After the August CPI report showed price inflation heating up again thanks to rising gasoline prices, Peter Schiff appeared with Jesse Kelly on First TV to answer the question: where are we heading? Peter said this story is going to have a tragic ending.
Gold and silver drifted lower this week before a modest recovery Friday morning, which can be put down to bear closing. Meanwhile, gold hit record levels in yuan and yen terms.
Here’s a breakdown of this week’s gold and silver markets.
The economy is in a slow burn. You can’t even see the flames. But you can smell whiffs of smoke every now and then if you’re paying attention. In this episode of the Friday Gold Wrap, host Mike Maharrey calls attention to that smoke with a breakdown of August’s CPI and some other data that came out this week. He also busts a myth about silver.
Russia and the Saudis are driving up oil and diesel prices. But these moves are likely to undermine the rouble more than they undermine the dollar, euro, and other major currencies. Therefore, higher energy prices will rebound on the Russians this winter: if they shiver in Germany, they will freeze in Russia. If the dollar is king of the fiats, the rouble is just a lowly serf.
There is little doubt that Putin and his advisers are aware of this problem. Plan A was to introduce a new gold-backed BRICS currency which might be expected to weaken the dollar and euro relative to the rouble. Plan B was more drastic: to back the rouble itself with gold. This is the financial equivalent of dropping a hydrogen bomb on the dollar and the global fiat currency system upon which it is based.
A commenter on the SchiffGold Facebook page recently asserted that silver coins are “junk.” Why? Because as he put it, “silver is not rare,” and, “The silver/gold ratio investment premise is obsolete in this industrial, computerized and AI world.”
What should we make of these assertions?
The federal government charted a surprising budget surplus in August.
But don’t be fooled. The feds didn’t miraculously fix their deficit problem.
The Biden administration continued to spend money at an unsustainable pace last month. The surplus was merely a function of the reversal of student loan forgiveness.
About that disinflation…
It was transitory.
As we predicted, a jump in gasoline prices helped drive the August Consumer Price Index (CPI) higher, throwing cold water on the disinflation narrative.
The Federal Reserve is losing money.
That means the American taxpayer is losing money.
In most instances, a business bleeding red ink has a big problem and could ultimately go under. Not so for the Fed. In fact, losing money isn’t a problem for the central bank at all. But it is a big problem for the US government.
Chinese gold demand improved on multiple fronts in August.
China ranks as the world’s biggest gold market.
Peter Schiff recently appeared on Nino’s Corner with David Nino Rodriguez to talk about the trajectory of the economy. Peter explained why the dollar is doomed to crash and what we can do to prepare. He also emphasized that the powers that be have managed to kick the can down the road for a lot longer than he expected. But you can’t kick the can down the road forever. Eventually, you will run out of road.
