[YouTube Video] Gold & Silver Will Go Up Much Faster When This Happens! A Conversation With Peter Schiff6 min read

In a nutshell

Gold and silver continue to strengthen, with gold approaching $3,000 per ounce and precious metals now representing over 52% of value among top investable assets. In this conversation with legendary investor Peter Schiff, known for predicting the 2008 crash, he argues that gold and silver are entering what could be a permanent bull market as long as fiat currencies exist. Despite recent market pullbacks, Schiff advises investors not to wait for significant dips in gold, suggesting the current $100 retreat from $2,950 is likely “as much as you’re going to get.” For those concerned about missing the gold rally, he recommends silver as still “ridiculously cheap” at under $32/oz and highlights mining stocks as particularly undervalued. Looking forward, Schiff believes precious metals will accelerate their rise once the Federal Reserve resumes expanding its balance sheet, with gold particularly poised to surge when the US dollar inevitably weakens. Here are three key takeaways:

1. Mining Stocks Opportunity: Despite gold’s rise, mining stocks remain significantly undervalued compared to the metal itself, presenting what Schiff calls a gift for investors before an “eventual explosion” in their values.
2. Federal Reserve Dilemma: As inflation strengthens while the economy weakens, the Fed will likely choose stimulating the economy over fighting inflation, potentially driving inflation above 10% rather than back to their 2% target.
3. Dollar Decline Ahead: When gold reaches $5,000-$20,000 per ounce, it will likely coincide with the US dollar losing reserve currency status, leading to higher prices across the economy, increased interest rates, and a collapsing credit bubble.

While these developments suggest difficult economic times ahead, Schiff maintains that precious metals have been in a steady uptrend since the Federal Reserve’s establishment in 1913 (when gold was $20/oz) and will continue rising as long as fiat currencies remain unbacked by gold.

Summary of “Gold & Silver Will Go Up Much Faster When This Happens! A Conversation With Peter Schiff”

Market Overview and Recent Performance

(00:00 – 01:10): The host opens by recalling his January prediction of a market pullback after Trump’s inauguration, followed by money printing and major moves up for gold and silver. He notes February’s monthly closing was pivotal, with major tech stocks like Nvidia and Google experiencing significant weekly drops (9% and 6% respectively) while gold and silver increased their share of global investable assets to 52.4%.

Introduction to Peter Schiff

(01:10 – 03:53): Peter Schiff, who famously predicted the 2008 crash, joins to discuss whether the recent pullback in metals has created buying opportunities, mining stocks, platinum prospects, the possibility of a worse crash than 2008, and the potential permanent bull market for precious metals.

Current Gold Market Advice

(03:53 – 05:34): Asked whether investors should wait for a pullback before buying gold, Schiff advises against waiting, calling the current $100 pullback from $2,950 to $2,850 “about as much as you’re going to get” in this bull market. For those concerned about gold’s price, he recommends silver as “ridiculously cheap” at under $32/oz and particularly emphasizes gold mining stocks as undervalued relative to the gold price.

Mining Stocks Analysis

(05:34 – 08:14): Discussing why mining stocks haven’t matched gold’s performance despite significant moves since July 2023, Schiff cites several factors: analyst negativity toward gold’s future prospects, investor distraction with tech stocks, and Bitcoin ETFs drawing potential mining stock investors away. He believes these factors have contributed to mining stocks remaining undervalued despite strong fundamentals.

Federal Reserve Policy and Inflation

(08:14 – 10:39): The host references Schiff’s previous prediction that the Fed would eventually ignore inflation. Schiff notes that money printers were never truly turned off (with M2 expanding 5% last year) and explains that when faced with the dilemma of weakening economy and strengthening inflation, the Fed will likely prioritize economic stimulation, allowing inflation to potentially exceed 10% while maintaining the narrative that it will eventually return to 2%.

Gold and Silver Price Projections

(10:39 – 12:23): Schiff predicts gold will “move up much faster” when the Fed expands its balance sheet again, particularly when the US dollar begins to decline against other currencies. He notes gold’s strength despite the dollar’s recent strength (dollar index at 107 vs. 75 in 2011) and points out that silver in currencies like the Australian dollar has already exceeded its 2011 high.

US Treasury and Gold Purchases

(12:23 – 14:01): Asked about increasing gold flows into the United States, Schiff doesn’t believe this represents Treasury purchases but suggests it could be private interests buying gold, companies anticipating potential Trump tariffs on metals, or possibly the US government retrieving previously loaned gold.

Future of Currencies

(14:01 – 15:40): For viewers outside the US concerned about their currencies’ futures, Schiff advocates that all currencies should be backed by gold as “real money” to provide discipline to governments that otherwise print money excessively to fund deficits without imposing taxes.

Platinum as an Investment

(15:40 – 19:13): Though historically more expensive than gold, platinum now trades at roughly one-third of gold’s price. Schiff notes this reversal from tradition but doesn’t actively recommend physical platinum, having previously converted his own platinum holdings to silver. He suggests platinum may not always remain cheap relative to gold but hasn’t pushed it as an investment focus.

Economic Outlook and Market Crash Potential

(19:13 – 22:25): Asked if the next economic bust will be worse than 2008, Schiff predicts a more severe crisis marked by the dollar losing reserve currency status, rising consumer prices, higher interest rates, imploding credit bubbles, and a “protracted economic decline.” When gold reaches $10,000-$20,000, it will likely reflect a dollar in “almost free fall.”

Long-term Precious Metals Outlook

(22:25 – 27:34): Schiff suggests the bull market in precious metals will continue “as long as we have fiat currency,” noting gold’s rise from $20/oz in 1913 (when the Federal Reserve was established) to nearly $3,000 today. He criticizes recent budget actions that increase deficits beyond Biden-era levels and raise the debt ceiling to $40 trillion, continuing what he sees as the fundamental problem driving precious metals higher.

Investment Recommendations

(27:34 – 28:03): For investors looking to participate, Schiff recommends his Euro Pacific gold fund (symbol EPGIX), separately managed accounts for larger investors, and a focus on mining stocks over physical metals. For physical metal purchases, he suggests silver over gold at current prices and notes most mining companies produce multiple metals.