19 Dec ARE WE ON THE BRINK OF A DOLLAR CRISIS? ONE EXPERT THINKS SO…
“It’s three strikes and you’re out,” says Peter Schiff, the money manager who correctly predicted the 2008 financial crash. He’s talking about the growing bubble in the financial markets that when it bursts, will have such an impact that “the Fed [isn’t] going to be able to inflate another to mask it…”
The Looming Dollar Crisis
“I predicted a lot more than just the stock market going down [in 2008]. I predicted the financial crisis, but more importantly, I predicted what the government would do as a result of the financial crisis and what the consequences of that would be because that’s where we’re headed. The real crash I wrote about in my most recent book is still coming. . . . This is the third gigantic bubble that the Fed has inflated, and when this one pops, it’s not going to be ‘the third time is a charm.’ It’s going to be ‘three strikes and you’re out,” says Schiff.
“I think the problem we are going to be confronted with is going to be much worse than a financial crisis. It is going to be a dollar crisis, and it is going to be a sovereign debt crisis where the bonds people are worried about are not some sub-prime mortgages. . . . It’s going to be the U.S. government that people are worried about and the solvency of the U.S. government and the Treasury bonds. If it’s a dollar crisis and people are worried about the dollar, the only thing worse than owning a dollar today is owning the promise of being paid in dollars in the future. I don’t think we have the courage to default and admit to our creditors that we don’t have the money and we can’t repay. I think we will create all the money that we need so we can pretend to repay, but what we end up doing is wiping out the debt with inflation,” Schiff adds.
If his predictions are as accurate as his previous ones, things certainly look grim for the dollar.
Gold – A Better Option for Safe Investment?
In Schiff’s predictions, gold prices can only be suppressed for so long, meaning it may be a wise option to buy gold sooner rather than later: “How long can they keep the price of gold suppressed? We will know when we get there. At some point, the price is going to explode because there is real physical buying, and all that paper selling can’t camouflage that. . . . People don’t trust fiat currencies . . . . More and more people are looking for alternatives, and the real alternative is gold. When they embrace it, it’s going to overwhelm central banks’ ability to suppress the price. In the meantime, enjoy the gift that they are giving,” explains Schiff.
Schiff believes that physical gold and silver, and not the ETF (that are not backed with real gold), is the true hedge for the upcoming disaster.
What Are Your Options?
At J. Rotbart & Co., we’re here to help you make the right decision when it comes to buying gold and investing in precious metals. If Schiff’s predictions are anything to go by, gold could very well be a purchase worth considering.
If you’d like to learn more about buying gold, contact us today.