Home > Peter Schiff: Avoid Disaster, Get Out of U.S. Assets (GLD, SLV, IAU, SPY)

Peter Schiff: Avoid Disaster, Get Out of U.S. Assets (GLD, SLV, IAU, SPY)

August 3rd, 2011

If you own dollar denominated assets than you’re a fool. It’s really that simple in the black and white world of American fatalism that is the trademark thesis of Peter Schiff, the CEO of Euro Pacific Capital. “Unfortunately, because we raised the debt ceiling, because we continue to spend money, the cost of government is going to be born by those foolish enough to hold U.S. currency,” Schiff tells Breakout.

In fact, as much as the Wall Street pundits may attack him, Schiff’s long standing affection for gold and other non-U.S. assets has served him well. Accordingly, there’s no strategic shift in sight from the man who’s says economic Armageddon will come because the debt ceiling was raised, not because it (almost) wasn’t.

“You can’t have a portfolio that’s entirely gold and silver, and we don’t,” Schiff says, then lists foreign stocks, non-dollar denominated bonds, commodities and currencies as alternatives. But his go-to favorite, gold, still holds a special place in his heart and has lots more room to rise.

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“If you look at the value of U.S. stocks in terms of gold, the Dow peaked in 2000 at about 43 ounces. We’re now at barely 7 ounces of gold for the Dow (7 x $1650 = 11,550). Ultimately, I think we see that ratio come down closer to 1 to 1,” he says. That would require either a lot more Dow decline, a lot more gold gains, or some combination of the two.

Just playing with some numbers here, if gold and the Dow Industrials both had 75% respective gains and losses from their current levels (approx. $1650/11,550), we’d be looking at $2887 to reach a 1-to-1 Gold-to-DJIA ratio. You can run your own scenarios, but the mere thought of that is chilling.

So what do you do? Watch the full “Breakout” video below:




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  1. Jeff
    August 6th, 2011 at 14:04 | #1

    not sure I understand why you call out CNBC jd. This is not a CNBC show. If you’ve ever watched CNBC they actually give Peter Schiff a hard time. As far as CNBC guests talking their book – duhhh!

  2. jd
    August 3rd, 2011 at 13:42 | #2

    I should add, CNBC has a history of manipulating stocks in my opinion. Like what they are doing right here. They try to get people to buy the stocks they own, to pump their own wealth.

  3. jd
    August 3rd, 2011 at 13:39 | #3

    The only fool is the one buying fools gold.

    This guy is just another right wing nut.

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