Schiff Tackles Dedollarization on Resource Talks

Peter recently appeared on the Resource Talks Youtube channel to discuss the future of gold and the U.S. economy. In his interview, which makes up the first portion of the show, Peter specifically speaks to the looming financial crises facing the United States, unsustainable debt levels, the inevitable collapse of the dollar, and the role of gold in such an environment.

Peter predicts the price of gold will increase, and the election could contribute to the rise:

“It’s actually going to go a lot higher regardless of who wins the election. I think that the potential is probably even higher if Kamala wins. But, you know, we’ve now closed three days in a row above 2,500. We set a new record high intraday today. … We still closed at a new closing high on the day. Very bullish.”

This rally could be threatened by the Fed’s future decisions, but it’s unlikely they’ll behave in a way that would tank the price of gold:

“If the Fed hiked rates in September instead of cutting them, I think gold would tank. But they’re not going to do that. But gold would go down less than the stock market, so in that respect, you’d be able to buy more stocks with your gold. … If the Fed hiked rates and it caused a crash, then they would cut rates. They would have to rescue the market from what they just did.” 

Peter explains how Europe and Japan unfortunately mimicked the Federal government and Federal Reserve:

“The dollar is relatively strong on a relative basis— not on a purchasing power basis. It’s been getting clobbered. That’s why prices are up so much. But, the same thing has been happening in Europe and Japan. … The Europeans did the same mistakes as the Americans. Their central bank did the same foolish thing as our central bank. Their governments ran big deficits, and their central banks monetized it. So everybody’s got inflation, because everyone caused inflation.”

Things may be lining up for the dollar’s value to start falling relative to the euro and yen:

“When the dollar starts to lose value against the euro—which is starting, and it’s been especially weak against the Swiss franc, and it’s now weakening finally against the yen— that is going to accelerate the rally of gold. And as the dollar really starts to fall, that’s going to accelerate the rush to get out of the dollar.” 

History may repeat itself if the dollar starts weakening soon, as it did before the Great Recession:

“We got close in 2008 before the financial crisis when the dollar index got to 70, when you could only get 80 Japanese yen with the dollar, and the dollar was really sinking. The financial crisis actually kind of gave us a reprieve. I think that’s going to happen again, where the dollar really starts to fall, and it really starts to put a lot of upward pressure on interest rates and consumer prices. It’s going to put the Fed between a rock and a hard place.”

What’s gold’s role in this economy?

“As people start to realize how much inflation there is, and how much value the dollar is going to lose if they hold it, they want to get rid of their dollars, and they want a store of value. That’s gold. … Gold’s value is that it’s a very useful metal that has properties that give it a lot of value. And so when you own gold, you own those properties. And somebody could take that gold in the future and use it to make a computer chip, or use it to make a piece of jewelry, or use it for a dental implant, or in aerospace. There are all sorts of uses for gold.” 

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