Schiff on VRIC Media: Hike Rates, Back Gold, Dump Bitcoin | SchiffGold

In a recent VRIC Media interview, Peter lays out a straightforward critique of modern monetary policy and the political choices driving today’s economy. He connects low interest rates, tariffs, and misguided enthusiasm for crypto to a brewing misallocation of resources, and points listeners toward gold and real assets as sensible hedges.

He starts by taking aim at the prevailing idea that current interest rates are “high,” arguing instead that rates remain too low given true inflation and historical norms. He also reminds listeners that official inflation measures have been altered over the decades and that a proper accounting would show prices rising much more than people think:

But the correct monetary policy is actually to hike them. Rates are too low. Yes, I mean, they’re four and a half and people think that’s high compared to the fact that we had zero. But that’s an artificial benchmark to measure anything by. From a historical perspective, if you look before the 2008 financial crisis, we have low interest rates right now, but we have high inflation, especially, you know, if we measured it accurately, if we still have the same CPI they were using in the 70s, you would see that the inflation is actually quite high.

He then turns to trade policy and political priorities, arguing tariffs are a regressive tax on American competitiveness and household budgets. He connects the tariff policy to a broader misdirection of resources, noting how political leaders favor headline-grabbing schemes over rebuilding productive capacity:

The tariffs are a net negative. Yes, the government needs revenue. But raising them this way is going to help make American businesses less competitive than they are now. And of course, it’s going to increase the burden on the poor in the middle class who are already struggling as inflation erodes away the value of their wages and whatever they saved. You know, and I think a lot of other things that Trump is doing, that he’s misdirecting resources towards crypto and those type of businesses to the expense of other businesses that we actually need more than this crypto nonsense.

On the roots of the problem, Peter argues there are no shortcuts: the economy needs a cleansing bust before a sustainable recovery can begin. Attempts to skip the downturn only magnify the next collapse by expanding bubbles rather than creating genuine wealth:

But in order to fix the problems, we actually need a bust, right? We need the bust before we can have the boom. Trump wants to skip the bust and go right to the boom, which you can’t do. All you can have is a bubble. So rather than have a legitimate economic boom, Trump just wants to inflate another bubble so he can pretend that the economy is booming, even though we’re just blowing air into a bubble.

Against that background, he highlights a quieter but meaningful shift: central banks are rotating out of U.S. dollars and Treasuries into gold. Peter frames this as a structural driver of the long-running gold bull market and a reminder that paper promises can be abandoned by issuers while gold endures:

But the other big rotation is the one that central banks are making out of US dollars and out of US treasuries into gold. And that has been the primary driver of the gold bull market. And gold has outperformed the S&P so far in the 21st century. 25 years, you’re better off January 1st, 2021. If you just bought some gold coins from SchiffGold and put them in your sock drawer and just left them there for 25 years, you’ve beaten the S&P 500, even with the dividends of the S&P 500.

Finally, Peter lays out a macroeconomic scenario that supports real assets: as the dollar weakens and emerging markets reorient toward domestic consumption, demand for commodities and energy will rise. That trend, he argues, will lift commodity prices and reward those who own tangible things rather than paper claims:

They’re all going to be bid higher with all this inflation and especially, you know, as the dollar really tanks, if emerging markets are a main beneficiary of a weaker dollar, then they’re going to consume a lot more commodities because, you know, they’re going to start consuming more of their own production instead of exporting stuff to America. They’re going to build stuff and keep it. … They’re producing goods for their own consumers, so, you know, we can see a real boom in commodities.

For Peter’s analysis on last week’s silver surge, check out the latest SchiffGold Gold Wrap Podcast!

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