Stagnation

Earlier this week, renowned economist Peter Schiff sharply analyzed the current state of the global economy, criticizing the shortsightedness of retail investors and Wall Street, and painting a doomsday scenario of fiscal disorder in the U.S.

Regarding the valuation of gold stocks, Schiff points out that the market has a systemic misjudgment:

"Retail investors have almost never made the right judgment about any asset. Since their cognitive bias towards gold has reached a historical extreme, this instead foreshadows an epic bull market for gold. The truth behind the current rise in gold prices against the trend is: when retail investors sell gold, central banks are frantically accumulating it. However, central banks only buy physical gold, not silver or gold stocks. Wall Street institutions always assume that future gold prices will be much lower than the current price when pricing gold stocks. They do not believe that this bull market can last, so even if gold prices continue to rise, they still refuse to increase their holdings of gold stocks."