The price is down about 11 percent in 2015 and nearly 45 percent from its September 2011 nominal peak. Commodity prices are collapsing around the globe amid an economic slowdown. The Federal Reserve, meanwhile, is expected to raise interest rates shortly, seemingly striking another blow against the gold trade.
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Don't tell that to the bugs.
The U.S. Mint said it sold 97,000 ounces of American Eagle gold coins in November, marking a 185 percent monthly jump and a 62 percent gain from the same period in 2014, Reuters reported. Silver coin demand also surged and already has broken the record it set last year.
The move is likely to result in washing out some of the weaker-conviction owners who have gold through exchange-traded funds — the most popular is the SPDR Gold Trust — and the rush in by those with higher conviction who are more likely to hold the actual metal.
"The demand is there. It's growing. It's even greater outside the U.S. than domestically," Schiff said of physical gold. "The reality is that there's never been a better time where people should be buying gold than now. Currencies are being intentionally and deliberately debased around the globe, interest rates are at absurdly low levels and likely to stay there for the indefinite future."
Schiff doesn't buy the narrative that the U.S. economy is improving and that the Fed is just beginning a tightening cycle. Instead, he expects the central bank to have to reverse course and eventually start "printing money" again through quantitative easing to boost growth.
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If nothing else, there certainly seem to be some crosscurrents playing out in the markets.
"Gold is essentially a protest vote against central bank-backed currencies, only no one seems to be waving placards or chanting slogan," Nick Colas, chief market strategist at Convergex, said in a note. "Perhaps a stronger dollar is to blame (gold is priced globally in greenbacks), or a slumping Chinese economy is tamping down consumer demand. Either way, if the Fed really were about to make a serious policy mistake, we'd expect to see gold trade at least a little more robustly."
Some got scared off gold when Mario Draghi, the European Central Bank's president, made a speech last week in which he promised to continue to try to promote euro zone inflation. The thinking is that a deflated euro would pump up the dollar and hammer gold prices.
Don't fall for it, said economist and gold advocate Michael Pento, founder of Pento Portfolio Strategies.
"Draghi's efforts to crush the euro have somehow been taken by Wall Street as a great opportunity to sell gold. But there shouldn't be a person alive having an IQ greater than a mentally challenged ameba that can rationalize why it is appropriate to sell gold simply because of Mario Draghi's obsession with creating inflation and destroying the euro," Pento wrote.
Investors should focus less on the euro-dollar relationship and more on the value of the greenback itself, which is being eroded by slow growth, low real interest rates regardless of the Fed's intentions and the growth of the U.S. money supply, which is far outstripping economic gains, Pento said.
"Once it becomes clear that the economies of Europe and the United States are not that different, the ECB and Fed will have similar monetary policies," he added. "When that happens the U.S. dollar will rollover against the euro and send Wall Street scrambling back into gold ETFs, as the intrinsic value of the dollar takes a dramatic step lower."
As conviction of the real gold buyers like Schiff and Pento intensify, then, it's probably logical that the move toward physical gold and away from paper gold — think ETFs or gold miners — would intensify.
Gold bugs have long been skeptical of the funds in particular in that some employ derivatives. As the website Advantage Gold explains: "Simply put, ETFs don't insulate you from the risks inherent in the financial system. Although they can be useful to high-frequency traders they are no substitute for owning physical gold and silver."