Yeah, I know. I’m 50 years old (as of yesterday), but no longer relevant.
I think it’s awesome that the Bitcoin (notice, I did NOT say crypto) community is exploding– and that with each passing day, its most vocal leaders are Millennials. However, the handful of legacy finance guys like myself that were early Bitcoin adopters and evangelists have a heck of a lot of experience in the financial world that you’d be wise to heed - even if the new financial order is with each passing day, less and less connected to the old.
In my case, I am unquestionably the first well known Precious Metal community member to switch from gold/silver to Bitcoin – starting my transformation in early 2016, and going all in in mid-2017. Max Keiser was well ahead of me, but he’s a special case because he was not part of the gold community – but instead, a brilliant journalist and investor who recognized Bitcoin long before anyone else.
I wrote hundreds of articles and taped dozens of Bitcoin-related podcasts from 2016-20, but that pales in comparison to the thousands of articles and hundreds of Precious Metal-related podcasts I published from 2002-17.
So, when it comes to gold, silver, and mining stocks, I have a deeper pool of knowledge than 99.99% of the entire global investment community. Thus, when I speak of it, as I am now, it would be wise to listen. And why I’m writing today, is to for the millionth – and LAST - time, to BEG Precious Metal investors to switch to Bitcoin, whilst there’s still a chance to eschew the OLD sound money kings for the NEW.
Not that such pleas are new, as I have been shouting this from the rooftops since selling my silver for Bitcoin in summer 2017, and my gold shortly thereafter. However, in seeing yet another Precious Metal failure this summer – care of the Gold Cartel, and increasing realization gold and silver will NOT have material roles in the unfolding Digital Age – I felt the need to yet again state my case…this time, for the LAST TIME EVER.
The fact is, Precious Metals lost their use case the day Bitcoin was born – as frankly, everything I loved about gold and silver before have been rendered archaic and obsolete…to the point of actually being “barbarous relics.” To wit, not only are Bitcoin’s monetary properties VASTLY superior, but the gold and silver markets have been so compromised by governments and bad financial actors (JP Morgan, etc), they no longer function properly.
No one knows exactly how much gold is held by Central banks, as they are NEVER audited and admit to limitlessly rehypothecating it. But rest assured, Central banks and Treasuries own massive amounts, to the point that they are big enough “whales” to move the price at will. To that end, “paper” gold and silver markets are at least 100x the physical markets, to the point of rendering physical market price discovery useless. In other words, PM prices are still heavily influenced by bad actors – nearly all of whom willfully suppress the price to maintain history’s largest, most destructive fiat Ponzi scheme.
Yes, I am WELL aware of goldbugs’ endless mantra, that one day the physical market will overwhelm the paper market, causing prices to explode and the Cartel to flee with their tails between their legs. The problem being, that if that ever occurred, it would likely destroy the Precious Metal markets entirely - to the point that liquidity would dry up, and holding gold and silver extremely dangerous.
Likely, it would accompany the worst-case scenario of a global fiat collapse – in which case, governments would do everything in their power to source physical metal…like, for instance, shutting down coin shops and metals dealers, or outright confiscating bullion coins. It’s not like it hasn’t been done before, that’s for sure!
Moreover, the miners Peter Schiff so loves – which I owned from 2002-11, and worked for from 2006-11 – would be destroyed far worse than they already have, as unquestionably THE worst asset class of the past 40 YEARS. The reason being, that if gold became so valuable (in a collapsing fiat environment) that governments want to source it, the FIRST thing they’d do is confiscate all mine production. I ASSURE you, this is a big reason they trade so poorly relative to gold and silver prices – and why frankly, they are barely Precious Metal proxies at all.
FYI, Warren Buffett is already down on his Barrick Gold investment – and I’m going to thoroughly enjoy watching him squirm when this HORRIBLE company, which itself has been associated with gold price suppression, winds up, one way or another, atop his growing list of stock market failures.
As for silver, it LONG ago lost ALL monetary value – though it still maintains the legacy directional correlation it has had with gold for centuries. Today, it is principally an industrial metal; and the fact that it is STILL less than half its 2011 peak, which is also its all-time high from 1980, should tell you all you need to know about how “valuable” it is.
I mean, if you think gold is bulky to hold and impossible to transport (one million dollars’ worth weighs 33 pounds), consider that $1 million of silver weighs 2,700 pounds! Thus, nearly all material silver holdings are stored with custodians, who not only can steal it or allow it to be confiscated, but charge exorbitant fees whilst doing so.
If you own paper gold and silver, they will ALWAYS be the death trap they have been since January 1, 1975, the day the COMEX was launched with the explicit purpose (per leaked Fed and Bank of England documents) of suppressing prices. To that end, do you think it “coincidence” that after being banned in 1933, physical gold and silver ownership was re-allowed on…wait for it…December 31, 1974?
If you own physical metal, it will become increasingly obvious that in the Digital Age, they are FAR inferior to Bitcoin in every way. This, with a dramatic valuation disadvantage to start with, given Bitcoin’s $200 billion market cap vs. $10 trillion for gold. With each passing year, BTC’s expanding outperformance will be a glaring reminder that goldbugs SHOULD have understood its superiority, but didn’t do anything about it do to inertia - and listening to compromised commentators like Peter Schiff, who MUST defend his legacy to the death, due to the irreversible corner his ego painted himself into.
Moreover, if the “best case” Precious Metals scenario occurs (fiat Armageddon), physical metal will become dangerous to hold; likely, impossible to sell; and very possibly, confiscated…whilst simultaneously, mining stocks would likely become worthless.
Furthermore, if PM prices do indeed surge, increased capital investment – by private companies, or the governments that confiscate miners – would likely yield significant production increases. Let alone, if new technologies are invented to mine sea water - which, as someone who was an oilfield drilling analyst when deepwater drilling was invented 15 years ago, I ASSURE you is eminently possible.
Finally, with 100% CERTAINTY, I am telling you that as the Baby Boomers who own nearly ALL the world’s retail gold and silver die over the next two decades, essentially ALL bullion coins they pass on to their Millennial and Gen Z heirs will be sold for digital assets, principally Bitcoin. In other words, Precious Metals demographics could not be uglier – in contrast to Bitcoin’s, which couldn’t be better.
I have been saying this for nearly four years now – so loudly, I got fired from my position as Marketing Director of a major bullion dealer for doing so (in August 2017) – which led to my creating CGC in September 2017, to become one of the world’s most prolific, and vocal, Bitcoin supporters.
So, to all goldbugs, Peter Schiff followers, etc, this will be my LAST warning. Sell your bullion and mining stocks whilst you can for Bitcoin, or forever regret that you SHOULD have known this was the right thing to do, but DIDN’T do anything about it due to ego, inertia, or both.