Every Other Asset Is Overvalued: Buy Metals Now

In an interview on December 30, 2015, Doug Casey, founder of Casey Research, argued that every other financial asset is overpriced, leaving gold and silver as the only viable assets to buy.

Casey said, “Gold and commodities in general have been in. . .a very serious bear market for years.” When asked when it would end, Casey said, “It’s impossible to pick a bottom to these things, but the lower something goes, the closer we are to the bottom.”

Casey believes that gold is a vehicle for savings, so he continues to buy gold. He asked, “Where else are you going to put your money today?”

He offered a bleak view of the future. In a zero-interest rate environment, he believes that governments are asking for an “all-out catastrophic credit collapse.”

Turning to mining stocks, Casey said, “I’ve been calling for a super-bubble in the mining stocks as soon as gold takes off, which I think it will. I’ve been saying for years that mining is the worst business in the world. . .It’s a nineteenth century choo-choo train business that is eventually going to radically change its entire nature.” Even so, he believes that mining is cyclical, so it will turn around. He said, “I hope this is the year” for a turnaround.

With gold down roughly 10% in 2015, Casey said central banks in Russia and China and other places in the Orient are buying gold rapidly with their dollars. He asked, “Who wants to hold dollars at this point, when you’re charged money to keep the dollars and the dollar itself is nothing but a floating abstraction, which eventually is going to reach its intrinsic value of approximately zero. It’s gloomy, it’s grim right now for gold, but there’s no other place to be. The stock market is grossly overpriced. Bonds are in a historic super-bubble. Real estate in all the major cities in the world is in a bubble. I don’t know where you can go right now” other than gold.

“If it’s not the bottom,” Casey said, “it’s close enough to the bottom” for gold. “I have to be an aggressive buyer of gold and silver because, and I’ll repeat this, there are no other alternatives. Remember, gold is the only financial asset that isn’t simultaneously somebody else’s liability. Everything else in the financial world is grossly overpriced, including the dollar itself. So, yeah, I have to buy gold.”

Turning to the US presidential election, Casey said, “All of these people are horrible; every one,” with the possible exception of Rand Paul. He said Hillary Clinton “is even worse.” He warned that “This time next year, I expect the economy to be well back into the greater depression.” He lives in Buenos Aires and said, regardless of who is elected, “I feel much better here in Argentina, than in the US.”

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