The Truth about Gold and the American Dream (Audio)

The SGT Report recently interviewed Peter Schiff about the US economy and the gold market. This forty-minute conversation covers a lot of topics, including:

Highlights from Peter’s responses:

“I don’t know how the Dutch were able to succeed where the Germans failed [in repatriating their gold]. I think we need more proof that actually in fact happened… Gold is rising on the back of both a rate cut in China and more promises by Draghi to create more inflation fast in Europe. The one thing central banks can deliver on is their promises to create inflation. They can’t do anything else. They certainly can’t grow the economy or create good jobs, but they can certainly raise everybody’s cost of living…

“Look at what Putin is doing. A lot of people thought that Russia was selling gold to defend the ruble. Instead, they were buying even more gold. I think the smart central bankers are doing just that. They are preparing to win the currency wars by buying as much gold as they can…

“Ben Bernanke and Janet Yellen are just following the playbook that Alan Greenspan wrote. Now he admits that the playbook is no good and that you should buy gold. This is the first time that you should actually listen to Alan Greenspan and buy gold. One thing I disagreed with – he said gold was currency… It’s not currency, it is money. Dollars and euros are a poor substitute… Legitimate currency is backed by real money. So when the dollar was redeemable with gold, the dollar was currency and gold was money. But now that dollars are redeemable in nothing, they’re Federal Reserve IOU-nothings. You have the choice between owning a fiat currency or owning real gold. I think right now the only thing that’s keeping gold from going ballistic is the false belief that the Fed is the lone hold-out in this race to the bottom. That the Fed is out of the QE business and is going to be raising rates. When people figure out that is wrong… The only safe-haven standing in a monetary sense is going to be gold…

“[My] big forecasts of a dollar crisis, gold $5,000, a bond bubble bursting – those haven’t happened yet. But those are the endgame. By the time those predictions come true, it’s too late to do anything about it. It’s too late to protect yourself, because that ship will have long sailed. I’m trying to warn people in advance…

“I think that gold is going to finish the year positive. For all the negativity, all the nay-sayers, here’s one thing that people see to be unanimously agreeing on: that gold’s going to crash. That gold was bubble, it’s popped, and it’s got no place to go but down. You have overwhelming consensus about it, yet gold’s not going down. It’s not soaring to make new highs, but given all of the sentiment against it… why is gold not going down? Why is gold back above $1,200? … That’s because it’s not going to go down. It’s going to go way up…

“The real reasons they want inflation are twofold. One, they want to continue to blow air into financial bubbles. They know that without more inflation, stock markets could come down, real estate markets could come down, banks could fail… More importantly, they want to wipe out debt. They want to wipe out the debt of overly leveraged corporations and individuals… But most particularly, they want to wipe out the debt of the governments…

“Politicians the world over have promised the moon to voters to win their votes. To get elected they make promises to the taxpayers that they can’t keep. Nobody wants to admit that they can’t fulfill these promises, that they can’t repay their debts. So what are they going to do? They have two options. They can default, which is political suicide… Or they can inflate. Default is better economically, but inflation is better politically, because it provides cover to the politicians…

“Gold’s going higher whether or not the Swiss pass this initiative. There are plenty of people in Switzerland that will put themselves on a gold standard if they can’t force the government on one. Swiss will buy gold. In fact, that’s basically what Mario Draghi said today when promising more inflation in Europe. Well, he’s also promising more inflation in Switzerland…

“The American dream, really, historically, was the ability of any individual, no matter to what circumstances they are born… could rise to be anything they want. From humble beginnings, you could become a captain of industry, you could become the President of the United States. It’s not a function of class… It’s really about the individual, and their own character… There’s nothing that’s going to limit them… Certainly it’s not dead, but for a lot of people it’s dormant or it’s in a coma…

“My gold company has really been growing. We’ve gained a lot of market share. We’ve become a much bigger factor in the gold market… [We’re dedicated] particularly to providing our clients with some of the most competitive, the lowest prices they can find… No bait-and-switch, no high-pressure sales tactics. Just quality service at a low price…”

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