Crypto-Skeptics Peter Schiff and Nouriel Roubini Bet on Gold as ‘Mother of All Debt Bombs’ Looms

The Turko-American economist nouriel roubini and the peter schiff critic believe that a lower dollar will allow gold to prosper in 2023, Central banks are being forced to the wall by high levels of global debt.

Contrary to the widespread consensus that predicts a shallow recession in 2023, accompanied by rising equity prices and falling bond yields, Turkish-American economist Nouriel Roubini expects inflation to persist alongside an economic slowdown.

Central Banks Trapped by High Levels of Global Debt

Roubini says that the economic slowdown caused by repercussions of Covid-19 shutdowns, the impact of the Ukraine-Russia war on oil and natural gas prices, and China’s zero Covid policy have all contributed to rising inflation. All three factors have weakened supply in spite of rising demand.

“All these factors combine to drive up production costs and reduce economic activity. That’s what we call a recession,” the economist asserted in a recent Kitco NEWS interview

Despite efforts by central banks to curb inflation, Roubini argues that rising interest rates will cause an economic crisis unless the amount of global debt is reduced.

“So we’re entering recession by tightening monetary and credit policy, making the recession worse, while raising the debt servicing ratios of the private and public sector with higher interest rates,” he warned.

Peter Schiff's gold and bitcoin bug is fine.

"finally, interest is the only thing you will spend money on," schiff said in a recent interview. Schiff also notes that the increase in rates did nothing to encourage consumers to save more and spend less.

Nick Gerli, a real estate consultant, confirms that the American savings rate fell to its lowest point since 2006-2007, just before the 2008 financial crisis.

An anonymous source Reuters said the Wall Street investment bank Goldman Sachs would be downsizing on 11 January, 2023, as a result of a $15.3 billion decrease in investment banking revenues in the fourth quarter of 2022 compared to the previous year. Analysts expect JPMorgan Chase, Bank of America, Citigroup and Wells Fargo to report a 1.7% decrease in earnings compared to the fourth quarter of 2022 on January 13, 2022.

Analysts also expect that the big four will raise $5.7 billion for loan defaults in 2023.

Gold will appreciate in the context of the weakness of the dollar in 2023.

Schiff and Roubini agree that gold is going to be the bright side of a bleak outlook for 2023.

According to Roubini, gold did not perform well in 2022 due to a strong dollar. In the context of the weakening of the dollar, it projects that gold will appreciate by a large percentage to a number or a small percentage to two figures over the next decade. 

Schiff agreed, "I believe 2023 could be one of the lowest years on the dollar." He also predicted that those who invested in bitcoin rather than gold during recent high inflation will "lose a lot of money in 2023." He says that Bitcoin has a price, despite having “no value,” and people will soon “wise up” to this reality.

While many support Bitcoin's merits as a cover for inflation, schiff says that most bitcoiners expect the value of the cryptocurrency to increase considerably instead of preserving wealth, This is not an exact measurement of the value of a coverage. He noted that gold increased by 11% during the first four days of the year's stock exchange.

Whereas it is not on the gold side of the barrier, black swan author nicholas nassim taleb that low interest rates are pushing asset bubbles as bitcoin, He calls it a "malignancy." taleb once favored bitcoin after having been in disagreement with the federal president ben bernanke's "transitory" response to the 2008 financial crisis.

Notwithstanding the misfortunes, Executive President of Microstrategies, which invested the software company's cash surplus in Bitcoin in 2020 to protect shareholders from the then-weak monetary policy of the Federal Reserve, has recently reaffirmed its confidence in assets.

As opposed to people who invest in assets for speculative gains, Saylor recently supported in a Twitter space that those who see Bitcoin as right for the human race would go in the long term, even until the age of 100.