Swiss vote the low point for gold?
Peter Schiff responds to the failure of the Swiss gold referendum this past weekend. To Schiff, the arguments against backing the Swiss franc with gold ignored both the history of Swiss economic success and the grim results of tying the franc to the failing euro. But Schiff argues that this vote is bullish for gold. With the franc no longer a safe haven, gold has no more inflation-hedge competition. See video below.
Stay tuned for a full transcript. Meanwhile, follow along with these timestamps:
0:17 – “Save Our Swiss Franc” would have been a more accurate description of the Swiss gold initiative.
0:59 – Switzerland used to have more than 40% of its reserves in gold and was very prosperous.
1:47 – The Swiss gold initiative was a threat to the powers-that-be, because it limited the ability of the Swiss National Bank (SNB) to create inflation
2:35 – If the initiative had passed, Switzerland would have been an example of a strong economy in a sea of European inflation.
3:34 – How is it crazy to have only 20% of your assets in gold, but sensible to have 100% of your assets in fiat currencies?
4:30 – The Swiss originally didn’t want to adopt the euro, but now they’ve embraced a de facto euro standard.
5:30 – Gold and silver dropped dramatically after the vote, which was surprising since no one had really expected the initiative to pass.
6:23 – Gold and silver recovered their losses quickly once the United States started trading.
7:10 – Peter believes the “no” vote is more bullish for the long-term price of gold.
7:43 – If the Swiss had adopted the referendum, it would have slowed down Swiss money printing and Swiss inflation.
8:28 – When the world realizes the United States is going to return to quantitative easing, the Swiss franc will no longer be a safe-haven option. This would mean greater demand for gold.
9:36 – If the SNB won’t be buying gold on behalf of its people, the Swiss will buy gold individually to protect their purchasing power.
10:49 – Looking at historical actions of central banks, there’s a chance that gold’s low price on Sunday could end up being gold’s bottom.
11:55 – SchiffGold has a limited-time special on 1-ounce silver bars for 79¢ over spot.
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