Peter Schiff: China, Russia buying gold because 'they can read the writing on the wall'

[MannyGlocks]

William Devane...where's old Bill and his Rosland Capital pitch?

When I buy gold, blah, blah, blah...

 

[BSG 75]

Curious why they don't just keep it and wait for that peak.

How do you know they aren't selling some and stockpiling a lot? Mike Maloney in those Hidden Secrets of Money videos says he measures his silver not in ounces but in tons.

Since 2000 gold has outperformed the Dow Jones.

 

[Resist_This]

Schiff will say literally anything to criticize Trump.

You might be thinking of a different schiff for brains - Adam Schiff

 

[User 1234]

You might be thinking of a different schiff for brains - Adam Schiff

I think you're right.

 

[Cavedweller]

Gold, like everything else, is only so valuable as determined by how it is desired by others. Basic laws of supply and demand.

What doesn't make sense however, is why gold is sought after. (Traditionally, not counting the application it is used for with technology today)

It's just a shiny rock, has no practical value or use for the common man and seemingly the only reason why others desire it is because it is an agreed upon method of exchange. The same could be done with any item chosen to act as currency.

Traditionally, gold has been the primary metal used in the production of jewelry, because of it's beauty and malleability. A little more than 50% of gold demand comes from jewelry production.

Gold demand worldwide by industry share 2023 | Statista

The jewelry industry accounted for a 48.7 percent share of global gold demand in 2023, which amounted to about 2,168 metric tons.

www.statista.com

More importantly, gold is valuable as medium of exchange for 2 reasons: 1) It is relatively rare and 2) it cannot be manufactured from something else. Since the supply is limited it maintains its value as a currency.

To understand why this is important, study the history of wampum. It was used as currency by Native Americans prior to the arrival of Europeans. It was valuable because it was rare and hard to produce. But Europeans began to mass produce it and it lost its value as a medium of exchange.

Wampum - Wikipedia

en.wikipedia.org

When the government (or the central bank) can produce as much paper money as it wants, it loses value. The declining value of paper money is disguised as "inflation." But every new paper dollar printed by the Fed reduces the value of every dollar you hold or receive in compensation for your labor. It is indirect taxation.

 

[Member 5605]

I'd post these things too if I owned a precious metals company.

Drive up the demand artificially and sit back and watch your inventory sell at higher pricing. Market manipulation is not a new scheme.

 

[mrblond]

Come on guys, I think if we all chipped in and bought a particle accelerater, we scould turn all those old fishing weights and the leg shot and bullets that will wind up illegal to use inot about 10 cents of gold!

Who is with me!

Fact or Fiction?: Lead Can Be Turned into Gold

Particle accelerators make possible the ancient alchemist’s dream—but at a steep cost

www.scientificamerican.com

 

[gmerkt]

Why are the hawkers of precious metals always so will to exchange it for worthless fiat currency?

Very good point. In this case it's a Fox News story and they aren't in the business of selling metal but Peter Schiff could be considered a shill for gold since he has a company that sells it. However, he's an experienced financial guy who isn't strictly a shill. When I read online posts from Kitco, for example, I have to consider those with a grain of salt because of the conflict of interest. Situation now is, comments from the commercial champions of gold and mainstreet journalism/finance are starting to converge.

My point above was to the guys crying out that gold could reach $4000/oz, so quick, come buy mine!!! Curious why they don't just keep it and wait for that peak.

Because they are in the business of making a profit. They don't make any money in the short term by sitting on it. They have to keep moving it to generate ongoing revenue. My guess is, they are keeping some of it off to the side for the future. There is the buy price and the sell price, and the difference in the middle ("spread") is where the immediate profit is made.

China, Russia and some other countries have stated their desire to over-turn the US Dollar as the reserve currency of the world. And end US financial hegemony and ability to influence events. In this way, Putin is more likely to keep his promises than some well-known leaders in the US are. The US government as an institution has been down-playing (use the word manipulating if you like) gold for a long time. Reason: To keep foreign sovereign investors coming back for ever more US Treasury debt. Gold may be just a glittering rock, but it has very high recognition and acceptance as a store of value over time. I believe the countries trying to wreck the dollar as reserve currency have in mind some kind of common currency. Kind of like the SDR only backed by gold and accepted universally. But nothing is final until it happens.

I've always found it rather laughable that in some type of major incident that someone who is starving, but with a lot of shiny rock, is going to be able to trade that shiny rock for food.

A supply of gold would be for after, not during. You'd have other things for bridging the immediate crisis. The gold is for ensuring that you have something in the after period, because maybe paper assets from the before period had lost their worth.

90% or more of US citizens never think about a financial crisis of major proportions. They go along all their lives thinking of paper money as the only money. They have no personal history to teach them any differently. 40% of them don't have $500 cash to tide them over during a personal emergency, so why would they worry about gold or any other long term consideration? Owning precious metals is like an insurance policy. Any reasonable person who owns it hopes to never have to use it. They do hope that they or their heirs can get money back out of it if need be under whatever circumstances. Here I'm referring to private owners of PM, not traders or speculators who buy and sell regularly.

 

[BSG 75]

I have been hearing the same thing about precious metals since the Carter years....

Look at what has happened to the currency supply since 1984:



We are in a whole different world than we were in before the 2008 financial crisis, much less during the 1970s.

The US economy and population didn't suddenly expand in 2008, quite the opposite. The Fed cranked up the printing presses and started dropping money on Wall Street from helicopters to prop up a system that is starting to fail. Expansion of the currency supply = inflation. We haven't felt it too much yet because we have been sending many of those dollars overseas for TV sets and Chinese junk at Walmart. But eventually those dollars are going to come home to roost.

Meanwhile, look at the national debt since 1980



Before an earthquake stress builds and builds and builds. Everything seems just fine on the surface, the weather is nice, and life is good. But underneath the surface stress is building and building. And then one day the fault line slips, the built up energy is released, and it hits without warning, causing devastation. Just as with geological stress on a fault line, financial stress continues to build. Everything will seem fine until it breaks. Like with an earthquake, no one knows for sure when the next financial crisis will hit. But when it does, as with an earthquake, some will be prepared, and some won't be.

 

[nammac]

Look at what has happened to the currency supply since 1984:

View attachment 616083

We are in a whole different world than we were in before the 2008 financial crisis, much less during the 1970s.

The US economy and population didn't suddenly expand in 2008, quite the opposite. The Fed cranked up the printing presses and started dropping money on Wall Street from helicopters to prop up a system that is starting to fail. Expansion of the currency supply = inflation. We haven't felt it too much yet because we have been sending many of those dollars overseas for TV sets and Chinese junk at Walmart. But eventually those dollars are going to come home to roost.

Meanwhile, look at the national debt since 1980

View attachment 616092

Before an earthquake stress builds and builds and builds. Everything seems just fine on the surface, the weather is nice, and life is good. But underneath the surface stress is building and building. And then one day the fault line slips, the built up energy is released, and it hits without warning, causing devastation. Just as with geological stress on a fault line, financial stress continues to build. Everything will seem fine until it breaks. Like with an earthquake, no one knows for sure when the next financial crisis will hit. But when it does, as with an earthquake, some will be prepared, and some won't be.

Ooopppppssssssss.

 

[Dungannon]

Troubling news in the world of finance: Peter Schiff: China, Russia buying gold because 'they can read the writing on the wall'.

Since China and Russia are the 1st and 3rd largest producers of gold worldwide, stockpiling can also be explained as a strategy for preserving it's trading price.

Top 10 Gold Producing Countries

• China – 399.7 tonnes. For many years China has been the top producing nation, accounting for 12 percent of global mine production. ...
• Australia – 312.2 tonnes. ...
• Russia – 281.5 tonnes. ...
• United States – 253.2 tonnes. ...
• Canada – 193.0 tonnes. ...
• Indonesia – 190.0 tonnes. ...
• Peru – 155.4 tonnes. ...
• South Africa – 123.5 tonnes.

 

[Tarawa86]

My thought is that for gold to be valuable in any 'collapse', enough people would have to agree that it is indeed a worthwhile medium of exchange. I'm not sure modern society would be very quick to do that. If our currency somehow becomes suddenly worthless, and we slide close to a SHTF situation I can't think of any supplies I would be willing to trade for gold. What's it's use case in today's world? Nobody will be making semiconductors or gold chalices, etc. I just don't buy it, so to speak.

 

[CountryGent]

My thought is that for gold to be valuable in any 'collapse', enough people would have to agree that it is indeed a worthwhile medium of exchange. I'm not sure modern society would be very quick to do that. If our currency somehow becomes suddenly worthless, and we slide close to a SHTF situation I can't think of any supplies I would be willing to trade for gold. What's it's use case in today's world? Nobody will be making semiconductors or gold chalices, etc. I just don't buy it, so to speak.

Funny you mention it, because not too long ago I read The Postman* and in said text the chief protagonist is picking through a house for supplies and when finding a safe remarks to himself that he hopes it doesn't contain "something worthless like gold". I know there is a lively debate in preparedness circles on this topic.

* I've never seen the film, but it is often regarded as one of the worst ever made. The book, however, in my humble opinion, was pretty good.

 

[Camelfilter]

My thought is that for gold to be valuable in any 'collapse', enough people would have to agree that it is indeed a worthwhile medium of exchange. I'm not sure modern society would be very quick to do that. If our currency somehow becomes suddenly worthless, and we slide close to a SHTF situation I can't think of any supplies I would be willing to trade for gold. What's it's use case in today's world? Nobody will be making semiconductors or gold chalices, etc. I just don't buy it, so to speak.

Again, it's use would be for AFTER whatever happened. And perhaps for portability during. For "whenever" or "wherever" normalcy pops up again.

For example if the family had to relocate. The value would be for the future. Unlikely near term, think long term.

I agree, not much value during "whatever" calamity, other than the possibility of buying a neighboring ranch/farm out. As a simple example. Unlikely that, however could be possible, if they wanted portability as well.

Obviously heed the signs, if everyone else is picking up stakes, may be a good time to as well.

If you think you can hold out, then stay. Having extra land/stock would be useful near term (if you can work it), or also as a future investment hoping for a return to normalcy. Worst case just as a simple buffer zone.

 

[nammac]

I would think that during a shtf event, that arms and ammo would be of significant barter value. Anything that would be conducive to survival would most likely hold the greatest barter value, in my humble opinion.

But then again I might just be wrrr, wrrr, wrrr, incorrect...

 

[BSG 75]

I would think that during a shtf event, that arms and ammo would be of significant barter value.

Probably not wise to barter something that can be turned against you.

Barter Smarter... Don't Trade Away Guns or Ammo - The Truth About Guns

&#9664Previous Post Next Post▶ Almost everyone in America has watched as southeast Texas bears the brunt of Hurricane Harvey. At the same time, disasters like Harvey happen with some regularity. In the aftermath of disaster, barter skills can save you time and trouble. Or executed poorly, they...

www.thetruthaboutguns.com

Stop: Don't Barter Your Ammunition Away

It's often said that ammunition will be the new currency when the SHTF. Here's why that way of thinking could get you killed.

gundigest.com

 

[nammac]

Probably not wise to barter something that can be turned against you.

Barter Smarter... Don't Trade Away Guns or Ammo - The Truth About Guns

&#9664Previous Post Next Post▶ Almost everyone in America has watched as southeast Texas bears the brunt of Hurricane Harvey. At the same time, disasters like Harvey happen with some regularity. In the aftermath of disaster, barter skills can save you time and trouble. Or executed poorly, they...

www.thetruthaboutguns.com

Stop: Don't Barter Your Ammunition Away

It's often said that ammunition will be the new currency when the SHTF. Here's why that way of thinking could get you killed.

gundigest.com

Well there is that too, just have to make sure you get the drop on any potential criminal activity against you. Never do a deal alone, I prefer the buddy system.

 

[Cavedweller]

My thought is that for gold to be valuable in any 'collapse', enough people would have to agree that it is indeed a worthwhile medium of exchange. I'm not sure modern society would be very quick to do that. If our currency somehow becomes suddenly worthless, and we slide close to a SHTF situation I can't think of any supplies I would be willing to trade for gold. What's it's use case in today's world? Nobody will be making semiconductors or gold chalices, etc. I just don't buy it, so to speak.

People will always need a medium of exchange because barter is not an efficient method of commerce. It may work for limited purposes on a small scale, but an economy cannot run on barter. So, there's that.

Gold is also portable. Although heavy, it's compact. If you have to move, how many #10 cans and crates of ammo can you haul?

Gold should be viewed as a storehouse of value. Throughout history governments, whether monarchies or democracies, have been unable to resist the temptation to debase their currencies. Ours is financing massive deficits through money supply expansion - the printing of paper backed by nothing but the power to tax.

It doesn't take TEOTWAWKI to destroy the value of your savings. Constant money supply expansion ("inflation") can do that.

Quote from an 2007 article by Paul Mladjenovic ("inflation: Rotten to the Core"):
During the hundred-year span of 1812-1912, there was virtually no price inflation as our country strictly adhered to a gold standard. From 1913 to the 1930s, the United States slowly, partially and then completely abolished the gold standard in our economy. The end result was that a dollar that was worth 100 cents in 1913 is now, in 2007, worth less than three cents.

What happened in 1913? Creation of the Federal Reserve Bank.

No one is saying put everything into gold and nothing else. But it has its place in asset protection. Don't buy it if you don't want to. But a little reading on the relationship between the money supply, inflation, and fiat currencies may lead you to an "Ah ha" moment.

​

 

[American123]

Not really. There are few elements that meet the specifications for an ideal money and none do as well as gold. It hasn't been the ideal type of money for 5,000 years for no reason.

Gold likely has been perceived as valuable because it is not entirely easy to obtain. Same could be said for 'precious stones' when at the end of the day they're just rocks, and only as valuable as how others perceive them.

Hence, gold in and of itself has no value, but because others choose to value it, it has value. Just like shiny rings at the jewelry store, some people pay tens of thousands of dollars, they're just rocks and metal.

I'm not trying to bash on folks who are really happy with their gold supply, I simply have never perceived it as valuable beyond what others may be willing to exchange for it, but at that point, I'd be stockpiling something in the hopes that someone else would desire that gold more than what I would desire from them, at that point, it would make more sense to put my effort into procuring what I want originally, rather than something I don't want in the hopes of exchanging it.

Different strokes I guess.

Edit to say, I understand the importance of a medium of exchange, and I do believe that it's dangerous to use any type of fiat currency, for example, crypto currency, WTH, how does that magically have value. Lol, and of course it's not a good idea for the government to be printing money that would reduce the value of the dollar.

 

[Cavedweller]

I simply have never perceived it as valuable beyond what others may be willing to exchange for it,

That can be said of anything.

it would make more sense to put my effort into procuring what I want originally, rather than something I don't want in the hopes of exchanging it.

Gold has the advantage of liquidity. In a pinch it can be sold quickly and easily at market value. Try that with a 5 gallon bucket of rice.