Peter Schiff: U.S. Rally Is Doomed, Gold Will Hit $5000

I see no evidence that (1) Gold markets could support such an inflation; (2) That gold supply is going to drop markedly so to support such prices, and (3) that the stock market (more importantly, as anyone should know, oil markets) would have this kind of effect on gold or vice versa (again, oil markets tend to parallel much, much more efficiently and congruently).

That said, I am not convinced we're not in a classic bear rally either, though the increases are at very high levels for a bear rally. Nor am I ready to rule out that we're in a full orbed recovery, though I believe the former is much more likely than the latter. Too many other variables account for much of traders' behavior. Right now, I don't know how well past models can predict what can happen. One thing is constant and that's been the oil-gold link. For gold to hit that high, oil might have to drop to $20 a barrell. Not happening. So the other explanations for gold to hit $5k and oz just don't pan out from where I sit and analyze.

 

I don't think comparing gold to tech stocks is a fair comparison. Apples and oranges. Tech stocks were part of small cap growth and sector growth stock funds. We already have these with gold in them and nothing's happening. With an annualized ROI of around 1.5%, gold cannot appreciate astronomically as this person argues. We see any kind of abnormal and astronomical spike in Gold, I;d be afraid we'd see a Dutch Tulip collapse.

You must love this part, Ken

Conflict of interest? And with China's GDP of $2billion (a fraction of ours) I don't see China being what he portends.

Exactly. China is way too vested in the dollar. We go down, they go down with us.

 

I don't see how they could survive if our economy collapses. Our "overstretched foreign interventionist foreign/military policy" (Did Ron Paul sign on under your name) :laugh: is not going to be the deathknell, but it's a shot no doubt. Our weak fiscal policy, due in no small part to our reliance on flawed Keynesian models that Bush liked and Obama loves and that Greenspan worshipped (shhh...don't tell him he's no longer Fed chair) and Congress salivates over, will be the major nail in the coffin.

 

Sems to me that every time the economy gets wierd enough someone starts a world war. The Crusades were economic/political, not religious. A big enough war is like "passing go."