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Peter Schiff continues: 

“In fact, we could have a bigger decline in the Dow in terms of gold, in 2012, than we had in 2011.  We are toward the middle to upper end of the range where stocks will be trading in 2012.  Stocks will finish 2012 somewhere between 10,000 and 13,000.  So the Dow may actually trade lower in 2012, but I don’t think it will be something crazy like a 30% or 40% drop.

I don’t think people will make money in stocks in 2012, especially in terms of gold.  The price of gold should move quite a bit higher next year.  We should decisively take out $2,000.  It’s hard to say how high gold will go, but it should trade above $2,500.  I think gold will have an even better year in 2013.

There will be continued solvency issues in 2012, along with more sovereign credit and banking problems.  There will be more bailouts.  FHA will need a bailout, the post office will need one also.  So, you are going to see more government printing.  There will be more talk of stimulus.  This might be the year where the Fed comes out of the closet with QE3 and finally admits they are doing it.

I also expect all of these foreign central banks that have been buyers of gold to continue to increase their holdings.... 

Continue reading the Peter Schiff interview below...


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“All of the emerging market central banks should increase holdings, not just China.  China doesn’t even have 2% of their reserves in gold, it’s tiny, it’s really ridiculous.  I don’t know if they have a goal, but they need to get a lot more.”

When asked about the economic outlook for 2012, Schiff responded, “Sears was down over 27% today on bad sales numbers.  Sears was trading at $190 in April of 2007 and today it trades at $33.  I think there was a lot of discounting going on this holiday season.  

All of the retailers in America are in trouble because Americans are broke.  They are going out and spending, but they shouldn’t be spending, they should be saving.  This is the stupidest thing we could do, all of these people going to the malls.  All of the retailers, to get their sales, are discounting.  They are not even making profits.

The profits are all going to the people who are making the products, such as China.  The Chinese producers are still getting their full price.  2012 will be the year of reckoning, it’s long overdue.  We’ve got a lot of problems.  We’ve got to pay the piper. 

Is this the year that Americans have to stop shopping?  I here all of these reports, ‘Is this going to revive our economy, all of these people shopping?’  It is actually putting the nails in the coffin.  We’re just spending more borrowed money, we should be saving, producing.

Everybody is worried about everybody else, except America.  As long as the world is worried about Europe and Japan, we can keep spending borrowed money because everybody keeps loaning it to us.  When they start worrying about America, then the party is over.  That’s the question, ‘Is the party going to end in 2012?’  It’s long overdue.

If it does end in 2012 that means austerity.  That means no more shopping and higher prices and interest rates and shrinking government.  It means we have to lay more people off and create real jobs.  This will equate to a big drop in the standard of living for many Americans.”

Peter Schiff’s new book “The Real Crash” is due out in Spring.  You can also go to Peter Schiff’s website and download his special report.

© 2011 by King World News®. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.  However, linking directly to the blog page is permitted and encouraged.

Eric King

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