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Peter Schiff Warns to Get Out of Dollar Denominated Assets

Blog Aug 4, 2011

In talking about Dollar Denominated Assets, Peter Schiff tells Breakout “Unfortunately, because we raised the debt ceiling, because we continue to spend money, the cost of government is going to be born by those foolish enough to hold U.S. currency.” Peter Schiff is the president of Euro Pacific Capital and is frequently seen on CNBC as well as others.

What Peter means when he says “those foolish enough to hold U.S. currency” is that the government and the Fed are going to print their way out of this mess.  This in turn is a hidden tax through inflation. Therefore, those that hold US dollars lose purchasing power over time.  So what Peter is recommending is to get out of US dollars.

He recommends, gold and silver as well as foreign stocks, non-dollar denominated bonds, commodities and foreign currencies as an appropriate hedge.

Peter does say that if you own US stocks that they will rise in the face of inflation in nominal terms as the government continues to create liquidity. But when priced in terms of real money, gold and silver, the real value of stocks will collapse; which is what has been occurring with stocks compared to gold for the past 10 years.

Peter also says that QE3 is coming, and in fact may already be here.  He says the Fed may have launched it in secret and that we will hear about it later. But the net effect will be inflation as governments around the world will continue to print money.

 

The writing is on the wall at this point, governments around the world are committed to printing money. The only way you can protect yourself is to be aware that this is occurring and take action.  At ITM we believe in a diversified portfolio, just like Peter Schiff does. We do not recommend that you put all of your assets into gold and silver, but a portion of them should be allocated there for sure. If you would like help with creating a strategy and building a portfolio in gold call us and avoid dollar denominated assets.

Thumbnail Photo We believe that everyone deserves a properly developed strategy for financial safety.

Lynette Zang

Chief Market Analyst, ITM Trading

Sources & References In This Article

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