Silver's $5 surge. Why it's a huge mistake to ignore its significance.

The Spaces opened with Peter Schiff framing an extraordinary metals surge: silver jumped about 10% to roughly $79, platinum ~9%, palladium ~13%, and copper hit a record near $5.85/lb, while gold made fresh highs above ~$4,530. Schiff argued miners remain dramatically underpriced versus spot, expecting a Q1 re‑rating as Wall Street money rotates out of crypto. He forecast gold near $5,000 and silver $100 by Q1 2026, with longer‑term potential for $300 silver and a gold/silver ratio compressing toward 50:1 and possibly 20:1. He tied the rally to a looming dollar and sovereign debt crisis, central bank gold buying, and the Swiss franc’s strength, predicting stagflation and a depression if policy stays dovish. In Q&A, Doux Pico asked about gold‑backed Treasuries; Peter sees gold reserves as eventual stabilizers but expects inflation and QE to worsen first. Callers probed Supreme Court rulings on Fed independence and tariffs, miner hedging, oil’s divergence, and uranium/copper demand. Schiff advised accumulating quality miners, hedging energy costs, using self‑directed IRAs for precious metals exposure, and avoiding crypto given MicroStrategy’s fragility and expected whale selling. He highlighted new industrial silver demand (solid‑state batteries) and potential supply constraints (China curbing exports), reinforcing a secular metals bull case.

Day-after-Christmas Space: Precious metals melt-up, macro risks, and why miners lag

Market snapshot and context

• Setting: Day after Christmas. U.S. markets open; many English-speaking markets closed (Boxing Day). Asia led the move in overnight trade.
• Precious metals surge (intraday quotes referenced during the Space):
  • Silver: +10% on the day, above $79 (up roughly $7–$7.4 intraday). Schiff emphasized it’s now ~$9 higher than a week prior.
  • Gold: above $4,500, up about $50 on the day; making new all-time highs, albeit “outshined” by silver.
  • Platinum: above $2,400, up ~9% (all-time high, per Schiff’s remarks during the session).
  • Palladium: up ~13%.
• Industrial metals also strong:
  • Copper: new all-time high at $5.85/lb, +5% on the day.
• Equities of miners lagged sharply relative to metal price moves (examples he cited):
  • Hecla Mining barely up; Pan American Silver +~3%; Coeur Mining <3%; Endeavour Silver ~3%; Wheaton Precious Metals <2%; MAG Silver flat-ish. Schiff argued these are nowhere near commensurate with an 8–10% one-day move in silver.

What’s driving the move (Schiff’s view)

• Pent-up “catch-up” in silver vs gold: market long underpriced silver on the expectation gold would fall; as gold kept rising, silver had to “catch up.”
• Technical breakout: Silver broke a long-standing double top at $50; Schiff argued that unleashed momentum buying with minimal overhead resistance.
• Short covering and unwinds: Suspected closing of short silver/long gold spreads put pressure on gold but turbo-charged silver; broader short squeeze dynamics.
• Asia-led bid: consistent pattern this year—big metals rallies beginning in Asia’s open.
• New use cases and supply constraints in silver:
  • Potential large silver demand from next-gen solid-state batteries (Schiff cited recent news of a 600-mile, ~9-minute charge battery needing silver).
  • Structural scarcity: few recent major discoveries; silver mostly produced as by‑product; long lead times to bring new supply; silver designated a strategic/critical mineral in the U.S.
  • China reportedly halting silver exports in early January (caller “Christopher” raised; Schiff: more bullish for price).
• Macro tailwinds: rising global inflation pressures, weakening confidence in USD, central bank gold buying, Swiss franc strength near record vs USD.

Schiff’s media critique and prior calls

• Criticized CNBC’s Steve Liesman for claiming no one “pounded the table” on gold/silver earlier this year; Schiff says he did so on his podcast and X (noting Liesman blocked him on X). He urged buying silver in Q2 at ~$30 when gold was >$3,000, calling $30 a durable floor; repeated similarly at $40 and $50.
• Personal history: Schiff began buying silver under $5/oz decades ago; claims long-term vault holders (clients and himself) beat S&P 500 total return.

Outlook and price targets (Schiff’s view)

• Near/mid-term (Q1 2026):
  • Gold: “getting ready for another big run,” could reach ~$5,000.
  • Silver: “could easily hit $100” by then; acknowledges potential for pullbacks given speed of move but favors momentum on fundamentals.
• Longer-term silver framework: prior cycles saw 10x moves (e.g., 2001–2011); starting from ~$30 this time implies conceivable path to ~$300 over a longer horizon (not a near-term call).
• Platinum: still well below gold on a ratio basis; Schiff reminded listeners he championed platinum when 3:1 vs gold and says it remains undervalued even after the run (~2:1 now).
• Gold–silver ratio (to Cody): ~57:1 during the Space; Schiff’s medium target ~50:1; in a blow-off peak scenario, could compress to ~20:1 or lower. Silver is less essential now as monetary small-change due to digital fractionalization of gold, so he doesn’t assume a durable reversion to historic ~15:1, but extremes are possible.

Why miners lag and why he favors them now

• Analyst models: sell-side still embeds much lower metal prices into forward EPS, assuming current prices are “unsustainable.” Schiff thinks this is wrong in both direction and magnitude; he expects rising realized prices into 2025–2026.
• Sentiment headwind: investors fear metals will fall, stay underweight miners, and avoid revising estimates—keeping valuations depressed even as metals spike.
• Operating leverage asymmetry: Energy (largest cost input) remains cheap while realized prices soar—margin upside is significant if prices hold.
• Positioning call: Expects “wave of money” into miners in early Q1 as 2025 performance reviews highlight gold/silver leadership and crypto underperformance (Schiff’s contention). He specifically mentioned:
  • Silver equities he watches: Hecla, Pan American Silver, Coeur Mining, Endeavour, MAG, Wheaton.
  • Gold majors: Agnico Eagle (trading below its historical premium, in his view).
• Hedging (to July 9): Schiff prefers minimal revenue hedging (shareholders want upside), but endorses hedging some energy costs now; acknowledges some producers hedge modest gold/silver volumes due to lender covenants.

Crypto vs precious metals (performance, positioning, narrative)

• 2025 YTD framing during the Space (Schiff’s assertions):
  • Bitcoin: down ~7% YTD and ~40% below its high; MicroStrategy (BTC proxy) at new 52-week low ~$154 (52-week high ~$457); BTC ETFs “turned sellers.”
  • Gold: up ~70% YTD; silver up ~130–150% YTD (his rough figures in monologue).
• Trade he touted in 2025: Sell BTC, buy silver (“Bitcoin 2.0” idea he posted back in Feb/March when silver spiked to ~$31–32). Claims it beat AI stocks this year.
• MicroStrategy: predicts equity goes to zero before BTC does; says MSTR now buying Treasuries (not BTC) due to liquidity needs, with avg. BTC cost ~$75k—barely profitable at current spot—and heavy debt burden.
• Structural critique: BTC is a “Ponzi/pyramid,” not “digital gold”; if reserve currency confidence erodes, gold wins, not crypto. Tokenization can be done without blockchain; bitcoin’s lack of intrinsic value is fatal in his view.
• Admits early adopters made fortunes (including callers who bought on his early gold advocacy journey) but urges selling to realize gains; warns late buyers face large drawdowns.

Macro policy and politics (in Schiff’s words)

• Fed: “No hawks” left; all will cave to market and political pressures. Already back in QE “in denial”; balance sheet to “explode.” Will buy across the curve, including the long end. Rate cuts likely despite rising inflation (“they’ll ‘see through’ it”).
• Trump administration (as discussed in forward-looking 2026 context):
  • Expects appointment of a dovish Fed “yes‑man”; says Trump publicly wants lower rates and money printing—“destroy the dollar, cut rates to bare minimum, crank up the presses.”
  • Supreme Court catalysts (to “Alien”/others): Court could declare Fed “independence” unconstitutional, making it answerable to the President (Schiff says that would be bearish for USD, bullish for gold). Also expects tariffs to be ruled unconstitutional as revenue bills must originate in the House (with political narratives to follow regardless of ruling).
• Dollar and safe havens: USD is “no longer a safe haven”; CHF at/near record strength vs USD; central banks buying gold, not Treasuries—coupon insufficient versus FX depreciation risk.

Recession, stagflation, and a sovereign dollar crisis

• Severity vs 2008: Schiff predicts a crisis “orders of magnitude” worse than GFC:
  • 2008: USD rallied, CPI subdued; stocks recovered; bailouts worked within that framework.
  • Upcoming: declining USD, rising CPI (double-digit possible), bank failures without real bailouts; “shelves empty,” rationing/price controls possible.
  • Core issue: sovereign credit and USD reserve status at risk; can’t “print our way out” of a dollar crisis.
• Path: persistent deficits, more transfer payments, fewer workers → more money printing → weaker USD → higher import prices → stagflation or depression with high inflation.
• AI caveat: Rapid and massive productivity gains could mitigate (e.g., robotized domestic production), but he doubts the speed/capacity to offset near-term macro damage; warns AI capex cycle resembles past overbuild manias (e.g., Cisco/global crossing in 2000).

Energy and industrials

• Oil: “Too cheap” versus gold; expects a surge that will undo the administration’s only inflation talking point (gas prices). Speculates U.S.–Saudi arrangements may be suppressing prices. Personal positioning in energy as both investment and a hedge against jet fuel costs.
• Copper: Bullish; new ATH driven by electrification, EVs, data centers/AI power demands, construction, and constrained mining pipeline.
• Uranium: Long-term constructive, but after a strong run he sees crowded speculative flows—prefers to wait for sizable pullbacks in select names.

Portfolio, allocation, and rebalancing guidance (Schiff’s approach)

• Metals vs miners:
  • Likes both, but sees outsized upside in miners due to valuation lag and operating leverage, especially with low energy costs.
  • Exit discipline: He intends to sell when miners are “priced to perfection” and ownership becomes ubiquitous (akin to crypto’s retail adoption); not there yet.
• Rebalancing: Historically maintained 50% miners / 50% other equities; let it drift higher on miner outperformance, now adding to energy and emerging markets rather than trimming miners. For those with fixed allocations, rebalance prudently, especially in tax-advantaged accounts.
• Bonds: Avoids Treasuries/munis/corporates—sees inflation or default risk; prefers select foreign currencies (e.g., CHF) and interest-bearing cash vehicles for expenses only.
• Retirement plans (to “Brand”):
  • Review 401(k) menu for PM exposure; request plan additions if absent.
  • If permitted, roll to self-directed IRA to buy PM funds/individual miners.
• Private markets (to Adrian Boysel):
  • Expensive hype/momentum sectors (AI, meme, crypto-proxies) face downside even nominally; durable, dividend-paying value stocks—especially abroad—should fare better. Keep dry powder in real terms, not USD.

Selected Q&A highlights

• Doug Pico (former Navy officer): Treasury market “backed by gold”? Schiff: Ultimately gold will be key to restoring stability, but not before a high-inflation downturn.
• FOMC composition and “hawks” (Speaker 3): Schiff: No true hawks remain; policy will be politically expedient; cuts/QE resume, inflation tolerated until CPI forces action. If forced, could require gold backing and immediate, deep fiscal austerity (including real-time cuts to Social Security/Medicare).
• Pullback risk (Mr. Booke): Silver can swing ±$5/day in this tape; thin holiday liquidity can exaggerate moves, but this is a fundamental catch‑up, not a 1980 replay.
• Transportation costs (Mr. Booke in logistics): Expects trucking/shipping rates up as inflation broadens; Fed unlikely to hike despite rising energy—will rationalize cuts.
• JPM positioning and China silver exports (Christopher): If JPM flipped from short to long, they timed it well; China export curbs add to bullishness. New silver demand from solid-state batteries adds structural bid.
• Crisis magnitude and timing (Adrian Boysel): Timing uncertain (could be 2026–2028), but gold/silver surge is an early warning akin to subprime in 2007. Private markets: avoid high-multiple, hype sectors; favor solid cash generators.
• Gold–silver ratio (Cody): ~57:1; sees 50:1 as a reasonable medium-term target; 20:1 possible at speculative peak.
• Storage, capital controls, London/COMEX break (UK AI advisor): Schiff reiterated global inflation risk and favored offshore diversification and hard money; he pivoted back to current price action; no detailed operational guidance on a COMEX/LBMA failure scenario was provided.
• Miner valuation method (Barry on IAMGOLD): Look at reserves (ounces in ground), extraction costs, and implied cost per ounce in enterprise value; smaller names can be extreme (both under- and overvalued). Agnico Eagle still cheap vs its historical premium.
• Oil fundamentals (Josh): Expects oil to resolve divergence by rising; incremental energy demand from AI/data centers and mining is underappreciated.
• 401(k) action steps (Brand): See “Portfolio” above.
• Politics and candidacy (Orlando): Schiff thinks Trump’s policy mix and rhetoric risk discrediting market capitalism if crisis hits on his watch; would only consider running amid widespread acceptance of hard choices and with clear pro-market reforms.
• Hedge strategy for producers (July 9): Minimal revenue hedging to preserve upside; hedge inputs (energy) is sensible; short tenor hedges acceptable.
• Ethereum/tokenization (various): Acknowledges Ethereum has use cases but sees better risk/reward in miners; argues tokenization doesn’t inherently require blockchain; skeptical on current valuations.
• Exit tell (multiple): Sell-side models catching up, retail ubiquity in miners, and “priced to perfection” multiples would be Schiff’s sell signal.

Key numbers and claims cited

• Silver: Intraday above $79; +$7–7.4 on the day (+10%). Up ~$9 in a week.
• Gold: Above $4,500; +~$50 on the day.
• Platinum: >$2,400; ~+9% intraday.
• Palladium: ~+13% intraday.
• Copper: ~$5.85/lb; new ATH.
• Gold target: ~$5,000 by Q1 2026 (Schiff’s view).
• Silver target: ~$100 by Q1 2026; longer-term possibility ~$300 in an extended bull (framework, not near-term call).
• Gold–silver ratio: ~57:1; medium target ~50:1; speculative trough ~20:1 possible.
• MicroStrategy: 52‑week low ~$154 vs high ~$457 (as cited); avg BTC cost ~ $75k.
• BTC (Schiff’s 2025 framing during Space): ~−7% YTD; ~−40% from peak.

Bottom line

• Schiff frames the day’s rally as a confirmation of a multi-year thesis: a structural upcycle in precious and industrial metals fueled by policy errors, weakening USD reserve prestige, and chronic underinvestment in supply.
• He sees miners as the most mispriced expression of this thesis given un-updated analyst models, cheap energy inputs, and skepticism about price sustainability.
• He expects a stagflationary/dollar-credit crisis ahead (worse than 2008), with gold as the primary hedge; oil and copper follow on tightness. Crypto, in his view, is a speculative distraction that will hemorrhage capital back into real assets—particularly miners—starting Q1.