Peter Schiff gives his take on the recent economic news, rumours of a sizable downward revision in job numbers, and what he sees as the irony of a state Bitcoin coin reserve.
The Perma Gold Bull sees a striking resemblance between the government’s spending situation and a Ponzi scheme.
Peter Schiff believes that with the elections ended, we could see a downward revision in job numbers.
“There is no need for government statisticians to manipulate the numbers,” he said in a recent podcast.
In August, the nonfarm payroll growth was already revised down by 818,000, according to the Labor Department.
The greatest downward revision came in professional and business services, where job growth was 358,000 less than initially reported.
“Peter Schiff believes that with the elections ended, we could see a downward revision in job numbers”
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Peter Schiff noted that the Department of Labor announced it was close to another downward revision in the non-farm payroll numbers in December.
“This will affect the numbers from June 2023 up until June 2024. An entire year’s worth of job reports is about to get significantly revised lower. … [The government] now says, ‘Oops, we’re sorry, they weren’t created at all.’ I specifically said it would happen after the election when there was no longer a reason to sugarcoat these numbers,” said Peter Schiff.
Peter Schiff gives his scoop on what the revised job numbers will have on foreign exchange and the precious metals market
“If this is the case, there could be major ramifications in foreign exchange and the gold markets, which responded throughout the year to the relatively optimistic labour statistics,” he said.
“there could be major ramifications in foreign exchange and the gold markets, which responded throughout the year to the relatively optimistic labour statistics”
PETER SCHIFF
So, if a recession is being hidden under sugar-coated job numbers, the market could underestimate the rate and pace of Fed rate cuts going forward. In other words, if the Fed cuts more than the market anticipates because the job numbers aren’t that good, that could dampen the USD bull run, which could also be bullish for precious metals.
“It’s most likely that if you reduce any given month by about 100,000 jobs, you will end up turning a job number that was a beat because it was above estimates into a miss because it was below estimates. So, it means all of the headlines were wrong. The market reaction was incorrect. If the dollar rallied, if gold sold off, if the market rallied based on a beat, it wasn’t a beat. It was a miss,” said Peter Schiff.
Peter Schiff gives his scoop on the creation of a government Bitcoin reserve.
Bitcoin broke through the 100,000 USD threshold, which was primarily triggered by two milestone events-
The stepping down of Gary Gensler, Chairman of the Securities and Exchange Commission SEC, was seen as giving mixed signals about cryptocurrencies. The departure of an SEC chairman, who could not clarify cryptocurrencies, was viewed as a headwind to the development of the technology.
“Nations moving their reserves into Bitcoin, something that was ridiculed a year ago, is what could drive unprecedented buying momentum and the cryptocurrency price far beyond 100,000 USD” – Wealth Training Company
Lack of clarity led some participants to fear becoming unbanked or criminalised.
Minutes after the SEC’s departure, Reuters reported Donald Trump’s “crypto council” is expected to “establish Trump’s promised bitcoin reserve.”
News that the US would adopt a Bitcoin reserve, which would see the treasury purchase 200,000 Bitcoin every year for five years until it bought 1,000,000 Bitcoin pushed the bellwether cryptocurrency to over 100,000 USD.
El Salvador’s Bitcoin reserves are now worth $603.34 million, reflecting a 117.74% increase in value year-to-date. The country’s total profits equate to $333.59 million from an initial investment of $269.74 million, driven by Bitcoin’s recent surge past $100,000.
Nations moving their reserves into Bitcoin, something that was ridiculed a year ago, is what could drive unprecedented buying momentum and the cryptocurrency price far beyond 100,000 USD.
But if more countries move a fraction of their reserves into Bitcoin, then the cryptocurrency would adopt mainstream characteristics of a store of value and safe haven against monetary inflation. In other words, Bitcoin becomes a rival to gold and not fiat currencies.
Peter Schiff gives his scoop on a Bitcoin remains predictably cynical.
He calls attention to what he sees as an ironic situation:
“If they do that, it’s great for the people who own Bitcoin, who can sell their Bitcoin to the unwilling US taxpayer who is being forced to buy Bitcoin at gunpoint. Because that’s the coercive power of the state, which is the ultimate irony, right? Because Bitcoin was supposed to be anti-government. It was a way to circumvent the government and exit fiat currencies. This is a decentralised thing. It’s away from the government. It’s voluntary. It’s the free market. But its salvation now is the government. It’s the government buying Bitcoin that everybody is now counting on to make the price go up,” he said.
“If we can’t borrow more money, we’re not going to pay back any of the money we already owe. Well, that is an admission that you’re running a Ponzi scheme” – Peter Schiff
Capital flows into Bitcoin. Where are the outflows coming from? Peter Schiff gives his take
Microstrategy and Mara Holdings have poured billions into Bitcoin; Peter worries about a foolishly misallocating capital in what he thinks is a Bitcoin bubble.
But if we are at the beginning of a Bitcoin reserve with global foreign reserves at 12.3 trillion USD in 2023, the Bitcoin rally could have room to grow.
With El Salvador’s 117.74% profit on its Bitcoin reserve and the US endorsing El Salvador’s move by moving a fraction of its reserves into Bitcoin, a FOMO rally fuelled by sovereign capital could be on deck.
If Bitcoin is the new digital gold, could capital flows move out of gold into Bitcoin? If there were no Bitcoin, gold would be much higher.
The thought of Bitcoin as a rival to gold must be rattling the perma gold bug, Peter Schiff.
“But if capital is going into these ridiculous money-losing businesses gambling on Bitcoin, where is it coming out of? We don’t have an unlimited supply of investment capital. Right? So, any capital that is directed to Bitcoin, blockchain, or crypto is capital that can’t go someplace else. It can’t go someplace where it’s needed to produce real goods, real things. Instead, it’s being squandered,” he said.
Peter Schiff gives his take on raising the debt ceiling, which is no less controversial.
“If we can’t borrow more money, we’re not going to pay back any of the money we already owe. Well, that is an admission that you’re running a Ponzi scheme,” he said.
