Peter Schiff, President of Euro Pacific Capital, discusses silver’s 22% gain over the past quarter and advises on what the Fed needs to do to stop devaluing the US dollar. Peter Schiff has made a number of accurate economic prediction over the last half decade from the real estate crash in December 2006 to the bullish rise of precious metals. With spot gold now at ~US$1,419/oz and Silver at ~US$35.28/oz the Gold-Silver ratio now sits at ~40:1. Schiff aptly pointed out that when the dollar was established in the Coinage Act of 1776 the Act essentially pegged the gold-silver relationship at 20:1 because the dollar was defined as ’1/20th an ounce of gold or 1 ounce of silver.” With the ratio up high like it is now Schiff believes it makes sense to favour silver. Schiff did however state “If it got to 25:1 or 30:1 then I would think you could certainly back-off”.
Peter Schiff Silver
“Silver is kind of the best of both worlds because it’s an industrial metal and it’s also a precious metal. So if you think the economy is growing, you can buy silver, and if you’re afraid of inflation, you can buy silver.”
Schiff thinks silver will continue to gain on gold as the precious metal bull market unfolds. He expects the gold/silver ratio to fall below 20.
Schiff is advising investors to buy more gold and wait for an expected pullback in silver. He points out that oil and gas are currently at a record low when priced in real Constitutional money. More about gold and silver investment news.
Simple ways to gain exposure to precious metals are to buy a senior producer focused ETF such as Market Vectors-Gold Miners (GDX), Global X Silver Miners ETF (SIL), or a junior focused ETF such as Market Vectors Junior Gold (&Silver) Miners ETF (GDXJ). However the problem with these ETFs is that they funnel attention to a select few companies whereas there is a large universe of fast growing gold and silver stocks that offer exceptional risk-reward scenarios. One such company that appears poised for upside share price appreciation in 2011 is Abcourt Mines Inc. which has two projects of significance located in stable, mining friendly Quebec, Canada. The current infrastructure value alone on Abcourt’s two quality past producing projects is over $CDN20M; the current market cap of Abcourt is close to its infrastructure valuation alone, ignoring the sizeable economically recoverable resource deposits (1 billion+ dollars in Zinc and silver alone) that are wide open for expansion, and the 215K+ oz gold resources at Elder.
Sorry, the comment form is closed at this time.