Transcription
Hello and welcome to BullionStar. I'm Claudia and today we're delighted to be joined by legendary investor and author Doug Casey. Doug is the best-selling author of Crisis Investing and the host host of Doug Casey's Take here on YouTube. Like so many of our viewers, I've been following Doug's work for so many years and I'm really looking forward to this conversation today. Doug, welcome and thank you very much for joining us.
>> Well, it's a pleasant it's a pleasure to be here with you although for me here is on the shores of the Chesapeake in Virginia in the US. Although I hasten to add I'm usually in either Argentina or Uruguay.
>> Great. Thank you so much, Doug. Well, this week marks BullionStar's 14th anniversary and it got us reflecting on just how much the precious metals markets have changed in that time. When we first opened, gold was well below $2,000 an ounce. Today it's $4,100. Central banks are buying aggressively and physical ownership has become much more mainstream. Doug, when you look back on the past decade or so, what stands out to you most about how the gold and silver markets have evolved?
>> Well, [clears throat] the fact of the matter is that I have been buying gold since the low 40s in 1971 and I've just bought it as an asset, sometimes as a great speculation, but always as an asset. At the moment, at around 4,000, 4,100, whatever it is, I think it's just reasonably priced relative to everything else out there in the world. Whether we're talking about meals, houses, cars, clothes, it's about where it seems [clears throat] to me where it kind of should be. So, it's no longer a good speculative asset, but even though I say that, if the US government were to for instance let's for instance take the debt that it officially owes which is about 40 trillion dollars and pay off that debt with the gold in Fort Knox which is said to be about 265 million ounces. Uh if they were to do that they'd have to reprice gold to about 150,000 dollars an ounce. Well, they're never going to pay off the debt and so forth but I'm not afraid of gold at 4,000. [clears throat] I think it's going higher. It's just not the kind of asset that it once was.
>> When you compare today's macro environment with previous eras, do you feel like we're entering one of those rare periods when maybe the financial political and monetary landscape are changing in a more fundamental way?
>> Oh, there's no question about that in my mind. The US has turned into from a a human republic which made it what it is today or was until recently and it's been transformed into a multicultural domestic empire and that's not a good thing for a lot of different reasons. So, still the US bestrides the world like a Colossus as Shakespeare said. But it's a Colossus with feet of clay at this point and since it's the center of the financial world as it staggers and I think it's about to fall for a lot of reasons. I've been a bear on the way the country's been going for a long time but I think [clears throat] we're getting to the edge of the precipice right now. So, I guess I'd answer your question by saying it's time to rig for rough weather more than ever.
>> Markets these days seem to just be moving as much on political developments as they do on economic ones and it would seem that wars, elections and trade disputes have become major market drivers. Do you think that we're entering a period where understanding politics is just as important as understanding economics.
>> Yeah, I do because it's very important as unstable as the world's financial and economic situation is to be solid and diversified financially and economically, but it's even more [clears throat] important, I'm sorry to say, to be diversified politically. In other words, that's something Russians found out in 1917 when the Bolsheviks took over. It's something the Germans found out in 1933, the Vietnamese found out in 1975, the Chinese in 1948. There's a whole list of Cubans in 1959. Politics, unfortunately, runs the world and therefore you have to be diversified politically. You shouldn't have all your assets in one country and you should have a crib outside of your home country. I understand that most people aren't in a position to do that from a personal point of financial point of view.
>> [sighs and gasps]
>> But if you're not, get yourself into that position while there's still time.
>> Well, I guess if the world's becoming more uncertain, as you're saying, um would that possibly explain why there's so much more interest in gold?
>> Yeah. The reason being that gold is the only financial asset that's not simultaneously somebody else's liability. That's really critical. There's no counterparty risk to gold. You don't have to trust anybody for gold. I could have the Bitcoin, which has been around for how many now? 13, 14 years. It's becoming a competitive asset because it shares, [snorts] to greater or lesser degrees, the five characteristics that Aristotle defined in the 4th century BC as what makes a good money. So, Bitcoin is also a potential of that will compete with gold And of course, silver is also a form of usable, reasonable money, but not as good as gold. So, um things are evolving and changing, but I remain a bull on gold. I'm not planning on selling any of my gold. In fact, when will I sell my gold? Well, it's a it's an asset. It's a security blanket. It's it's savings. It's money in its most basic form. So, why would I really want to liquidate cash, which is what gold is? I mean, sure, the US dollar is used from day to day and other currency, but the all these currencies issued by every [clears throat] government in the world, no exceptions. They're all fiat units. In other words, they're all paper units. They're all credit units issued by governments, and governments as entities are not to be trusted. So, yeah, I'm not planning on selling my gold anytime soon. I mean, maybe let's suppose uh Time or Newsweek uh magazines run a front cover showing a golden bear tearing apart the New York Stock Exchange. Well, okay, that might be a signal of a top, and I might lighten up a little bit and buy stocks at that point. But, uh not now. In fact, now is a very bad time to be in the stock market in the United States uh in any event. I mean, it's the most overpriced level in history. So, gold [clears throat] is no longer cheap, but uh the stock market in the US is at this [clears throat] point a genuine accident waiting to happen.
>> Interesting. Well, I'm going to go back to that in a little bit, but I do want to carry on talking about gold as a form of savings as opposed to speculation in your mind. What's interesting about gold being a form of savings and you know, you being sort of agnostic to its price performance so much because of that savings vehicle. I just want to point out that what's interesting about its performance is that over the past 5 years gold has also outperformed many of the assets people traditionally invest in like bonds and even the S&P 500. Naturally after a run like that, people you might expect, you know, demand to start slowing down, but we're actually seeing the opposite. Sort of according to the latest World Gold Council survey in June, nearly 90% of central banks are expecting global gold reserves to continue growing. So, if institu- if the institutions responsible for managing the world's currency are still buying gold, what do you think that they're saying that many private investors aren't?
>> Well, the central banks of the world, and of course [clears throat] they they come up with reports on what they're buying and selling. They do this type of thing. I don't think these things are necessarily to be trusted. Central banks and governments are notorious for lying or prevaricating or fudging. But still, all the indications are that most of the buying over the last few years has come from central banks, okay? It's not the retail public that's involved in gold at this time. The proof that the retail public is not yet involved in gold is the premiums on gold coins are very, very low. When the retail public's involved, they buy gold coins. And incidentally, I think gold coins are the best way to hold most gold. But the premiums on [clears throat] the coins are very low, which says that there's not a lot of buying from the public. It's been central banks. Now, why is this? Like the Chinese in particular, the central banks have to have assets, and in the past, the major asset has been the US dollar. But the Chinese are not stupid, and they realize that holding the fiat asset of an adversary [clears throat] is dangerous at holding those dollars. How how fast are the dollars in the world, US dollars, losing value? I'd say 5%, maybe 10% per year. I don't believe the government figures anymore. The US government figures much more than I believe the figure government figures of Argentina when they give their inflation figures. They're fudged. They're They're made up. They're arbitrary. So, central banks of the world have been buying gold. I don't think central bankers are necessarily very smart, but I think it is smart what they're doing, dumping fiat currency from a bankrupt issuer and trading it for gold, which has been money throughout history. And I'm of the opinion that gold will again uh in the >> [clears throat] >> years to come, not too long, be used as money again as it was before 1933 throughout the world. Question is this, what's the price of gold going to be or what will the buying power of gold be relative to other things in the world? That's the question. And [clears throat] if gold is going to be reinstituted as money, well, let's figure this out. How many ounces of gold are there in the world above ground at this time? Well, nobody knows exactly, but the best guess is about 7 billion ounces. Well, more or less 1 oz for every person, man, woman, and child in the world. Uh and the amount of gold in the world is growing by about uh one a small fraction percent per year. So, yeah, I think that gold will have to go up in price if it's going to be used as money, and it will be used as money because really nobody trusts their fiat currencies, and the central bankers of the world absolutely don't trust each other. So, what are they going to use for an asset to trade? Well, gold.
>> I know you don't like price predictions, Doug, so I'm I'm not going to ask you in such a way of giving me some sort of lofty price prediction on gold, but realistically, if gold were to become money, what do you think it needs to be priced at to be money?
>> Well, we just have to kind of do the numbers. And taking a look at the US, who say they have 265 million oz in the Treasury. Of course, there hasn't been an audit for many decades, so we're not sure how much they really have. And [clears throat] we do know that not much of that is good delivery gold, .999 in 400-oz bars. It's apparently mostly coin melt from when Roosevelt confiscated Americans' gold in the '30s. Okay, so if we do some number crunching, how many dollars are there in the world? They Look, the Fed doesn't really even know how many dollars there are in the world. They don't even have a good definition of things like M1 and M3. How many dollars are there, for instance, outside the US, held by foreigners? Because you got to remember, Americans have to use dollars to buy and sell things. That's the law. That's what legal tender is all about. But if you're not an American, if you're outside the US, you don't have to use dollars. So, how many dollars And And those dollars outside the US, uh generally called eurodollars, are a liability of the Treasury that right now they're trading outside the US, all these dollars. Because the US has been running a billion-dollar or so trade deficit per year for decades, well, since the early 1980s, actually. So, how many dollars are outside the US? Well, nobody knows. It's probably something on the order of 30 or 40 trillion. The numbers are huge. I mean, backward people count in terms of two, three, many. And we've got so many zeros in back of things now. It's like it's like we're living in Zimbabwe. So, in answer to the question is to make the just the foreign out of the US dollars redeemable, uh how many times does 265 million the number of ounces go into trillions and trillions of dollars? And of course, there are a thousand billions in every trillion. It's a it's a big number. Uh I hesitate to say anything except I'm very comfortable with gold now at four 4,000. Like not not necessarily a great speculation. But the primary trend is still up. Unlike unlike the primary trend for the bond market, which is much bigger than the gold market or the stock market. It peaked in about 2022 when interest rates went to basically zero. It actually [clears throat] unbelievably went to negative numbers, which I thought was metaphysically impossible to have negative interest rates traded securities, but it happened. So, [clears throat] we've been in a bear market for bonds, which is the biggest market out there for the last 4 years. And I think it's going to get much, much worse. I think we're going to see interest rates, as unbelievable as it sounds, and we can talk about why it sounds unbelievable. I think they're going to head back to the level of the early '80s when the US government was paying 15, 16, 18% for our our money. It could happen again. I think it will happen again. Yeah, gold's going to become money again. That's right, because people >> it always has been money, but in the financial system >> right, but in day-to-day use because people don't trust paper money. And they're going to [clears throat] trust it less as all the governments of the world, almost all of them, are running big deficits, which they cover by inflating their currency, printing up more of it. So, and they painted [clears throat] themselves into a corner at this point. And and the US, you know, has gotten itself involved into a couple of big wars. War is bad as things were before. Running two trillion dollar per year deficits. Uh we're looking now I think two and a half three trillion dollar deficits. Uh where are they going to get the money? By printing it up. So anyway it's a gloomy it's a gloomy it's a gloomy picture.
>> Well, I want to get your thoughts on one of the biggest developments in precious metals coming tomorrow on the 24th of July and whether that's possibly a tiptoe towards gold returning to the financial system. Maybe not immediately but maybe down the track and that is with China shutting down leverage gold and silver trading for retail investors through its banks. What's interesting is that investors can still buy fully paid physical bullion. It's only the leveraged paper products that are disappearing. Do you think that simply sensible risk management in light of the price correction in gold this year or do you think it might be forming part of China's longer term strategy to accumulate physical gold, reduce reliance on the US dollar, and strengthen its influence over the global gold market?
>> Well, I think the Chinese people and [clears throat] actually the Chinese government are to be complimented for their attitudes towards gold because when I've been to China I see gold shops everywhere. Make it easy for the average citizen to buy gold. That's great and the Chinese government seems to support that. I mean they know that one of the main one of the main reasons that Chiang Kai-shek fell in in 1948 was because he destroyed the currency and the Chinese the current Chinese government doesn't want to see that happen again. So yeah, they're very favorable towards gold but uh I don't like to see and I don't think [clears throat] any economist should want to see any government intervention in the society. So if the Chinese government is saying you can't buy gold on leverage whatever, that's a I don't think it's prudent to buy gold on leverage, so not arguing with whoever is making that decision, but it's a bad decision because it's intervening [clears throat] in the economy and the free choice of individual citizens.
>> So, in your opinion, freedom is more important than the underlying, I guess, principle there.
>> Yeah, because gold is all about individual freedom. It's It's an asset that's private. Uh it can't be monitored the way your fiat bank account or brokerage account could be monitored. So, uh that's the whole point of gold. It represents personal freedom. You can take it with you or, you know, it's something that if we have CBDCs, central bank digital currencies, which they're trying to do, then you can forget about freedom because if they don't like you, they can simply block your account like any other computer account. Like Visa can block your account if they don't like you or your bank can debank you if they don't like you. That's That's the nice thing about physical gold in your own possession.
>> Yeah. One of the other remarkable developments in precious metals over the last couple of years that I wanted to talk to you about as well is is the fact that Tether, a private company, has become one of the world's largest private holders of gold and it's now holding around 154 tons. In the last 2 years, it's bought 73 tons of gold, which is more than China has in that same period. So, what do you make of a private company accumulating gold on that scale? Does it tell us something about where the monetary system is heading?
>> I think it does. And it also tells me that the guys that run Tether are pretty smart doing that. And it's not only, incidentally, that they are buying gold, the metal, but they're buying gold mining stocks in addition, ETFs and royalty companies. So, it's not just gold the but the producers of gold as well. And one thing that you said, you were talking in terms of tons. And this is a meme that started about, I don't know, 10 years ago. Previously, everybody talked about gold in terms of ounces. Why ounces? That's the traditional matter measure when you [clears throat] mine when gold is mined, it's not you don't mine mine tons [clears throat] of gold. It's about 31,000 oz. You mine it by the ounce. When you use it by the ounce. When it's priced, it's priced by the ounce. So, why have things become confused with tons? Not only [clears throat] do a lot of people confuse uh English tons with metric tons, which is about a 10% distance, but most people don't know how many ounces there are in a ton. So, it makes the whole gold situation like academic. Therefore, I whenever anybody mentions tons, I always give this little spiel. I just said, "No, we should use ounces." Unless [snorts] the world entirely goes metric, then gold is priced by the gram. Well, at that point, okay, that's different, but that's not the world we live in right now. Just had to say that.
>> [laughter]
>> Not at all. Thank you. Um and so, do you think that would suggest, obviously with Tether buying, that other private corporations might start following suit, copying their lead?
>> Yeah, I do as a matter of fact. And one of the biggest dealers in gold, I think in the future will not be Tether, but will be gold mining companies. One of the dumbest things going on is that mining companies who are coining money now, incidentally, with all [snorts] in sustaining costs of mining an ounce of gold industry-wide something around $1,700. So, if gold is 4,000, a company that's mining is making a lot of money, but it's really rather stupid when gold mining companies say they believe in their product and everybody ought to own gold. But, what do they do? They take the gold and they sell it for dollars. So, they have the solution to uh the monetary problem and they're trading it for fiat dollars. I mean, gold [clears throat] companies should keep their product on their books as gold instead of trading it for dollars. And I think that's probably going to change in the future. And uh talking about gold mining companies, they're very, very cheap right now relative to all other stocks. In fact, relative in relative terms, gold mining companies are actually about the cheapest level in history. They've run up a lot, of course, in the last couple of years, but not nearly, remotely what you would have expected in the past. So, I am very, very bullish on mining companies at this point. I treat gold as an asset for savings. I treat the mining companies as [snorts] things to speculate with. They're really cheapest class of stocks in the world. And this is true of all commodities, all across the board. They're all cheap. Agricultural commodities, energy commodities, everything. Commodity complex is really cheap right now.
>> Well, one thing one thing we're noticing in conversations with investors around the world is that there's a theme in our conversations which has evolved over the last couple of years. People aren't just asking, "Should I own gold?" They're actually often asking, "Where should I own gold?" Singapore has become one of the places people are looking at because of its reputation for political stability, the rule of law, and respect for private property. But, do you think we're entering a world where jurisdiction is becoming almost as important as asset allocation when it comes to preserving wealth?
>> Yeah, I do. I think that you ought to have gold coins, significant number, in your own possession. And silver coins, too, for that matter. But, uh as I said before, you've got to diversify politically. So, an American or a Canadian or a European should store some [snorts] of his gold outside of his home country. And Singapore is as far as I say you guys are one of the three best jurisdictions in the world to store gold. I'd say Singapore, Switzerland, which is traditional, but not as good as [clears throat] it used to be. And the Cayman Islands would be the third. Absolutely though, you're quite correct. So, you're you're in one of the best places in the world for that purpose.
>> Yeah, we've been noticing a great uptick in interest in customers who are looking to shift their investments and portfolios and and holdings to Singapore. So, it's been a very interesting time over the last few years and we only expect it to grow.
>> I used to live in Hong Kong. Now, Hong Kong is not what it used to be for that purpose. Although, it used to be fine. Now, no longer. Singapore is the place to be in the Orient, no question about that.
>> It sure is. Doug, the other observation we've noticed in the precious metals market in more recent times is, for example, from January to June in this year, we have sold about 60% as much silver as we have gold, which has been a noticeable increase from last year. And it would suggest investors maybe thinking differently about silver than they were just a year or two ago. In your opinion, how do you think investors should be thinking about the role that each metal plays today?
>> Well, they're both monetary metals. They always have been and I think they always will be. But silver is increasingly a uh an industrial metal. Now, is that good or bad? It means that there's going to be a lot more demand in the future for electronics because as everybody I'm sure knows, silver is the most reflective of light and the most conductive of both heat and electricity of all of the metals. So, that makes it rather unique in the physical world. And in a the high-tech world we live in, you know, use of silver is going to go up up up. Uh and at the same time, uh silver is So, you say, "Okay, price of silver goes to $100 or $200 an ounce. Let's just buy more." It's not quite that simple because about uh 70% of all the silver in the world is a byproduct of generally lead, zinc, and copper mining. So, you're not going to have ramp up the mines because of a minor subsidiary metal. So, the supply is kind of level and fixed, but the demand is going up. That's reflected in this current price. Yeah, I'm I'm actually pretty bullish on silver uh at this point. More than actually more than gold, truth be told, as a speculation.
>> So, are you buying silver at the moment, or do you plan to?
>> I'll tell you what I'm actually doing. I like to sell puts against options in the commodity market on some commodity sometime. Capture the premium because when you sell options, in case of silver selling puts, you don't have to be really right. You just have to not [clears throat] be really wrong. And you're acting as an insurance company. You're acting as a casino as opposed to the gambler. Anyway, that's another another story. But if you're in a position to, I'd suggest that and you have to be well capitalized to do this. I like selling options against silver and for that matter gold. If it goes down a little bit, okay, fine. Take Well, but I'm not going to take delivery of the silver. I'm I'm not interested in holding 5,000 oz of silver bullion delivered to my front doorstep. That's not going to work.
>> We can store it for you in Singapore, Doug.
>> Well, that's that's that's that's a good point.
>> [laughter] [gasps]
>> You mentioned earlier, sorry, go ahead.
>> I mean, I I feel very comfortable owning 5,000 oz. That's about $60 an ounce. So, that's 5,050. That's about 300,000 oz of dollars worth of silver. Yeah, but that sounds good. Anyway, go ahead. [clears throat]
>> We have a very large, amazing James Bond style vault at at Freeport in Singapore. If you're interested, we can talk.
>> There's room There's room for that There's room for that much more silver, right?
>> There's plenty of room. Um you mentioned earlier, I just want to actually ask you about this. You mentioned you prefer gold coins um I'm presuming to gold bars as a as a form of investment for your physical gold. For investors who do prefer physical metal uh you know, and prefer to purchase a physical silver, do you have a preference between uh bars and coins for silver?
>> Well, you know what? A $60 silver just a a silver 1-oz round is actually worth something. You can't pass them out as as party favors anymore 60 bucks plus premium piece. I'm inclined towards the coins, frankly, cuz I'm not an institution. I'm an individual. And uh I think most of the people listening are. They're fungible. They're recognizable. Uh you don't have to fear really that it's something other than silver. I mean, look, people say, "Oh, do I have to worry about a gold bar being tungsten, which has the same specific gravity as gold and therefore can be mistaken for if there's a gold seam put on top of No, I'm a believer in silver coins. And which silver coins do I like? Um I prefer the ones that are .999. So, what does that tell me? My first choice for buying silver coins is um probably Canadian Maple Leafs, which are the most widely traded pure gold and silver coins. Or if you're buying if you're buying uh I don't think you can go wrong buying US double Eagles either because [clears throat] they have a certain numismatic value. They're well recognized and British sovereigns would be a third coin that very fungible, very liquid, very recognizable.
>> Do you like the Australian ones as well?
>> [snorts]
>> Yeah, cuz they're they're also 999 the kangaroos, aren't they? But they're not as widely circulated as the Canadian as are as recognizable, but I actually own some of the kangaroos. I also own some Chinese pandas too, believe it or not and I believe they're also 999.
>> Now Doug, I've brought along a prop today. You've previously said that inflation is likely to be much higher in 5 years from now. I remember hearing you say that you carry one of these in your wallet, so I thought I'd show the one I always keep on my desk to remind me of what can happen when confidence in a currency is lost. What warning does this note carry for you?
>> Well, you're holding a 100 trillion dollar Zimbabwe bill I'm pretty familiar with that bill cuz I've spent a lot of time in Zimbabwe, a lot of time actually starting in the days when it was Rhodesia way back when, which I don't know how many people even remember that. And the last time I was in Zimbabwe, I spent a lot of time with Gideon Gono who was the uh head [clears throat] of the Zim Central Bank and if you look at that note that you have there, you will see Gideon Gono's signature. Uh
>> Okay.
>> lower the lower left corner of it. Yeah, see if I can make it out. Anyway, his signature's there. Anyway, it's interesting because you think, well, Gideon Gono who [clears throat] was the head of the Central Bank then signed that note, he must be a blithering idiot. Fact is, he was a very smart guy and he gave me a paper that he wrote that was addressed to Robert Mugabe who was the president of the country, criminal at that time, but that's another story. Saying Zimbabwe should have a gold dollar. So, it's it's rather This is an interesting fact that most people are unfamiliar with. The guy that printed the hundred trillion dollar bill wanted to do a gold Zimbabwe dollar. And I do keep one in my wallet. You're quite correct.
>> And do I keep it to remind you of the dangers when confidence in a currency is lost?
>> It's a great conversation [clears throat] piece. And when I was in Zimbabwe the last time, I had a couple of these um privately minted gold certs. One of them is made out of plastic and has a certain amount of gold that are a fraction of a gram. And another one has a little piece. Anyway, so I I showed one to the Secretary of the Treasury of Zimbabwe at that time. I said, "Take a look at this. This is what you guys should be doing." And he took it. He confiscated it from me. You know. [laughter] So, he got the idea, but I don't know I don't know if I have high hopes for the future of Zimbabwe. Probably not.
>> Doug, a lot of people would look at this note and say that could never happen in a developed country. Do you think that's complacency or
>> Yeah, it is complacency because the US government has painted itself into a corner. If you look at what they spend money on, most of the US government's budget is for welfare. Welfare, what do you mean? Social Security, Medicare, [clears throat] Medicaid. And that's most of the budget right there. And the other the two other big items are interest and military spending. And all the military spending is going to go up. It's uh for the first time, interest [clears throat] is more than any other thing in the budget, including the military spending. So, those things have to be done. I mean, the way the world is currently structured. And where they going going cut? Nobody, you know, the American public is so inured to free freebies from the government, social security, Medicaid, Medicare, and lots of other programs which go into that box, they can't cut them because you can't break the people's rice bowl now that they started to rely on it. So, all they can do is print up more. And spending is going up. It's not being cut. It was nice when Elon Musk came up with the idea of dodge and, you know, slash and hack everything. No, budget's going up radically every year. So, they're going to be printing up more money. And the the dollar is going to lose value. Who owns own dollars? Look, I don't know if you saw this uh that um some newsletter writer, I don't know who it was, took a basket of 28 items, I think, from Target. Uh potato chips and common, well-known brands of stuff. And these 28 items in a basket cost like $68 in the year 2000. Now, they cost about $165. I mean, that's shocking. I mean, we're not talking about 2% inflation, which is the the Fed's target, which is ridiculous. Zero ought to be the target, not 2%. But, uh that's what's happening to the dollar, and it's going to continue.
>> One thing that caught my attention from a recent interview you gave was a little surprise where you said you're actually holding more cash today, and at first glance, that would seem surprising given your concerns about debt and currency debasement. And I'm just wondering what's your thinking behind holding more cash at the moment.
>> Well, I don't have any debt except the mortgage on it, this house I'm in here in the US. And I view that as an asset, not a liability. Why? It's a 30-year mortgage at 3 and 1/4%. And I consider that it's not a liability, it's an asset because the dollar is being inflated at two at least twice what that is, and so I don't even count that. But, um and I think that gold stocks, which have gone down about 30% since their peak in >> [clears throat] >> January or February, so I'm buying them again right now, but you know, you want a little bit of liquidity because if I find a bargain, I don't want [clears throat] to have to sell something at perhaps an inopportune moment to buy the bargain I see. So, you got to keep a little bit of cash around. So, that's okay. Yeah, you're losing 5 or 10% on your cash per year. You are. And in fact, you're actually net wealth is going down by 5 or 10% per year unless it's going up in nominal terms. Your house, your car, your stock portfolio, unless it's going up by at least 5% per year at the moment, you're getting poorer every year. So, I don't mind holding some cash for the flexibility because the [clears throat] average guy doesn't still doesn't know what gold is and won't take it in payment if I want to buy something. So, yeah, I I'm fine with holding some cash under those circumstances.
>> And does having your gold as savings give you the sleep at night comfort that you don't mind holding that much cash?
>> Yeah, there was there was Listen, there was an old saying, the Swiss said this, of course, it's good to have gold, but it must [clears throat] also be in Switzerland. That's not so true anymore cuz Switzerland is not what it used to be. But, yeah, I feel much better having gold both with me and in some safe place outside of my political jurisdiction where I am, where the government can't can't easily get its hands on it. At least the US government can't.
>> Yeah, wise words. Doug, before we finish, I want to step away from the markets and talk about some of the broader lessons you've learned from decades of investing, traveling, and studying history. One theme that comes strongly through your work is the importance of independent thinking, not just investing, but in life. Why do so many people struggle to think independently, particularly when it comes to money investing, in your opinion?
>> Well, one reason, and there are [clears throat] others, is bad education. And people think you know, in the United States, half, roughly, of high school graduates go off to college. And this is one of the most stupid things that a young person can do. Because when you go off to college today, you're jumping into a cesspool of bad ideas. So, what I've done with [clears throat] a couple of friends, answering your question, is I recently wrote this book called The Preparation, which explains the reasons why you should avoid college like a poison today. Unless you want to you need the lab work and the formal discipline for science, technology, engineering, math. Okay, that's fine. College is great for that. But in addition to learning all the things that academically you should learn in college, but people don't cuz they're too busy chasing the opposite sex and drinking beer. I mean, that's just a fact. Uh but we have that covered here. Uh we've divided the year or the excuse me, the four years of college into 16 quarters. And in each quarter, you learn to do something practical and outside so that you can transform yourself into a Renaissance man. Learn to sail a ship around Cape Horn. Learn to drive heavy machinery. Go to Thailand and study martial arts for 3 months. Uh uh go to Italy and learn to become a competent chef. I mean, not because you want to be Gordon Ramsay or Wolfgang Puck, but because these are the more you know and the more experiences you have, the more capable you are of landing on your feet. So, I think everybody should buy this book. I'm hawking it not because there's any money in books, there's not, not unless you're Stephen King. Uh but because young people today are going off to college and then [clears throat] they got out of college, they're burdened with a giant debt and they have totally misallocated worse, they've wasted the four best years of their life. They should be doing the things we suggest in this book. So, answer your question, why are things going downhill? A great part of it is because of the educational system in the world, not just the US, which has been totally corrupted, taken over by leftists and Marxists and woksters who are corrupting the youth. You go to college and you expect your teachers to tell you the truth. Well, that's a lie. So, anyway, that's why we wrote the book.
>> Sounds fantastic and I will be buying it for all the young men that I know cuz I completely agree with you, Doug. And you've in fact challenged conventional thinking for decades and I think that's one of the reasons so many people enjoy following your work. Uh apart from your amazing new book, um where else can people keep up with what you're writing and producing?
>> Well, I have a blog called internationalman.com. There's one thing I've done is done a lot of traveling in my life. I think I've been to 155 countries and lived in 10. Yeah, so I'd go to internationalman.com, it's free. We have really good articles, really good, if I do say so myself. And I have a a podcast with my partner Matt Smith and [clears throat] uh it's on YouTube and we have a paid newsletter with stock recommendations, which are all of the resource nature today called crisisinvesting.com. And uh we have another service which is free where we interview mining companies where 12 experts, geologists and analysts take apart a company with the management there and determine whether it's good or bad. It's called the expertsroundtable.com. So I guess that's what I'm doing to I don't know if I'm keeping out of trouble but to keep busy anyway.
>> It sounds like you're a very busy man Doug. You're not slowing down. Doug thank you for your time so much. It's been amazing today. It's been such a pleasure speaking with you and we really appreciate your sharing your thoughts and experience with our audience and I'm sure they're going to find plenty to think about after today's discussion.
>> Well thank you Claudia. I appreciate that.
>> To everyone watching thanks for tuning in. Don't forget to like, share and subscribe for more conversations with some of the world's most insightful voices in precious metals and if you'd like to receive 5 grams of silver for free you can find our sign up link in the notes below. I'm Claudia from BullionStar and I look forward to seeing you next time.
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