Peter Schiff: Beanie Babies, Bitcoins, and What’s next?
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Peter discusses the debt ceiling saying, “We blew through 20 trillion in national debt. The debt is not good for the dollar especially with the Treasury Secretary threatening Korea and China. China is our biggest creditor, and many countries are questioning the dollar arrangement.”
The dollar has been weak this year which is a significant factor in why gold is rising. There isn’t a lot of conviction at the moment. People were thinking things are going to get better, but they are wrong. We will need $1400 to get things into a new gear.
Mr. Schiff thinks the inflation rates will begin to climb upwards of 3 or 4 percent. When inflation was at two percent, they were concerned. They have created a problem, and eventually, they will have to raise rates.
Gold stocks are moving just not as rapidly as one would expect. They are performing considerably better than the general market. When gold breaks out they will need to recover lost ground so there will be spectacular moves.
Peter feels cryptocurrencies aren’t any better than government-backed currencies. He feels Bitcoin itself has no real value. It’s only based on faith as opposed to commodity-based currency systems.
Bitcoin doesn’t have the characteristics of a commodity. It simply has the “faith” that others will accept it in the future just like the dollar. The dollar, unlike Bitcoin, has been around for a long time and everything is denominated and understood in dollars. He feels people should be buying gold as a safe hedge.