Peter Schiff: Right On The Crisis, Wrong On Investing?

Schiff

Peter Schiff is a long term investment strategist. You can take a snapshot of any investors portfolio and find short term losses. I am an investor in Euro Pacific Capital and am very happy with it's performance. I did not get in at the highs as many people did, or the lows. But my account is up about 15%, and paying great dividends. The forces that took many of his stock prices down were artificial and people are realizing this quickly. Everything that Peter predicted is slowly coming to mainstream attention. The dollar and inflation, bond market, interest rates, foreign currencies, de-coupling, China, etc. etc. Just as he was right about the stock market, real estate, bail outs, bankruptcies, corruption, etc. etc. Just watch and see. Economics is a science and this man has true fundamental knowledge and is very smart. Stick with him long term and you will be a happy investor.

Chad of CA @ May 28, 2009 22:47:46 PM

Peter Schiff Is right about the dollar collapse

Let's be honest. Schiff never said that the dollar would go to ZERO. However, it will lose much of its value soon. The government can only raise money three ways: 1. Tax it out of the people 2. Borrow it by selling Treasuries with the promise of paying interest on them or 3. print it. Our glorious members of Congress (which, by the way, is the only govt body that can spend money or raise taxes...the president can only either sign the bill into law or veto it)...anyway, since September of last year Congress has now spent 4.4 Trillion dollars and obligated us for another 7 trillion in future years. This year, in order to get the money to spend, the govt must sell 1.75 Trillion in treasuries by the end of the fiscal year which ends on 30 September. This is almost as much money as the surplus that the Chinese have in their bank. The question is: who is going to buy all these treasuries? It is clear that the Chinese and the Japanese aren't going to buy much more. They, along with South Korea and 10 other asian nations just agreed last week to establish a regional reserve of $120 Billion. In addition, China has made currency swaps with other nations. It is clear that they are setting up a regional reserve currency. (By the way, Mr. Shinkle, this is straight up decoupling from the dollar...so Schiff was right again.) The reserve agreement hammered out last week also includes the selling of asian bonds. So, back to the question: Who will buy US treasuries? Europe? Africa? South America? Australia? Certainly not China and Japan...they have so much on their plate with setting up their regional reserve currency. Perhaps Martians or some other Extra-terrestials will buy them?

The answer is: our own central bank (aka the Fed). They will print the money and buy the IOUs (treasuries) from the US Treasury Department. In short, our government is going to have to print trillions. If the dollar does not collapse, it will will be the first time in the history of economics that multiplying the money supply by four, five or six times doesn't result in inflation.

(Can you say Argentina, boys and girls? How about Weimar Republic? Zimbabwe? Iceland?)

Now, I will admit that knowing about sound monetary policy is a bit different from picking and choosing winners and losers in the stock market. However, it is clear that anyone with dollar denominated assets will see their wealth diminish as the dollar loses its value. That is, no doubt, why the Chinese are so concerned about the hundreds of billion in US treasuries that they currently hold. They don't want to see themselves lose their investment because we print so much money. The Chinese know something that it seems you, Mr. Shinkle don't know. And they are worried about it. You probably don't have billions invested in US treasuries so you don't have to worry about it. They do.

My bet is on Peter Schiff, Gerald Celente, Jim Rogers and Glenn Beck. They know something about money.

Ronald P. Reitz

Ronald P. Reitz of FL @ May 09, 2009 21:44:35 PM

Schiff does not know how to invest -

Peter Schiff has been wrong on all six equity picks he put us in. As Schiff client of XX says, how do you get dividends from a stock which has lost 99% of it's value. When asked who picks the stocks, our "advisor" says Peter picks all of them. Recently we were told they hired three extremely savvy analyst - so far, they've produced noting - just like him. Don't invest with him.

Bob of WA @ Mar 24, 2009 20:38:07 PM

People are short minded!

This is another frustrating example of the "I want it now!" mentality that has led America in the crisis we are dealing with today. Many people, mostly "gamblers" expect to position themselves in order to cash in as fast as possible without an actual analysis of the timing of markets and worlds economies in general. This bubble that is bursting did not start in 2007 or 2008, or even during the Tech bubble. It is the continuation of years and decades government interventionism in the markets, starting evidently with the creation of the FED in 1913. The understanding of the historicity of this current crisis can only allow an intelligent person to conclude that the world is not going to "crash" in 24 hrs! Markets take time to function and if you want to check inflation, just go in your local grocery store!

Added to the fact that most if not all countries around the world have embraced the keynesian principles of increasing the money supply during crisis; it makes it even more difficult to tell which country will go down first!

But the fact are quite simple in my opinion: The usa has nothing to show but its enormous debt and deficits of all sorts. There manufacturial foundation has been destroyed, the government is too big and the army swallow to much money with its bases around the world.

It is not a good picture whether you are an investor or someone who is just trying to figure out his short term future. Are we going to "create" a world war in order to save our head out of the impending depression?

But, when you are rational, you must agree with Peter schiff and the Austrian school of economics.

Obviously, if you invest in the US, you are taking an enormous risk for the fundamentals are inexistant for a long term gain. Maybe looking elsewhere isn't such a bad idea after all.

Imhotep of MD @ Mar 21, 2009 15:31:11 PM

Tortoise and the Hare

To whoever wrote the "Tortise and the Hare" post, please explain how being "slow and steady" waiting for Babcock and Brown or other terrible stock picks to recover will help me? Schiff talks about how the US dollar will lose 75% of its value. Please help me understand how that is better than some of the stocks he has picked losing 99% of their value?!!! Even if they go up 100% due to currency appreciation I am still down 98%!!! BTW "Tortoise" is the correct spelling, not "Tortise" as you wrote.

Schiff client @ Mar 12, 2009 18:24:53 PM

Schiff in real life

If you invested in Schiff's companies you may be broke. Look up Babcock Power, Sterling Mining, Oz Minerals, Minara Resources. These are Schiff stocks, so how much dividend does a bankrupt company pay folks? How does a bankrupt stock coming roaring back when the big dollar collapse that Schiff speaks of comes? Get real, if you believe in Schiff invest with him. He is a sorry investor

Brian of OR @ Mar 02, 2009 23:56:27 PM

Peter Schiff Tells the Saudis How to Crash the US Dollar to LOUD APPLAUSE! WOW!

http://www.youtube.com/watch?v=aTF-oPvhHVs

John of CA @ Feb 18, 2009 11:02:43 AM

shedlocked in quADRANT 5

mike shedlock is no einstein himself. he himself has no direction to write home about. mr shiff does not look down a narrow path that ends just ahead. he positions his clients for the future not the dead end where shedlock's brain is we now know as quadrant 5. what the heck is qaudrant 5 ? so i ask the question where you would rather be? postioned with the usd or against it? that you need not be an einstein to figure out. jsut open up your wallet.

goldbug of PA @ Feb 17, 2009 17:22:43 PM