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Why We Need Gold

BY PETER GROSSKOPF | WEDNESDAY, MAY 15, 2019 

Time to Add Portfolio Protection?A reasonable question to ask is what happens if investors cool to Treasuries, or lose confidence in the purchasing power of their cash, or start to price in the multiple risks that appear to be lurking on the edges of "consensus" expectations? The crowded trade is to do nothing but that is yet another harbinger that the right thing to do is to begin to add some portfolio protection. As we see them, the existing liquid alternatives for insurance would, with U.S. Treasuries losing much of their appeal, be limited to (a) moving to cash; (b) purchasing portfolio protection options or moving to market-neutral funds; or, (c) buying gold or gold equities. 

Global Currencies Are A Sinking Ship, But Gold Will Save You - Sprott CEO

In a market note published Wednesday, Grosskopf laid out his opinion on why investors need gold as part of a balanced portfolio. Although investors have shunned the yellow metal, choosing instead to ride a 10-year historic bull market in equities, Grosskopf warned that the current market environment is not sustainable. 

Grosskopf described the current financial market environment as “a tightly coiled spring which is becoming more loaded every year.” The only way to protect yourself from the approaching crash, he said, is to put your money in gold. 

Grosskopf thinks that fiat could ultimately make way for gold’s return as a payment method. While it may not happen tomorrow, Grosskopf thinks investors don’t have time to waste when it comes to moving into gold, as MMT’s growing popularity means that we could soon see quantitative easing on an unprecedented scale.

Peter Schiff: The Russians Are Buying Gold To Prepare For The Impending Dollar Crisis

Peter said this wasn't a problem when people perceived value in the dollar, but he thinks that's going to change. 

"I think the next recession when the Fed goes back to zero and when we launch QE4, I think the dollar's role as a reserve currency is going to be questioned, and central banks need an alternative. And the only viable alternative to back up their own currency is real money, which is gold." 

The RT anchor asked if it was really possible for other countries to actually ditch the US dollar. Peter said it's not only possible, it's inevitable. 

"Ultimately, the US won't have any leverage at all… This [the dollar as the reserve currency] was an exorbitant privilege that the US has enjoyed for decades, but it has abused that privilege dramatically, even more so recently with the sanctions. So, I think that privilege is going to be lost and with it will go the artificially high standard of living that came along with it in the United States." 

 DYI