Peter Schiff is one of my favorite investors and economists to watch, read, and keep up with. He’s known for being notoriously bearish on pretty much everything right now. He thinks tough times are ahead for the US economy, the US dollar, bonds, the stock market, and almost every other traditional investing venue.
He earned the nickname “Dr. Doom” a few years ago when he was predicting the current depression that we’re entering. He started predicting the recession around 2006, and wrote a book in 2007, explaining what was about to unfold. Well, it’s 2010, and he was right all along. The stock market, mortgage market, bank rates — everything’s down and few are showing any real signs of recovery.
In other words, Peter Schiff is the multi-millionaire guy who predicted the current recession and risked his entire reputation to warn us about it. In the world of economics, that took guts — the man’s a hero.
But here’s the reason I’m writing about Peter Schiff: he’s still making some pretty radical predictions. Peter’s bullish on a commodity we all know and love — gold.
In 2009, Peter was going way out on a limb and was predicting to Fox Business News that gold prices were going to eventually hit $5,000 per ounce. That’s… a lot for gold. That’s about 3 times what it is right now, and as of yesterday gold prices are the highest they’ve ever been in the history of man.
But it gets better. Peter made that prediction way back in 2009. But just a few weeks ago, Peter made some more gold price predictions: he claims spot gold prices are going to hit the $10,000 mark.
The reasoning for this? He typically gives the following reasons for his radical predictions:
- Inflation. The world currencies are going to see the effect of printing trillions of dollars at some point. It’s not possible to print that much money and not see some massive inflation. Since many investors see gold as a hedge against inflation, people are storing their wealth in gold and silver instead of Federal Reserve notes.
- Stock Market. There’s no where else to invest. The stock market is not looking good yet, and still might start experiencing some “aftershock” dips in value. Whenever people lose trust in stocks, they flee to gold.
- Gold is Real. If you own gold, you know what you have — you have gold. If you own stocks, it’s not the same — it’s just pieces of paper that may or may not be worthless. The same goes especially for a lot of other investments, like bonds. If you’re going to buy stocks, gold mining stocks are typically a good route to take, argues Schiff.
Personally, I think Schiff’s gold predictions are a little far-fetched. But he might be right, and I’m not just going to brush him off. In the next week or so, I’ll be writing about Warren Buffett, Jim Rogers, George Soros and some other investors, and will show what they think about the future price of gold, so make sure to subscribe so you won’t miss the updates.