Peter Schiff: Gold to $5,000

Posted by Peter Schiff - Euro Pacific Metals

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Peter Schiff told CNBC this morning that Gold at $1,200 is not expensive “considering all the money that we’ve created and all the money that we are going to create”. According to Schiff investors should invest in Gold because the yellow metal will at some point, perhaps prior to Obama leaving the White House, hit $5,000 per troy ounce. Here’s Schiff on how high Gold & QE3:

Schiff: I think a minimum of $5,000. But it could go a lot higher than that. A lot of it depends on future actions of central banks. We’re on a trajectory right now to send gold a lot higher, but central banks could do the right thing, and that would limit gold’s gains. But the more they keep printing money and the more they keep interest rates low to artificially prop up the economy, the higher gold is going to go.

Regarding the Fed and  QE3: 

Schiff: No. I think they’re going to do it. The Fed always does the wrong thing, and QE3 would be the wrong thing, so they’re going to do it. If you look at what the Fed says, they say we’re going to do QE3 if the economy needs it, and the economy is going to need it, from their perspective, because without QE, the economy will lapse into a worse recession than the one we just finished. That’s because we still have a lot of problems to correct because the last recession was cut short by the stimulus.

So the stimulus interfered with the market’s attempt to correct all the imbalances that were built up over the phony boom that was a function of prior Fed mistakes. If you understand that the economy is basically floating on a sea of stimulus, then when the stimulus goes away, we’re back in recession. The Fed saying we’re only going to do QE if the economy needs it is like a heroin addict saying he’s only going to take more heroin if he needs it.

 

The interview above came from Vette350’s Junior Mining Blog