by Peter Schiff, Schiff Gold:
With CPI data once again coming in hotter than expected, it’s getting harder and harder for the mainstream to swallow the “transitory inflation” narrative.
And some people are starting to worry.
During an earnings call, JPMorgan Chase CEO Jamie Dimon expressed concerns about higher than expected and persistent inflation ahead.
Dimon told analysts and investors that year-over-year inflationary readings under 4% are “unlikely” over the next six months.
We prepare for probabilities and eventualities. And one of those probabilities is that [inflation] might go higher than people think.”
In fact, the yearly reading has been above 5% for five straight months, and if you annualized the inflation rate through the first three quarters, you come out with a 6% inflation rate.
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The mainstream narrative has been that the Fed will step in and tighten monetary policy to fight inflation. This is why we’ve seen a selloff in gold every time we get hotter than expected CPI data. But reading between the lines, Dimon seems skeptical that the Fed will move quickly, saying that he doubts the central bank will raise rates “before late 2022.”
Peter Schiff has said for months that he doubts the Fed will enter the ring to fight inflation. And if it does, it will quickly surrender. He reiterated this point in a podcast after the release of the September CPI data.
If it even tried, it would have to surrender. It would lose. It’s probably just not even going to enter the ring. And inflation will just win the fight by default.”
If other mainstream figures such as Dimon are starting to see the inflation writing on the wall, it could be good news for gold and silver.
Precious metals have been pounded in recent months as investors have anticipated Federal Reserve monetary tightening. With every uptick in CPI, gold has sold off. But after the September data was released, the script changed. After an initial sell0ff, gold rallied. Schiff said this could be a sign the mainstream is coming to grips with reality.
I think the fact that you know saw traders buying the dip on worse than expected inflation news maybe means this fantasy that bad inflation numbers are also bad for gold is now over. Maybe investors are realizing that bad news on inflation is actually good news for gold.”