Investor who bet everything on gold was right; here’s his forecast now

our next guest is another well-known name in the industry peter granted of peter greenwich company uh welcome back peter it's been a long time you don't do a lot of interviews it's always an honor to have you back well it's a great honor and the main reason i do this is because it's kick-out thank you very much for your kind words peter peter you've been a big fan of gold for a long time and offline you were telling me that two years ago you sold everything and bought gold uh tell me why you made that decision two years ago when gold was still nowhere near its all-time highs so you're right it's just about two years ago to the day with gold trading on either side of 1200 that i decided to move out of the general equity market including my bond holdings and uh put all of it but one equity general equity into gold and gold related investments whether they were etfs or mining chairs and physical bullion and i haven't looked back since i've maintained that all the way to today that we speak at the time what was the main rationale behind behind your decision did you see potential risks inequities did you see volatility in the markets that you needed to be protected from did you see a lot of geopolitical tensions rising or what were the macro factors behind your decision peter well starting at home it was considered a very irrational move and throughout my clientele as well the thought of moving out of general equities which at that time still had not come close to even like where the nasdaq is now it was a broad feeling that the market continued going higher interest rates would drop and people were basically across the board uh calling gold relic and a lot of worse things it was more of a contrarian view than anything else i had not been in gold for a few years up until that and uh yet when i looked at it known its history understood or felt what was happening uh economically politically and socially it seemed to be a much more undervalued than the general equity market so it wasn't a gold bug kind of thought that did it it was really valuations apples to oranges yeah and and and of course uh through most of this rise it's been that now of course it's taking greater importance because of some of the things that are happening that weren't happening two years ago when you when you talk about valuations for gold what were the valuation metrics that you were basing your decision on were you looking at the dow to gold ratio were you looking at uh gold relative to gold stocks were you looking at gold relative to historical averages what how did you value gold in your mind well you know i've been at this 36 years i've never been the person that used the general guidelines i've always been somewhat called a maverick or what have you to me it was more of a pure contrarian plane everywhere i looked uh the former goldbug in society had been broken up the hot asset group had moved into cryptocurrencies and marijuana stocks mostly across the board in what we call mainstream wall street i formed the don't worry happy crowd they treat gold like kryptonite as to superman so it was really because there was no real interest and even the people that used to have a big interest had moved away to me i would say the number one reason at that point in time was as a contrarian it was just screaming by it just it was just really other than the people that always promote gold there's still a few they've been around 30 years if they live another 30 years they'll still be promoting it but there really was nobody else seemingly wanting to own it and that's what really caught my eye more than anything else so why a 100 allocation to gold have you considered other safe haven assets like treasury bonds um you know swiss francs us dollars how did you how did you make the decision to buy uh put all your money into one basket so that would be what i would set aside for my portfolio i owned real estate separately uh i never i never used uh treasury bonds which are you know pure safety reasons uh as a general portfolio was really just not being in general equity stocks up until that point i had the typical portfolio it was based you know technology stocks things of that nature but at that time it just seemed and it might have been because i spent 25 years working within the metals and mining industry and everything that i used to believe that needed to happen at a major bottom seemed to occurred most people have left most people don't consider it it was widespread you couldn't pick up a media report within two days and not reach somebody's panning goal and telling how i was going to go under a thousand and all so whether it was gold or copper or or coco just the fact of how everybody was looking at it really made me feel and i felt i had to be aggressive and i didn't think there was a lot of downside risk you know i learned a lot of things in 36 years and one of the things i learned is it's not how much you don't make it's how much you prevent losing and at that point i thought there was a lot more risk to the stock market going further down than gold going much below 1200. okay that's a very good point peter now you've certainly made the right call as uh history would prove you right how do you feel about today's prices we've just seen gold breach all-time highs earlier this week how do you feel well as you know back then i spoke even then that i felt by the year 2021 if not sooner we would make an all-time nominal new high which we did i believe things changed dramatically for the positive for gold in may and and i've i've used it on my blog and when i still tweet and that is what jay powell said in the infamous what i think will go down in history as is in 60 minutes when basically within 30 seconds he basically told the interviewer yeah we just print money and we're going to keep printing money and uh his comments a few days ago that uh he's throwing everything in the kitchen sink in order to preserve the capital markets there are gold bugs that i used to know that passed on are probably standing up in their graves going i can't believe it's finally happening i'm not there to enjoy it these are these are these are dream scenarios it's like a perfect storm to come together from all the things we used to talk about for years that never happened monetary concerns political concerns social unrest all those things that used to be selling points by the hot asset crowd but never materialized have all come together now at this point so for me now it's no longer a valuation it's really an alternative and a protection that is something that simply is for capital appreciation peter if you if your portfolio was the same it was as it was two years ago meaning if it was all equities today would you still make the same decision today as you did two years ago to allocate all your assets into gold and away from equities given today's situation that's a very good point and i'm going to tell you what that's why i wanted to do the interview with you because i find you very very sharp because one of the things i can tell people in 36 years is people always say oh your financial advisors always tell us when to buy but you never tell us when to sell well one of the first reasons you should consider selling is if you can't first buy what you have today at today's level and to answer your question is i don't think i would do it as aggressively in fact my personal plan is as we appreciate after what should be at least a consolidation it's not a fairly sharp correction for gold in the short term but as we get into the 2000 and something it's my plan to personally weed out some of my holdings and some of my some of the gold so the answer to the question is no i wouldn't be as aggressive but i would still want to be more out of the stock market today than i was two years ago um i was speaking to an analyst a couple weeks ago who told me this story actually that robin hood has seen a surge in activity from their users uh trading gold backed etfs and robinhood as you know is a is a trading brokerage online trading brokerage that has a primary user base of millennials so a lot of younger people um are starting to show interest in the gold sector where previously they hadn't before and uh how does this change the landscape for the gold invest for gold investments at large well for me contrarian by nature you get concerned when you go from basically the only person in the boat to all these young kids piling into the boat yeah but that is always what normally happens at the latter stage or what tends to be the most explosive stage of bull markets and that we're only starting to see so that's why i don't believe as much as people call if those kids are in i'm getting out is some of the things i heard from older investors no this is just the start of the explosive stage so uh i think there's a lot more upside to it but i think so much of it and all the markets are going to have a direct impact on what happens in the u.s election there's such a diverse different scenarios that can take place on something that's only going to happen a few months from now and uh when i look at all the potential scenarios all of them are positive for gold i can't say the same for equities and bonds so gold like i said to me remains in a perfect storm scenario something that many of us thought for years could occur and it's finally happened it's certainly in the twilight of my career what did you mean when you say that not all scenarios are positive for uh for equities and bonds like what what what are some negative scenarios for those assets well my advice to my clients of late is that by labor day we need to have a strong scenario of what can happen after election day and how that may impact our portfolios our investments our life et cetera one of the things that's missed in all it is is while the federal reserve has managed to print trillions of dollars that the your generation and others will pay for more dealing than i will that has helped for stall the realities of economic problems on a national level but in our state and local level they don't have printing machines and all of them have had to spend all sorts of money and borrow money they don't have so not many of them are going to talk about the cost of that until after election day but when that comes people are going to realize that states and cities across the board forgetting social political issues for a moment just general services are going to be cut dramatically and taxes are going to have to be raised dramatically and the and the likelihood if the democrats take control of the presidency and or the senate uh there'll be a far ramper up on taxes for instance one of the areas even in the state that i live in new jersey which had removed an estate tax we're going to see that again in our hard way we just had to borrow over 10 billion dollars just to keep the state going so there are a lot of economic issues that aren't yet in the forefront because you basically had a drug pusher named jay powell but why the addicts to people that are still hot on the stock market with more drugs so the party goes on and they believe it can't end because they'll always give them something else to keep the party going but that's coming to an end and it's certainly in my view shortly after the election will be over no matter who wins and then that's where i see some very serious problems going forward for the stock market and what's left of the fixed income market one of the things the federal reserve has done is not only destroyed the fixed income market but it's actually terminally yields the retirement planning market because how do financial advisors make plans for people for retirement when there are no more interest rates to make them on we're really forcing people to have to speculate more and more to secure our hope for retirement so there's a lot of things that we can spend a lot more time than i know you have the troubles of that they probably won't occur until after the election but after it they're all going to come out we're going to pay at their price for it peter what are the next key levels for gold that you're looking for well once you've made a new all-time high i don't know how i know there's guys out there i used to be a bit of a again angled person very few people use them i mean the numbers david the thing that i find most interesting about this time i used to hear a lot of shows and guys who talk about five thousand ten thousand and finally i couldn't laugh i was the emcee but i would turn my head and laugh because not only was it kind of silly to talk that but the conditions that would have to exist to get us there well you know something a lot of those conditions now exist so the guys and gals that do speak about three four or five thousand dollar goal it is a realm of possibility for me i think there's still you know three four five hundred dollars in the next twelve months but you know if we do get the four or five thousand in 12 and 24 months i can tell you my scenario about the economy socially politically must have occurred because that's the only way gold's gonna trade at four or five thousand dollars an hour wait a minute you just made a key point here before you didn't think that these five thousand dollar gold price predictions were sensible because of the conditions before but now they make sense what change in the economy peter well it's not just economy uh well for starters we now talk in trillions we don't even use billions anymore uh that debt it's a raise to the bottom for currencies all current major currencies are being debased uh politically i listen there is no more middle at least here in the united states i don't follow canadian politics but uh there is no more middle you're either basically to the left but to the right and uh right now there's 50 or more people that wish and would see the whole country implode if it meant that the guy that's currently president isn't president again and so all these things come with a price tag there's there's prices to pay so socially uh you see it every night on the news politically we just touched on and economically we have to spend trillions of dollars of new money just to keep things afloat so these are all scenarios that weren't realistic 5 10 20 years ago but are now before our eyes so for the first time ever the gold bugs of the world the guys that always talked about crazy numbers have a legitimacy to stand and talk about those numbers peter you said offline that uh this would be your farewell address to the media this would be your last media appearance well i speak on behalf of all media i think that we're very sad to see that happen and i'd like to just recap what um what you've learned over your decades of experience here in your 25 years of service in the financial industry what were the key lessons you've learned well there's 25 in the middle 36 years old together you know after you've made and lost millions not once or twice the reason my book is now called the former wall street wizkid versus the wall street wizkid is no one knows the future of almighty god you know one of the things i can tell you and i know you have some great guests on and they're worthy to listen to but what i learned after looking in a crystal ball for a few decades is all i became as an expert on how to eat a lot of broken glass so the first most important thing is to not to think that you know what the future's going to be the markets don't do what you think they should do all the time uh that was the first hard lesson the second lesson we kind of touched on is you know when do you buy and sell and again i think a primary reason is you begin to think of selling if you couldn't first buy it now but i think one of the things if you had to put something on my uh cemetery plot it would say the ultimate crime in investment is not being wrong done that it's staying wrong and that's the hardest thing to do when using ego and pride and other reasons get involved and keep the position that really you shouldn't be in and there's a whole host of other things but i think those are the primary things that i would be uh concerned about and let me just add daniella who i presume will be back uh and picco's been the only gold source that i've used from day one and continue to use today and quite honestly david that's the reason i felt i didn't mind doing an interview but i'm basically done in the secular world uh doing media interviews uh but i will continue working uh in my catholic christian faith and faith spend time with that but there was no better place for me to go out on than on peter those are really kind words i really do appreciate you uh supporting kitko and educating our viewers with your views um peter you've lived through and worked through uh many great economic and political events we've seen you've seen inflation in the 80s you you worked through the crash of 87 you saw the tech bubble of 2001 you've worked through 2008 2009 and now 2020 i mean these things sort of see a pattern these black swan events that people talk about that should really occur once in a million years seem to occur once a decade so you know how should you as an investor what what are some parting words of advice you leave for investors who should be prepared for the next black swan event well to be fair and i don't take this personally because of your age but right now in the u.s two-thirds of the financial advisors have only been practicing since the new millennium started and almost one third of only since the last financial crisis started so one of the concerns i have right now is there's not a lot of experience from well as you just stated what i've gone through by people that are being responsible to give other people advice uh you know one last thing and if i can tie that to gold i i've heard for several years now younger financial advisors even in the place where i still run my insurance business through talk about how great the stock market's been and i point out to them that since 2000 uh began gold has outperformed the stock market and they look at me what are you talking about this is you know a couple few hundred dollars below where we are and it's true it was under 300 on you know when january started in the millennium it's uh up 500 and something percent stock markets up between 150 to 200 percent where they use the nasdaq and if you take the dividends and reinvest it and add another 100 150 gold outperformed the stock market and yet if you ask most financial advisors should i own gold they'll tell you no so one of the first things i would tell people is that uh i'm very concerned about the lack of true experience at a time as you just painted that things are becoming more volatile and uh troublesome uh with less and less time in between and as you heard me say earlier i really believe truly in my heart of hearts there's one thing i hope i'm wrong but i i kind of feel i'm going to be right and that is it won't be long after election day no matter who ends that we are going to be in for a very long period of downturn economically and of course socially and politically will continue to be uh extremely volatile so uh i would just tell people they they have maybe a few more months but at best but after that i think things are going to be very very challenging for a very long time so the party is over for stocks is that what you're saying well when when you have to have creations of trillions of dollars and even after just the other day when he said he's going to throw the kitchen sink and then a day later we're down 500 points i think the market's starting to tell you is it's not getting the drug is not getting as much bang for the dollars that it used to and uh one of these days the moment they don't think it works anymore uh did this the bottom or a decline that we've never imagined could happen will take place finally peter offline you're telling me that you are also ending your work with some professional athletes athletes can you tell us a bit more about that well yes 20 years ago i started with a former new york giant football running back a financial advisory service for christian athletes and it grew and we have a distinguished board in recent weeks because of what's happening here in the u.s socially politically i have been outspoken about my views my blog on my twitter page i shared that i will only kneel for god and country uh i believe my lord and savior jesus christ came for us that all lives matter equally so no one group should stand out before another and i also stated that what professional sports was deciding to do uh in getting behind all the social aspects was a mistake and the way i described it and i'll just end this by telling you what i told one of the athletes that left me we went out for lunch to discuss my views and i pointed to him the busboy the waiter and the cook what if they came out here right now to start arguing with you why you're wrong in your views and his opinion was well this is not the place i've come here to eat and i said there you go we're at a leisure and entertainment industry and guess what you guys play in the leisure and entertainment industry and people pay a lot of money to buy very expensive hot dogs and beers now to watch you play and get paid an absorbent amount of money for a game that god blessed you with a talent that most will never have and people would do for a lot less and they come there to get away from the very things that you're now bringing to the forefront and uh that's my view athletes don't agree with it so it was best that i move aside and not deal in that industry anymore all right what's that what's that jersey you're wearing now you want to show the audience you can see that because i want my friends in vancouver to see that i don't think i don't think they'd be very happy to see that they were my homes away from home i still love canada very much the greatest movies in the world that every canadian american should watch is canadian bacon it really shows how really no two countries are better allies in the whole world than canada and the us but i was known as the antichrist of hockey in vancouver because i would uh make fun of the fact that they still don't have a stanley cup and we had three and none of us in new jersey can name any of our players and an 11 year old in vancouver can name every player in every statistic so if my friends from vancouver still see me we still have three and you still have zero you know i actually uh it's good you brought it up because i i grew up in vancouver we were close that one you remember they play the uh boston bruins in their scally cup final but they lost um they were close they were close are you ever going to wear a canucks jersey well i actually did i wore it at the last conference that i spoke in vancouver even though i won the bet because the original bet was i would wear it if they lost and that was my conciliatory but i will tell you this uh canada god bless you you put up with us at times because we can be really idiots and it's just a wonderful place to visit and if we can ever get past this pandemic i hope the good law allows me to go back and see those beautiful towns before i pass yeah well peter on behalf of all our viewers i want to thank you for your many years of service the financial industry and uh if you ever change your mind and want to do another interview you know who to call yes and and by all means if i may also say daniella peace be with you and god bless your two children they'll have long and happy lives i'm sure she'd be happy to hear that message thank you very much peter for your time today and um all the best thank you for watching kikko news we'll have much more for you stay tuned [Music] you

Channel: Kitco NEWS

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Keywords: gold, silver, finance, news, investing, investing news, finance news, financial news, economy, precious metals, gold price, silver price, gold price today

Id: zclAh9RiOfo

Length: 24min 36sec (1476 seconds)

Published: Fri Jul 31 2020