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Schiff on Gold’s Holding Pattern in 2013

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    Euro Pacific Capital’s Peter Schiff on the stagnation in the precious metals market.

  • Duration 5:31
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Talk about gold a lot -- -- why isn't it much higher in price if Ben Bernanke keeps on printing money joining us now is Peter Schiff from Euro.

Data you've often said you sit on this program look gold is going to go off.

Now I understand that you -- sticking with that prediction gold is gonna go off in the long -- But why hasn't it gone not very much in the last year a year and a half when Ben and everybody else is -- -- like crazy.

-- -- -- a member we had a huge move in the last ten years old started -- bull market from under 300 dollars an ounce though.

It had a big move from 300 hours of close -- 19100 so.

It has been consolidating for the last couple years I think it's preparing for another big move up.

But I think a lot of people just don't understand.

The it did this situation people think that the problems have been solved.

They think that the global economy is out of the woods.

That the worst is over for the US stock markets are rising now the Euro is rising people are complacent now about the problems over there and they think there's no reason to own gold.

And I think they're making the mistake.

The only reason that it looks like the problems are getting better is because the governments around the world they're creating so much inflation to cover them -- -- its inflation that is driving the stock market higher you -- gas prices inflation is driving gas prices up pretty some people are gonna realize that inflation is a lot worse.

I've been the government's -- on -- and I think people are gonna start to embrace all the yen and a big way.

A loss second -- we've got Japan.

Saying today we must have inflation we want some inflation because they've had a period of deflation so that printing yen.

Like crazy.

And the new prime minister says hey you the central Bank of Japan if you don't print a lot of money will change the rules on the Bank of Japan will make Q print mall.

They have that they don't have inflation -- Buster do I mean this is deflation is a ruse that aren't collapsing in Japan they never work probably is that they -- -- -- -- to die but Alan Miller -- -- Japanese consumer appellate.

That I mean -- choices for all of us second thing.

That there is no inflation in Japan the price level today is virtually unchanged from what it was 35 years ago it's not yet.

But inflation is an expansion in a money supply and -- supply credit and you do have that but you had some dynamics that -- keeping consumer prices in check.

Despite all that inflation but you know that's gonna change in Japan the Japanese are gonna start to see big increases in consumer prices and they're not gonna like it.

All the take a look at the UK I -- they're -- inflation is really picking up the UK if they don't care they're gonna keep reading it pretty money in fact inflation.

Is the new monetary policy central banks are creating inflation you know governments don't happen to meet all of our -- that they can you play the way and the prop about the price.

Markets anticipate.

And I think you're right everybody is printing and that everybody's printing money you right on that there's no question about it.

But markets anticipate.

So why isn't gold market anticipating the inflation why don't I mean -- Bob -- I don't think that markets have done a very good job of anticipating anything -- -- you remember -- during the housing bubble real estate prices kept rising mortgages were rising in value the housing bubble the collapse was right around the corner the markets didn't participate any of that I think often markets are blind sided.

-- because so many people don't really understand the dynamics and they're doing the wrong thing but eventually reality is gonna catch up outlook with with with the markets and the and the markets are gonna react in a big way.

OK I believe on this program you said and it's was a few years ago I think you said that soon roll light.

-- house is gonna be worth less than an ounce of gold old a measurement of gold.

He's sticking to that not not a house I said I I said that the stock market I I've been predicting that the Dow and the stock market would be about one to one.

I started making that prediction when it was over 41.

Now it's around what eight or nine to one and I begin got into the sixes at one point.

But I also -- about houses that housing prices are gonna continue to fall as measured by gold.

-- especially if they -- a lot of inflation to keep propping up nominal home prices which exactly which is exactly what the Fed is doing.

But real home prices are gonna fall that much more -- you talked about gas prices before -- came hot and it's not just gas.

It's food prices that are really going up if the price of everything that's going up -- says that the government doesn't -- knowledge the pain that consumers feel.

Because they've got these phony numbers -- CPI that were deliberately designed a high inflation.

And because we -- so many of our dollars we have a huge trade deficit and now these foreign central banks are buying treasuries until you see the inflation in the bond market about a -- but eventually that bottom bubble is gonna burst and all that money is gonna -- real -- -- gotta have a timeframe.

I mean it's very easy decided that at some point to the distant future the price of gold will go to 3000 dollars an ounce or one up.

Giving it time for how Long Will I don't think -- -- distant future.

But okay okay I'll go I'm sort I'm -- -- if you don't doubt whether I would be shocked easy you know we went for another two or three years.

And we -- -- explosive move up in a price and all I think it's gonna hit the fan during Obama's second term so maybe 2013.

2014.

We're gonna have a currency crisis we're gonna have a sovereign debt crisis.

And gold is gonna do very well in that environment unfortunately the US economy is gonna suffer.

-- -- Peter -- we always enjoy having on the show and we appreciate you being with us come again soon -- -- --

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