. Peter brought up some of these points in a CNBC interview last week.

China’s recent move to devalue the yuan has sent shock waves through the global financial markets and convinced most observers that a new front in the global currency wars has begun. The move has caused many to envision a new round of competitive devaluations around the globe in which the race to the bottom will intensify. In this scenario they envision that the US dollar will solidify its standing as the only strong currency. This misses the point entirely.

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In the past, most of the action in the “currency wars” had been focused on the efforts that many nations undertook to prevent their currencies from rising against the US dollar, which itself was being weakened by a perpetually easy Federal Reserve and persistently negative US trade and budget deficits. But with the dollar now strengthening significantly, the Chinese government has become concerned that the yuan, which has remained largely tethered to the dollar, had become too strong against other currencies, particularly its primary trading partners in Asia and the Pacific. To remain competitive locally, it decided to ease the tether to the dollar and instead let its currency float more freely. The purpose and implications of this significant pivot has largely escaped the US media. In reality, the move raises the likelihood that the yuan will rise significantly when the dollar resumes its long-term bear market, not that it will remain weak forever.

POSTED ON August 12, 2015  - POSTED IN Key Gold Headlines, Original Analysis

company-addison-qualeThis article was submitted by Addison Quale, SchiffGold Precious Metals Specialist. Any views expressed are his own and do not necessarily reflect the views of Peter Schiff or SchiffGold.

So the People’s Bank of China (PBOC) just weakened the yuan fix to the United States dollar by the most on record – 1.9%. A central bank has devalued its currency, you say? Well, duh! With apologies to GEICO, it’s what central banks do. Apparently with exports suffering and their economy struggling to grow, something had to give. Devaluing the yuan immediately gives its export sector a boost. The hope is that this boost offsets whatever capital outflows result from a now weakened currency.

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The move recalls another recent currency devaluation on the other side of the world. This time last year, the Swiss National Bank still wholeheartedly protested that it would never let its currency fix of the franc to the euro revalue. It continued declare as much right up until the week that it dropped that very peg. Me thinks it doth protested too much.

POSTED ON August 11, 2015  - POSTED IN Original Analysis, Videos

Peter Schiff’s digs into Friday’s jobs numbers and the great expectations for a September rate hike from the Federal Reserve. In this Schiff Report, Peter walks us through the options Janet Yellen has right now and the repercussions they will have on the economy and US stocks.

This year, 2015, is probably going to be the weakest year of the entire recovery. And that’s with interest rates at zero for the entirety of the year. If the Fed really begins to raise interest rates, what’s going to happen in 2016? Obviously, we’ll be in a recession. If the Fed raises rates now, we’ll be in a bear market in stocks…”

POSTED ON August 10, 2015  - POSTED IN Original Analysis

This article is written by Peter Schiff and originally published by Euro Pacific Capital. Find it here.

Over the past few years, observing changes in Federal Reserve interest rate policy has been a little like watching paint dry or grass grow…only not as exciting. That’s because the Fed has not changed its benchmark Fed Funds rate since 2008 (Federal Reserve, FOMC). So with nothing else to talk about, Fed observers have focused on the minute changes in language that are included in Fed Policy statements. The minuscule revision in the July statement was the inclusion of the word “additional” to the “labor market improvements” that the Fed wants to see before finally pulling the trigger on its long-awaited rate increases. That should lead to a discussion of what kind of “additional” improvements those could be.

Janet Yellen

According to a good many Main Street analysts, the labor market has already improved significantly over the past 5 years. During that time, the unemployment rate has declined from 9.8% to just 5.3% (Federal Reserve Economic Data (FRED), St. Louis Fed). In the FOMC’s June 2015 Summary of Economic Projections, Committee participants’ estimates of the longer-run normal rate of unemployment had a central tendency of 5.0% to 5.2%. But that’s not the kind of labor market success that has spurred Janet Yellen to action. She is looking for “additional improvements.”  Since it is very unusual for the unemployment rate to fall below 5% (having done so in only ten years in the 45 years since 1970), it must be that she is looking for improvements in other employment metrics, like wage growth, labor force participation, and the ratio of full time to part time job creation. On those fronts there is very little to inspire confidence.

POSTED ON August 5, 2015  - POSTED IN Key Gold Headlines, Original Analysis

company-dickson-buchananThis 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.

POSTED ON August 4, 2015  - POSTED IN Original Analysis, Videos

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…”

POSTED ON July 31, 2015  - POSTED IN Original Analysis

This article is written by Peter Schiff and originally published by Euro Pacific Capital. Find it here.

While the world can count dozens of important currencies, when it comes to top line financial and investment discussions, the currency marketplace really comes down to a one-on-one cage match between the two top contenders: the US dollar and the euro.

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In recent years the contest has become a blowout, with the dollar pummeling the euro into apparent submission. Based on the turmoil created by the European debt crisis and the continuing problems in Greece and other overly indebted southern tier European economies, many investors may have come to assume that euro boosters will be forced to ultimately throw in the towel and call off the entire experiment, thereby leaving the dollar completely unchallenged as the champion currency, now and for the foreseeable future. This is a stunning turnaround for a currency that was seen just a few years ago as a credible threat to supplant the dollar as the world’s reserve.

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