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Imagine waking up tomorrow to find that gold has shot up to $10,000 an ounce, while the gold mining stocks in your portfolio have barely moved . Then imagine gold falls back to 9,000 and these exact stocks are still completely crushed. Sounds absurd, doesn't it ? And yet, according to one of the loudest voices in the gold scene, a smaller version of this absurdity played out on the market a few days ago.
Gold reached an all-time high, yet the companies that extract it from the earth were still punished. Something does n't add up here. By the end of this video, you'll know exactly what he suspects is behind it and why he believes the real story has n't even begun yet. Before we continue, press the like button, subscribe to the channel and activate the bell so you don't miss any more analyses like this one .
And stay tuned, because the most surprising part is yet to come and it has nothing to do with the price of gold itself . Let's start with the setting. At the end of April 2025, Gold experienced one of the wildest weeks in its recent history. At the Comex, the most important futures exchange, the price climbed to a record of around $3,500 per ounce.
Then it fell almost as quickly again and landed below 3,300. Traders who had just been celebrating stared in disbelief at their screens. The increase was driven by fear, quite simply. Investors were nervous about politics, nervous about the economy, and nervous about what might come next. And when people get nervous, they like to escape into gold.
Two things had fueled this nervousness . Firstly, President Donald Trump had openly criticized US Federal Reserve Chief Jerome Powell, raising doubts about how independent the central bank really is. Secondly, it looked as if the trade tensions between the US and China could drag on for a long time.
Moreover, Trump suggested that the American economy could slip into a recession if interest rates were not lowered immediately. This put massive pressure on the Fed and made gold more attractive to everyone worried about the future. But the meteoric rise did not last. Trump backtracked on his earlier threats to fire Paul and expressed cautious optimism about renewed talks with China.
The fear subsided and gold gave back a large portion of its gains. Anyone who only looks at this one week might think the gold rush is over. Peter Schiff, the economist and well-known gold advocate, says that would be a grave mistake. Schiff argues that short-term fluctuations like these do not change the big picture at all.
His theory is based on debt. The US national debt already exceeded 36 trillion dollars, and in his opinion, such a huge mountain left the Federal Reserve with little room to maneuver. In his view, sooner or later the Fed will be forced back to aggressive money printing, regardless of what those in charge say today.
He also warns that any boost to the dollar cannot be permanent because the financial imbalances in the major economies below it continue to build. Importantly, this is his prediction, not a certainty. Many economists disagree with him, and we will also look at their side. According to Schiff, the real danger is a gradual loss of confidence in paper money.
If people worldwide no longer believe that currencies will retain their value , they will increasingly shift their savings into gold. He also points out something interesting about how much the debate has changed. Nine or ten thousand dollars per ounce used to be considered ridiculous, a number that made people chuckle.
Today, he says, institutional investors take them seriously, and that alone shows how drastically the mood has changed. So what does he think of the recent setback? For him, it's a break within a much longer run. He and some other gold strategists see current prices as an early chapter in a potentially historic bull market.
They point out that central banks are continuing to increase their gold reserves, which suggests that some governments are losing confidence in a dollar-based financial system . Add to that persistent inflation, growing political tensions, and ever-increasing national debt . And according to Schiff, that creates the ideal environment for gold.
He even goes so far as to say that the 3500 was not a ceiling at all, but rather the first step in a multi-year reassessment of the metal. Now we come to the part that really enraged Schiff and which most people overlook. Gold fell by about 3% in the same week. The major gold mines fell significantly more.
The GDX, a popular fund with large mining companies, lost around 6.5%. And the GDXJ, which contains smaller mines, lost about 7%. Schiff's reaction was essentially: Why? It simply wouldn't make any sense. Yes, gold has fallen, but only to 3300. And that is still an incredibly high price compared to what analysts had expected in profits from these companies .
Think about it for a moment . A year earlier, no analyst in the industry had expected gold to even come close to 3300. When gold reached the $2,000 mark a little over a year earlier, most people were convinced it couldn't possibly go any higher. Now the price was more than 50% higher. And here comes the twist that the ship keeps coming back to.
Two of the biggest names in the industry, Newmont and Barrick, actually traded lower than when gold was at 2000. He admits that some other mining stocks are trading higher, but not these two giants. So, if gold has risen by half and the largest producers have fallen in price , what exactly is the market pricing in ?
Then came the quarterly figures. And this is where the story gets even stranger. Newmont was the first major gold producer to report and publish its figures on a Thursday after the close of trading. According to Schiff, the company exceeded analysts' profit expectations by 42%. This isn't just a minor surprise, this is a massive bombshell.
Sales in the quarter were 25% higher than in the same period last year, and profit jumped by 127%. Schiff pointed out that Newmont is the only gold company in the S&P 500 and asked how many other companies in that index could report such a jump in profits. With figures like these, you'd expect the stock to skyrocket, right?
Gold had even risen by around $50 that day. The timing couldn't have been better . And yet, according to Schiff, the stock only rose by about 2% in after-hours trading . This is the moment when he returns to his initial question. If gold rose to 10,000 and then fell to 9,000, would mining stocks really need to be dismantled, especially if they barely gained any value on their way up ?
He sees the market reaction as completely detached from what the companies actually earn. Why does he think this keeps happening ? His explanation dates back years. Gold has been undervalued and underweight for a very long time . Most investors simply don't own one. Central banks do own gold and have recently been buying up large quantities, but if you measure their gold as a proportion of their total reserves, its value is still historically low, according to Schiff.
Not as low as before, but still below the long-term average. The reason? Currency reserves, especially in US dollars, have virtually exploded over the years , making even large gold purchases seem small in comparison. According to Schiff, both sides of the market have therefore underinvested in gold.
Private investors own very little, large institutions hold little of it, and central banks hold less relative to their reserves than before. The result, he says, was a gold price that remained lower than it should have been, given the amount of newly created dollars and the huge American trade deficits .
And that had a bitter consequence for the mines. While the price of gold lagged behind, its costs continued to rise due to inflation. They experienced rising expenses without receiving the full benefit of a rising gold price. In other words, they were caught in a pincer movement from two sides at once.
But this clamp, says Schiff, is loose. Since around the beginning of 2024, the price of gold has far outpaced the production costs . This means that the gap between what it costs to mine an ounce and what it is sold for has become very large. His accusation is that Wall Street hasn't grasped this yet.
Analysts and major investors have not adjusted these stocks to the new reality. Therefore, the market would eventually have to value them significantly higher, even if gold fell by a few hundred dollars, because the profit margin is already so enormous. Now he is becoming bold, and I ask you to pay close attention, because that is the core of his prediction.
He pointed to the level reached on Monday of around 3490 and said that this was not the highest level gold would ever see and probably not even the highest this month. He believes gold will exceed 3500, then 4000, and finally 5000. And when that happens, he asks, what should mining stocks be worth? While production costs do rise with inflation, they do not rise nearly as quickly as the price of gold in this scenario.
And the more investors realize how serious and long-lasting inflation could be, the further, he expects, they will drive the price of gold upwards. Let's zoom out for a moment, because this isn't just about mining stocks or the opinion of one man. The rise in gold and the pressure on the dollar are closely linked to a larger concern: whether the dollar will retain its dominant role in the world.
This concern has been growing for years. Part of this is due to rising US debt, another part to the emergence of alternatives to the dollar. When the dollar is shaky, gold, which people have trusted as a safe haven for centuries, tends to attract more buyers. That's exactly what investors seemed to be doing when gold set new records .
Schiff also warned that life in America could change in ways that hardly anyone can imagine. He is known for his pessimistic view of the dollar. So it's not surprising that he says this, but the message is sparking real debate. Whether the change will manifest itself in higher inflation, wilder markets, or a deeper shift in the global financial system, nobody knows.
What we know: Gold has risen primarily due to a weaker dollar, and silver has followed suit. Their movements point to a larger theme, namely that traditional currencies could face serious tests in the coming years, and gold and silver offer clues as to how the system is adapting. And now comes the part I promised you , which doesn't use any price charts.
Schiff described what he observed on Monday evening . And that's quite a story. Gold had reached a fresh record high and was only $10 below $3500. After such a long and rapid rise, profit-taking was natural, especially at a round number. Gold had only just surpassed 3000 weeks earlier and was now almost halfway to 4000.
At the same time, however, the dollar was being brutally beaten. The dollar index was at a level in the 90s, stock futures declined, and bonds were under pressure. A brief note about the numbers. Schiff said the euro was above 115, which almost certainly refers to a euro exchange rate of about 1 to 15 dollars .
Therefore, take this number as a spoken abbreviation and not as an exact quote. According to Schiff, that was the moment when everything changed. Given the pain across the markets, he believes that Trump's advisors went to the president, told him it was time for damage control and that he needed to retract his social media post about Powell.
And indeed, early Tuesday morning, Trump did exactly that, declaring that he had no intention of removing the Fed chairman. The markets recovered strongly. Schiff then went a step further, suggesting that people close to the government, many of whom come from Wall Street , know perfectly well that a single comment from the White House can move stocks, currencies and crypto assets, even if nothing has actually changed .
He said he would be surprised if some of them didn't trade on these fluctuations. I want to be very clear here, because this is one of those moments where care matters. That is Schiff's speculation and his personal opinion. He presented no evidence that anyone had traded on these movements and even admitted that he was not sure whether it would even be considered insider trading , since nothing concrete had happened.
He also argued that Trump's comment about Powell may have been aimed at calming markets and reassuring them that the Fed remains independent. Consider this a theory worth thinking about, not a proven fact. Schiff, however, takes a firm stance regarding the Fed itself. He says that the more a central bank becomes entangled in politics, the worse it gets, because political pressure almost always pushes towards cheap money and lower interest rates.
Therefore, he found it strange that Trump accused Powell of acting politically because he was keeping interest rates stable. From Schiff's point of view, resisting the pressure to lower interest rates was in reality the more independent decision. He went even further, saying that given inflation, the Fed should actually be raising interest rates, and that its failure to do so was itself a sign of political pressure.
Again, this is his view, and many economists would disagree, considering inaction a sensible middle ground. There is another big piece of the puzzle, and that concerns the question of who is secretly buying gold. The price increase is closely linked to a trend called dedollarization, in which central banks increase their gold reserves to become less dependent on the US dollar.
In 2024, central banks increased their reserves by around 1030 tons of gold, the second-highest annual amount ever recorded. China played a key role in this. The country resumed its gold purchases in November 2024, increasing its holdings to approximately 2000 100 PX and 60 tonnes, reportedly representing more than 5% of its total reserves.
Many analysts see this as an attempt to become less dependent on the dollar, even if governments rarely express their motives so openly. Private investors are now also involved. Demand for gold ETFs and physical gold such as coins and bars is growing because people are seeking protection from uncertainty, inflation and currency devaluation.
When central banks and ordinary buyers move in the same direction at the same time, it strengthens gold's reputation as a key reserve asset. That's the image the ship wants to convey to you. A world in which more and more players are quietly betting that gold will be more important in the future than in the past decades.
Now we want to be fair and also shed light on the other side , because no honest analysis is complete without it. Gold had already risen enormously in a short time, and sharp rallies can reverse just as sharply. If inflation eases, if trade tensions relax, or if the Federal Reserve acts tougher than expected, the demand for safe havens that has driven gold higher could weaken.
A stronger dollar could also put downward pressure on prices. And mining stocks bring their own risks that have nothing to do with the price of gold, such as rising costs, operational problems and political unrest in the countries where the mines are located. These risks could explain some of the market's reluctance towards the mines, and Schiff's view that Wall Street simply missed the opportunity is only one possible interpretation.
So where do we stand ? On the one hand, we have Schiff, who believes that gold is at the beginning of a historic run and that mining stocks are massively misvalued. On the other hand, there is the possibility that the markets are doing their job and pricing in risks and uncertainties that a bullish voice might downplay.
The truth may lie somewhere in between, and only time will tell which view came closer to reality. What's fascinating about this story is that the same events look like a warning sign to one person and like a golden opportunity to another. Here's the thought I want to share with you. Markets don't always reward good news immediately, and sometimes the biggest gap between price and value opens up precisely when everyone is watching to see if Peter Schiff is ultimately right or not.
The questions he raises about debt, trust in money, and who actually owns gold are questions worth considering for oneself. Keep asking, always double-check the data yourself, and never rely on a single vote, not even his or mine. That's it for today. If this analysis has given you a new perspective , give the video a like, subscribe to the channel and activate the bell so that the next video arrives directly in your inbox.
And tell me in the comments, do you think gold is only just beginning its run or is the party about to end? I read every comment and look forward to your opinion. A quick note: This video is for educational and informational purposes only and does not constitute investment advice. Investments in gold, silver, and mining stocks involve risks, including the potential total loss of your invested capital.
Please do your own research and speak to a qualified financial advisor before making any investment decisions. Thanks for watching and see you in the next video.
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