Early in the interview, Peter laments the possibility that the United States will decline economically. China is poised to surpass our economy as the dollar continues to weaken:

“I think the media is constantly writing China’s obituary. And I think they’ve got it wrong. Just like they downplay the significance of the problems in the US economy, they overplay the significance of the problems of the Chinese economy. I’m not saying it’s perfect over there in China. But I think they have a lot going for them that people are overlooking.”

Michael and Peter discuss the role of U.S. foreign policy– specifically having a military presence around the world– in driving up deficits and the debt:

“We’re all over the world. We’ve got our troops all over the world, but we can’t afford to deploy them. We can’t afford to provision them without borrowing money, and that is not sustainable. I mean, it’s going to crumble. I don’t think the world is going to pay an ever-increasing tribute to the United States to maintain this situation. I think it’s going to come to an end. Yes, it’s gone on for a long time, and our military has probably been part of what’s enabled it.” 

With tension in the Middle East ratcheting up this week, Peter delivers a masterful explanation of why wars are terrible for the economy. The temptation to inflate combined with the physical destruction of productive goods mean wars inevitably impoverish all involved:

“You’re more likely to debase your currency with a war, and it’s actually twofold, depending on how big the war is. Wars can result in the destruction of goods, and there’s a destruction of productive capacity. So, you have less supply of goods in a war. A lot of times, if it’s a big war, you have to produce ammunition and military hardware at the expense of civilian consumer goods. So, wars tend to reduce the supply of consumer goods but increase the quantity of money. Governments today don’t want to pay for wars. They don’t want to tell the taxpayer, ‘We’re fighting a war, so we’re raising your taxes.’ … And they go out and borrow, creating bigger deficits. So, the Fed has to print more money.”

The trio also discusses Peter’s opinions on investments other than precious metals, including stocks and crypto. He argues that Bitcoin highlights the difference between large institutional investors and retail investors trying to cash in on a trend:

“Bitcoin peaked out in November 2021, and priced in gold, it’s almost 40% below that peak. Despite all that money spent, all that hype, all those ETFs in the market, all that institutional buying. So that tells you something. It tells you there’s a lot of people that have been selling their Bitcoin into all the hype. And I think the people selling Bitcoin are a lot smarter and know a lot more than the people who have been buying it.”

Peter is optimistic for the future of gold. With no end in sight for the Fed’s money printing, there’s a distinct possibility that gold’s price could increase by many multiples over the next couple of decades:

“I think the potential is much higher because we’re going to print so much money. We’re going to have so much inflation that the dollar is going to lose a lot of value, and you’re really going to need a lot of dollars to buy gold. If gold can go from $20 an ounce to $2,600 an ounce, it can go from $2,600 to $26,000, or even to $100,000. There’s no limit because, again, gold isn’t changing—it’s the value of the dollar that’s decreasing.”

Halfway through the interview, Peter also drops some trivia about his wife, Lauren. Did you know she both sang and acted in a 2022 Bruce Willis film? Check out the full recording (starting at 38:30) for the details!

Peter compares gold in 2024 to gold in 1979 but notes one key difference. In 1980, the Fed raised rates, putting a stop to gold’s rise. Rate hikes are highly unlikely after the Fed’s recent announcement:

“Gold is up almost 30% so far this year. Another all-time record high today, getting close to 2700 in the spot market. This is the best year that gold has had since 1979…

…A key difference between now and 1979? That was the end of the gold bull market. And in 1980, Paul Volcker raised interest rates up to 20%.

That’s what killed the bull and brought inflation down. But the current Fed is cutting rates. It’s going to cut rates more in 2025. So, gold is just getting started.”

A 50 basis point rate cut signals that either the Fed is scared of America’s economic future, or they believe we’re already in a recession:

“Well, the Fed is very desperate. I mean, normally they wait until there’s a problem before cutting rates.

They wait for a major stock market decline. They wait for a recession. But here, they’re cutting rates even before we’re officially in a recession and with the stock market at all-time record highs, with real estate prices at all-time record highs, and with the gold price at all-time record highs.

We’ve never had the Fed start cutting rates when gold was at an all-time record high. And in fact, the record high in gold proves that the Fed’s rate cut was a mistake.”

A lot of the data that supposedly portrays a healthy economy is corrupted by the pervasiveness of private and public debt. GDP growth is one example:

“The GDP is consumers spending borrowed money to buy more expensive groceries and stuff like that. The government spending borrowed money is a big part of that GDP. And we have a massive deficit that is a consequence of this fake GDP growth…

…We do not have a good economy. We don’t have a growing economy. We have inflation. And inflation creates the illusion of economic growth. But people are getting poorer, even though the numbers are going up again.”

For more Schiff insight and insight from the Austrian school of economics, watch a recent interview between Peter and Jason Burack, host of “Wall Street for Main Street.”