Schiff on CapitalCosm: Silver Shortages Ahead

Peter recently Joined Danny on the CapitalCosm podcast to connect the dots between rising precious metal demand, a weakening U.S. dollar, and the narratives that have tried to replace gold — like Bitcoin. He warns listeners to treat physical metals differently than paper assets, explains why gold is reasserting its monetary role, and cautions that silver coin and bar shortages could make timing a market pullback a trap.

First, Peter warns that buying the metal is not the same as buying a ticker symbol; physical availability matters and premiums can swamp price moves:

But the other problem for silver, and it’s why I was telling people this when it was 70 and 80 and not say, look, it could pull back. But you have to worry about the availability of the product because we’re going to run out of coins and bars, especially these small denominations that people want. So even if you buy silver at 115 and it goes back down to 100, the products could actually be more expensive because of a higher premium, and they may not even be available.  

He frames that scarcity in the wider context of money and global reserves, arguing that we are watching a fundamental shift in what nations hold as money:

Well, what’s going on is exactly what I’ve been forecasting would eventually go on. The only surprise to me is that it’s taken so long for the process to really begin. But what we are witnessing is really the re-monetization of gold as a replacement for the U.S. dollar. The U.S. dollar’s role as the primary reserve assets for foreign central banks is coming to an end. And I think with it, the entire way of life that we have built here in America, which is predicated on the dollar having that status.

That leads into his bold price outlook: gold’s long-term target is much higher than commonly assumed, because monetary expansion has continued to accelerate:

Gold is going a lot higher than five thousand dollars. I used to have a five thousand dollar forecast over a decade ago, but a lot of money has been printed since then. You know, because we kicked the can down the road on a dollar crisis a lot longer than I expected, my ultimate target for gold is now a lot higher than I initially expected. So this is not the end of this thing. We’re going a lot higher and we’re just really starting to see the dollar break down.

Peter clarifies that a rising gold price will not be a simple one-on-one story versus every other fiat currency; the dollar is likely to fall against most peers while private demand for gold rises from both central banks and private buyers:

And you’re also going to see the US dollar a lot lower relative to its fiat counterparts. So it’s going to be in the context of a major US dollar bear market where you’re going to see that kind of appreciation in the price of gold. And it’s not going to be just central banks that are buying, but they’re going to be buying. They’re going to be buying more. But there’s going to be a lot of private demand for gold, not just the industrial use case.

Finally, he takes on the Bitcoin promoters that tried to supplant precious metals during the years metals consolidated, and he explains why that narrative misled many investors:

Because for years and years, Bitcoin really stole gold’s thunder, silver’s thunder during the years of sideways action in precious metals, which really was a consolidation phase. The Bitcoin promoters were able to advance a narrative that since, you know, Bitcoin, since gold and silver weren’t going anywhere, that they had been made obsolete by Bitcoin. That Bitcoin was the new gold, gold 2.0.  

For a deeper dive into the silver market, check out SchiffGold’s latest COMEX analysis.