Individuals who become well-known for their political career are rarely associated with strong opinions on gold and precious metals. Ron Paul, the retired politician, has always had some very interesting opinions on the financial sector, to say the very least.
Ron Paul in a Nutshell
It is impossible to boil down a political career down to just a few paragraphs. Ron Paul is best known for his tenure as the US Representative for Texas, as well as actively trying to become President of the United States. He tried to achieve that latter goal three times, once as a Libertarian Party nominee and twice as a candidate in the Republican primaries.
For most politicians, being in the running for Presidency three times would be the highlight of their career. In the case of Ron Paul, however, the highlight was serving concurrently with his son Rand Paul in 2010. Ron Paul eventually retired from Congress in 2013.
Ron Paul has not always been a politician, however. He also serves as a flight surgeon in the US Air Force and performed duties as an obstetrician-gynecologist. Now that his political career has come to an end, he is an active speaker on college campuses, during which he shares his libertarian vision.
Ron Paul the Critic
When looking beyond the political feats, it also becomes apparent that Ron Paul has strong opinions on the financial system and what will need to change. In his opinion, the main purpose of the Federal Reserve is “immoral and unworkable“. A very strong negative sentiment regarding the US’ central bank, albeit the Fed has been criticized many times over the past two decades.
At one point, Paul even made a strong case for gold. Replacing the dollar with gold or cryptocurrencies is an option worth exploring, in his opinion. Paul is still dismayed over the collapse of the Bretton Woods Agreement in 1971, even though it helped the gold price to skyrocket from $35 to $800 per ounce. Despite that positive bullion spike, it quickly became apparent that the collapse of this agreement would have major repercussions for the financial industry for some time to come.
Over the past few years, several people have voiced support for reinstating the gold standard. Ron Paul would not be opposed to this idea either, as he still thinks it is the best asset to use for building a viable monetary system.
Noteworthy Ron Paul Quotes
As is always the case with former politicians and strong-willed individuals, there are some very peculiar quotes attributed to Ron Paul. Some of these may strike a chord with a lot of people, especially now that the global distrust toward the existing financial system continues to grow.
One of the quotes by Ron Paul goes as follows:
“A system of capitalism presumes sound money, not fiat money manipulated by a central bank. Capitalism cherishes voluntary contracts and interest rates that are determined by savings, not credit creation by a central bank.”
Central banks have effectively made an impact on the financial system, although not always for the better. The same goes for the government, which is also mentioned in this intriguing Ron Paul quote:
“When the federal government spends more each year than it collects in tax revenues, it has three choices: It can raise taxes, print money, or borrow money. While these actions may benefit politicians, all three options are bad for average Americans.”
Most people do not know that Ron Paul also has an interesting thought on Bitcoin, and how it may affect the greenback moving forward:
“When the dollar is in trouble, that will be one of the alternatives, and the more Bitcoins are used, the worse it will be for the dollar.”
All of these quotes show that the future financial model may look very different from what people are used to today. Which role both gold and Bitcoin will play in the bigger picture, has yet to be determined.
Of all the gold bugs still alive on the planet today, Peter Schiff has to be the most prominent figure. He has very strong opinions on gold, as well as other financial markets and assets. Not all of those thoughts and comments go over well with the broader audience, however.
Peter Schiff the Businessman
Everyone involved in financial markets today has some background in the industry. In the case of Peter Schiff, that is no different. He has built up a solid reputation across various segments of the financial sector, including stock brokerage.
Following that stint, Schiff – together with a partner – acquired a brokerage firm and rebranded it to Euro Pacific Capital. The business was moved across the US several times, and now has offices across different locations. Its main point of focus is securities and non-US markets.
Peter Schiff is also a founder of the Euro Pacific Bank, a full reserve banking outfit in St. Vincent and the Grenadines. It was later relocated to San Juan, Puerto Rico, where it remains operational today.
Speaking of founding units, Schiff is also operating a precious metals dealer outfit in Manhattan. Initially known as Euro Pacific Precious Metals, LLC, it now goes by the name of SchiffGold. This business is primarily tied to gold and other precious metals, which have become synonymous with Peter Schiff’s name over the years.
Peter Schiff the Gold Bug
It is worth noting that Peter Schiff, while notoriously bullish on gold, also favors silver as an investment option. While its price point is much lower compared to the world’s leading precious metal, it is evident that there is room for upward momentum.
Most people see Peter Schiff as a gold bug, however. It is his core belief that both gold and silver will effectively protect investors against the ongoing inflation affecting the US Dollar. Due to the recent stimulus packages introduced in the US, it seems that such investment options will only become more important as time progresses.
Schiff is also credited with introducing the first 100% physically backed gold and silver accounts integrated with the debit card system used around the world. Many other service providers have tried to explore this option since, as it turned out to be a relatively popular business model.
Peter Schiff the Bitcoin Non-Believer
Despite paying very close attention to investment options such as gold and silver, Peter Schiff isn’t optimistic about Bitcoin and other cryptocurrencies. In fact, he considers Bitcoin to be akin to the tulip mania bubble, rather than an alternative to gold and other precious metals.
At its core, this opinion is neither right nor wrong. Gold and silver have built up a solid reputation over decades of time. Bitcoin only exists for 11 years, thus it shouldn’t be thrown in the same mix as gold or silver right now. Once it builds up a similar reputation, the overall outlook on this asset may change.
Peter Schiff Quotes to Take Note of
With such a vast expertise in the financial industry, it is normal that Peter Schiff has some very interesting opinions regarding matters. He has issued a lot of noteworthy quotes over the years, including this one:
“At some point, the dollar has to give. You can’t just keep printing money, and monetizing debt, and buying bonds, without the dollar imploding.”
While the printing of dollars is still ongoing today, it is evident that this particular vision may come true a lot sooner than originally expected.
Another quote by Peter Schiff pertaining to personal wealth is the following:
“People should have an escape valve for their money, their assets. If you have substantial financial assets, the government is going to confiscate the purchasing power of those assets and spend it.”
That escape valve may very well come in the form of gold and other precious metals. Assuming that is the case, the value of gold may change significantly. Assuming that is the case, the following Peter Schiff quote may come into play as well:
“One day we’re going to look back at $1,700 with nostalgia. People are going to be shocked at how inexpensive gold was when it could be snapped up for such a bargain price.”
There is still a lot of momentum left in the tank for gold and silver, that much is certain.
As the weekend dawns upon the stock markets, investors may want to explore alternatives in the coming days. Assets that are less prone to falling off a cliff yet remain easily accessible are always a smart option to explore.
Stock Markets Have a Rough Week
This past week has shown investors all over the world how fragile traditional markets can be. Most stocks have suffered major losses, despite bouncing back briefly on numerous occasions. With the weekend now drawing near, all of these markets will be halted.
This has always been an oddity when it comes to stock markets. They can only be traded during very specific hours, and not on the weekend either.For companies that are publicly traded – and often work over the weekend – having 24/7 exposure across the markets would be ideal. With traditional stocks, that will likely never happen , however.
Many speculators wonder what next week will bring for these markets. In the US, platforms hit circuit breakers multiple times due to steep losses. When investors are in a panic, they should always be able to buy and sell stocks. That is, unfortunately, not how the system works in the real world.
Making matters more peculiar is the decision by the Federal Reserve. Earlier this week, the bank confirmed how it will inject $1.5 trillion into stocks to keep things afloat. Creating money out of thin air and then influencing publicly traded assets with it, is very peculiar. For reasons unknown, this is all perfectly legal too.
Alternative Assets may Offer More Excitement
Similar to stocks, both gold and silver have lost some value as well. This is to be expected, as the novel coronavirus is wreaking havoc globally. These massive sell-offs are not over by any means. Especially where stocks are concerned,more bearish pressure seems very plausible when the markets open again on Monday.
For alternative assets, the weekend will be something else entirely. Precious metals and cryptocurrencies tend to move in unexpected directions. For precious metals, the losses have been relatively low, as investors are not spooked in the slightest.
Contrary to what many expected, the gold price held its own rather well. Despite dropping from $1,680 to $1,519, there is very little sense of panic. Even though the price broke through the 61.8% Fib, it remains to be seen if this is a temporary setback. For now, the overall support seems to be holding quite well.
For silver, the drop-off is becoming quite steep. Compared to its $6 price a few years ago, there is no reason to panic by any means. For those with a short-term perspective, dropping below the 11.4% Fib was not part of the bigger plan. It seems unlikely that this negative momentum will push the price even lower, but no one can really predict these markets by any means.
One market to keep an eye on is Bitcoin. It has shown signs of bouncing back despite the ongoing market sell-off. None of the momentum seems to stock, however, creating a very interesting outlook for the weekend. If a bounce is to occur, next week will undoubtedly get very interesting for all crypto assets.
When a global panic ensues, there are certain precautions everyone must take. Taking care of one’s wealth and ensuring it remains protected are crucial aspects that can never be overlooked.
The Threat Isn’t Over
As the number of coronavirus patients increases, it becomes apparent that this may only be the beginning. Although some sources claim everything is blown out of proportion and no one should panic, it is never a bad idea to take some precautions.
Not just in terms of hygiene and sanitization, but also regarding one’s wealth. As the stock markets crumble, the time to diversify one’s assets is nigh. Even the US Treasury bonds are dropping to astronomically low levels in terms of yield. That is a clear warning sign of how this global pandemic is making its mark on the financial sector.
No one knows how the markets, bonds, and other investment vehicles will behave. Putting all of one’s eggs in the same basket during a time like this is virtually the same as throwing money out the window. Chasing profits is less important than limiting one’s risk exposure.
Wealth Diversification is key
Exploring the many different markets and trading vehicles is always a good idea. Getting complacent is a core reason why so many people lose money when investing. There are very few assets capable of generating a passive increase in value over time. Even those assets will see ample volatility during uncertain market conditions.
A few weeks ago, buying Tesla stock seemed like a good idea. Following the coronavirus outbreak, the stock price has plummeted by roughly 20%. This is primarily due to Tesla building cars in China, as well as a lower demand for these vehicles during the past month. Investors and speculators are very risk-averse right now, which can easily lead to major devaluations of stocks and other assets.
A Long-term Outlook is Crucial
Traders who don’t have the stomach for market volatility should not be overly concerned. Diversifying one’s wealth into assets with a positive long-term outlook are always good choices. Such assets often include precious metals, cryptocurrencies, and certain stocks. McDonalds stock, for example, has only appreciated in value since the big dip in 2003.
Precious metals, such as gold, tend to retain most of their value over longer periods. Last year saw a big gold spike after years of seemingly sideways market momentum. Those who held out hope for a big price increase were rewarded eventually. At the same time, these traders never exposed their portfolio to major losses either.
Perhaps the best investment for the long term are cryptocurrencies. Bitcoin has yielded very solid gains over the past 11 years. Although a new all-time high may not be reached this year, there is still a lot of positive market sentiment. When looking at a 10-year investment plan, Bitcoin has tremendous potential to retain value and even improve one’s wealth.