CEO at Euro Pacific Capital Peter Schiff gives his own analysis on gold, as well as opinion on what step the Fed will take. He does not share the view that the U.S. economy is recovering. Rather, he claims there is a recession ahead for the U.S.
While rate hike and QE are two absolutely different scenarios with most analysts predicting the rate liftoff as soon as September, Schiff doubts the Fed will do that, as a hike will bring much damage to the economy. The analyst reminds of the harm the rate at 1% brought under Alan Greenspan. The harm caused by the Fed during seven years has been higher than that the financial crisis 2008 caused, Schiff says.
While his prediction about higher gold was not fulfilled in the short term (the metal dropped as much as 5% Monday), the analyst suggest the gold has been in a bull market since 1990s and will continue to stay here. Thus, he advises his clients to buy the metal, as it is a great purchasing opportunity, and he notes metal dealers say their sales of gold increase, thus people are into physical gold.
