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Why Peter Schiff Sees Gold At $5,000

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Why Peter Schiff Sees Gold At $5,000
  • Peter Schiff of Euro Pacific Capital appeared on CNBC’s Futures Now on Thursday afternoon.
  • The expert defended his prediction that gold is going to $5,000.
  • So, let’s take a look into his arguments.

Peter Schiff has been bearish on the economy and bullish on gold for quite a while now. Last month, he told Benzinga the economy is "starting to deflate," adding that he expects the Fed to undertake more quantitative easing in 2016.

Speaking to CNBC, Schiff explained how he's positioning himself to capitalize on this view. “I don’t tell people to put all their money in gold," he said, "I tell people to put some of their money in gold; 5 to 10 percent. And, as you get more money, and if the price of gold comes down, now you can add to it at a better price.”

Long-Term Play

It’s a long-term play: Prices sometimes go down before going up, he added, assuring the price would still go to $5,000.

But, how much lower will gold go before it starts to rise again? Schiff said he doesn't see much more downside because that's already baked into the commodity.

“Everybody has been anticipating the Fed was going to raise rates; in fact, they thought the would’ve raised them a lot more than 25 basis points by now. There are still people who think there’s a lot more rate hikes coming.

"I still believe that’s wrong: people are ignoring the inherent weakness in the US economy and the fact that the Fed is going to be back to its old tricks and only has one game plan for recession, and that’s printing money.”

Disclosure: Javier Hasse holds no positions in any of the securities mentioned above.

 

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Posted-In: CNBC CNBC Peter SchiffLong Ideas Commodities Markets Media Trading Ideas Best of Benzinga

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