Most Bitcoin enthusiasts will never see eye-to-eye with Peter Schiff. Saying that this sentiment is mutual would be quite an understatement. Now is a good time to look at Schiff’s three safe havens, and how they performed in 2020.
The Safe Havens of Peter Schiff
For someone who is always negatively outspoken on Bitcoin, traditional markets often remain of great value. In the case of Peter Schfif, that statement holds a lot of truth. He isn’t remotely interested in crypto assets or most innovative investments of the past decade. Instead, he focuses on his own collection of safe havens. All of these assets often gain value slowly, yielding more than respectable profits.
To put this into perspective, Schiff pays focus to three key assets. First of all, there is a gold, which won’t surprise anyone. Secondly, he pays close attention to US treasuries, which is always a bit of a risk. Last but not least, he greatly vales the US Dollar. Now is a good time to determine how all three safe havens have performed in the first half of 2020.
US Treasuries (10Y)
It is unclear which US Treasuries Peter Schfif pays attention to. Knowing his approach to longer-term investments, looking at the US10Y chart should provide ample information. Treasuries haven’t been overly stable in 2020, primarily due to the coronavirus and looming inflation concerns.
Looking at the chart above, it doesn’t look like a great investment in 2020. The start of the year was more than decent, but things fell apart rather quickly. Following stimulus packages issued by the Fed, there hasn’t been any real improvement for the US10Y. In fact, it seems to be going even lower than the current 0.68% yield it provides today. Not a great investment, and certainly not a safe haven, even if Peter Schiff feels differently.
The US Dollar
When concerns over inflation take shape, a national currency will often perform rather weakly. In the case of the US Dollar, it dictates the pace for the world’s monetary system. If the Dollar falls apart, the damage may be irreparable. Determining the performance of the US Dollar can be gauged by looking at the DXY.
Considering how the Dollar Index needs to be as high as possible, 2020 has been incredibly volatile. An initial dip was overcome and followed up by a major spike in March of 2020. Ever since then, the uptrend has fallen apart a bit. Currently, the DXY sits at 97.5, which is fairly healthy.
Comparing the USD to other fiat currencies, there is a bit more positive news. The Dollar gained on the Euro, New Zealand Dollar, Pound Sterling, Australian Dollar, and Chinese Yuan with ease. However, it has lost ground compared to the Swiss Franc, Hong Kong Dollar, and Japanese Yen. Keeping an eye on these relationships will prove interesting for Peter Schiff during the second half of 2020.
A lot of people have made good money by investing in or holding onto their gold. The year 2020 has yielded volatility in this market as well. However, gold rebounds very quickly, and shows no signs of slowing down. A price push to $1,800 an ounce in the short-term remains very likely. Some analysts even expect gold to reach $3,000 per ounce by late 2021.
Overcoming the big dip in March 2020 is crucial to this success. Similar to other markets, gold has lost a lot of value during a few volatile days. Ever since, the uptrend has been very strong, despite meeting minor resistance along the way.
Contrary to what Bitcoin enthusiasts may expect, gold performed well against BTC as well. The internal ratio between both assets has shifted in favor of gold over the past few months. Although Bitcoin is still worth more, it will be interesting to see what the ratio looks like by late December.
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