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Breandan/Zeph,
I've been trying to find out more about Schiff's fund performance. I can't find any credible public information. Do you know where I can look it up? What kind of return has he produced in 2008?
This for example, is not Schiffs fund as far as I can tell:
http://finance.google.com/finance?q=NASDAQ%3AAEPGX
"Hamilton is really a Colossus to the anti republican party. Without numbers he is an host within himself. They have got themselves into a defile where they might be finished but too much security on the republican part will give time to his talents and indefatigableness to extricate them. We have had only middling performances to oppose to him. In truth when he comes forward there is nobody but yourself who can meet him. His adversaries having begun the attack he has the advantage of answering them and remains unanswered himself. For God's sake take up your pen and give a fundamental reply to Curtius and Camillas" - Thomas Jefferson to James Madison
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Schiff doesnt run a fund, he runs a brokerage house that invests primarily in non-U.S. stocks and commidities. He's big on taking your money, converting it out of dollars, and investing it overseas. He usually only invests in stocks that pay out dividends too. That site that I linked is his brokerage.
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I see. So there is nothing that we can use to judge his performnce I guess? I see his site: http://www.europac.net/ but I can't find anything about his performance there. All I can find are forum posts where people talk about losing 30-40% in 2008 in the accounts they have with him (which I can neither confirm nor deny).
What I'm really looking for, is a reason to beleive this guy is different from anyone else. If he called the housing bubble, did he profit from it? Did he put his money where his mouth was or did he just put his money outside the US and lose the same if not more then the average investor lost in 2008?
Don't take this as an attack on the guy, as I've said before, I agree with 90% of his statements when it comes to investing and savings trumping consumption etc. I just really want to see some results. For example I've studied Buffet for 5 years now. That study, in combination with his outstanding results over a 40 year period (22% annual return) gives me great confidence in the guy. I want to decide if I should have confidence in Schiff or not.
"Hamilton is really a Colossus to the anti republican party. Without numbers he is an host within himself. They have got themselves into a defile where they might be finished but too much security on the republican part will give time to his talents and indefatigableness to extricate them. We have had only middling performances to oppose to him. In truth when he comes forward there is nobody but yourself who can meet him. His adversaries having begun the attack he has the advantage of answering them and remains unanswered himself. For God's sake take up your pen and give a fundamental reply to Curtius and Camillas" - Thomas Jefferson to James Madison
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Well there's no true way to judge his performance, because it's different on a client by client basis.
He has said that no one was immune to the collapse, foreign stocks took a huge hit, and some agriculture. He has also admitted that he expected the dollar to crash a lot more than it did during the crisis.
Im pretty sure he stays away from oil as it's too volatile. He's a big gold lover tho, which has done well. And he doesnt deal in dollars, so the huge dollar decline the past 2 years wouldnt affect one's portfolio.
It's generally a matter of how long youve been with him. An ounce of gold in 2000 cost $265, it's $750ish now. Think of the enormous run ups of the foreign markets, in the early-mid 2000s, he was there for the feast. The people complaining now that they are losing 30-40% were making 30-40% returns in Asian markets in 2003-2004. He has always said, if you price the U.S. market in gold, it's down considerably even during the boom.
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Another thing to keep in mind is that some stocks he advocates to his clients right now are paying very large dividends. Why does this matter?
Well one he talked about on a show he was on had the stock price so depressed that the dividend payed 30% of the stock price. Thus in 3 years even if the stock goes down in value you have already gotten your money back in the stock.
Its a way to earn "rent" on your money. Thus even if my portfolio were to drop 40% I still get my X dollars a year from dividends.
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Zephyrs Wrote:Another thing to keep in mind is that some stocks he advocates to his clients right now are paying very large dividends. Why does this matter?
Well one he talked about on a show he was on had the stock price so depressed that the dividend payed 30% of the stock price. Thus in 3 years even if the stock goes down in value you have already gotten your money back in the stock.
Its a way to earn "rent" on your money. Thus even if my portfolio were to drop 40% I still get my X dollars a year from dividends.
A 30% dividend yield is fantastic, yes, but will earnings at those companies be able to support that dividend moving forward? We'll see. So far, average estimates for corporate earnings are down 20%.
Also, it would stand to reason that most of his clients purchased those stocks before the stock prices fell off a cliff. In other words, your 3 year estimate for making your money back only applies to those people who bought the stock after the market crash.
"Hamilton is really a Colossus to the anti republican party. Without numbers he is an host within himself. They have got themselves into a defile where they might be finished but too much security on the republican part will give time to his talents and indefatigableness to extricate them. We have had only middling performances to oppose to him. In truth when he comes forward there is nobody but yourself who can meet him. His adversaries having begun the attack he has the advantage of answering them and remains unanswered himself. For God's sake take up your pen and give a fundamental reply to Curtius and Camillas" - Thomas Jefferson to James Madison
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Oh no doubt Dustie, just trying to illustrate the different kind of investments that he gets for his customers as opposed to say a mutual fund. With him you get:
1) Dividends on your stock
2) Standard stock variation (appreciation potential)
3) As the foreign currency grows stronger in relation to the US dollar the invester also wins (and of course vice versa.)
Peter Believes the American economy and dollar is in for a big crash, and bases his investment strategies according to that prediction.
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So what are the cost of his services?
I have to say I had the same questions when the link was posted. They don't seem to be very transparent. That makes me nervous.
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There's no such thing as a transparent brokerage house. They are a private business and arent subject to disclosure. =) Simply think of them as a gaggle of financial advisors.
I have heard his fees may be slightly higher than other brokers.
Simply put if youre not a bear guy with a long term outlook on the market, they are not for you. Put I do believe he's one of the smartest guys in the business and calls it as he sees it. You get honesty from him, no matter how much it hurts. Also keep in mind he's the big dog there and you wont be dealing with him, but his underlings (unless youre a millionaire and demand his services =) ). I was all set to sign up until the market crashed, now Im stuck sitting on my main mutual fund until the market recovers. But If I were to come into a nice chunk of cash somehow, theyd be my first call.
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This was on C1 in the WSJ today:
http://online.wsj.com/article/SB123327685671031439.html
Quote:Early last year, Richard De Gennaro, a retired Harvard University librarian, put $100,000, about 15% of his assets, into a Euro Pacific account that included Canadian Oil Sands Trust, which focuses on crude-oil projects in Canada, and the India Capital Growth Fund, which holds investments in companies that do business in India.
Both investments took big hits in 2008, compounded by the fact that the Canadian dollar and the Indian rupee fell 18% and 19%, respectively, against the U.S. dollar. The 83-year-old retiree's account is now worth about $37,000, a 63% plunge. Mr. Schiff "goes around saying that he was right," says Mr. De Gennaro. "He was right about one thing and wrong about everything else."
Among investors who turned to Mr. Schiff's firm just as his strategy began to falter, Brian Kullberg, a design engineer in Portland, Ore., says he started to worry about the state of the U.S. economy in early 2008. He put $70,000 into a Euro Pacific account, hoping it would benefit as the U.S. economy and the dollar weakened. By late January 2009, his investment had shrunk to about $25,000.
It looks like his clients fared worse then the market in 2008.
Quote:Mr. Schiff says one year's poor performance doesn't prove he was wrong.
I agree that one year doesn't prove he was wrong, but it does prove that he couldn't translate his prediction into success, at least so far.
"Hamilton is really a Colossus to the anti republican party. Without numbers he is an host within himself. They have got themselves into a defile where they might be finished but too much security on the republican part will give time to his talents and indefatigableness to extricate them. We have had only middling performances to oppose to him. In truth when he comes forward there is nobody but yourself who can meet him. His adversaries having begun the attack he has the advantage of answering them and remains unanswered himself. For God's sake take up your pen and give a fundamental reply to Curtius and Camillas" - Thomas Jefferson to James Madison
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Ive read other things as well, including a very scathing article, albeit from a competitor brokerage.
I will admit that Schiff is very vocal and very hardline about his stances, and that may not equate well to someone's brokerage account with his company. It's generally unwise to drink the Kool-Aid when your money is involved. Schiff may be so over the top in his thinking that he has no "out strategy" for his clients, which is never a good thing. It's all about diversifying.
His biggest mistake was thinking the dollar would collapse and that other countries would be able to weather a poor U.S. economy, which he has been proven wrong on....so far.
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Schiff has responded to his critics:
<!-- m --><a class="postlink" href="http://europac.net/">http://europac.net/</a><!-- m -->
His first post on the commentary list.
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Breand Wrote:Schiff has responded to his critics:
<!-- m --><a class="postlink" href="http://europac.net/">http://europac.net/</a><!-- m -->
His first post on the commentary list.
I'd say thats a damn good rebuttal...cant wait for the video 'Peter Schiff was right...again' on youtube
[should not have shot the dolphin]
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Wow, I guess he's pretty ticked off.
I don't doubt that he could be "right" again about a particular issue -- what I want to see is that he's right AND makes money based on his ideas.
"Hamilton is really a Colossus to the anti republican party. Without numbers he is an host within himself. They have got themselves into a defile where they might be finished but too much security on the republican part will give time to his talents and indefatigableness to extricate them. We have had only middling performances to oppose to him. In truth when he comes forward there is nobody but yourself who can meet him. His adversaries having begun the attack he has the advantage of answering them and remains unanswered himself. For God's sake take up your pen and give a fundamental reply to Curtius and Camillas" - Thomas Jefferson to James Madison
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Talking of Schiff and gold, old yella just hit $1000 an ounce again, up from around $700 in November. On it's way to $2000?
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Id say it definitely is, yet Im still scared to buy into it because I feel like I missed the bus. Im more inclined to buy energy stocks right now which are at all time lows. Most gold funds are at all time highs, and well buying at an all time high doesnt make much sense.
An interesting lil tidbit that Schiff himself has touched on, twice in the 20th century, gold has reached parity with the Dow. So imagine that happening again, it could go much higher than $2000, or the Dow could go much lower.
I have a finance buddy and he is saying 7500 has been a psychological bottom in the market, and now that we've finally gone under, he expects the floodgates to open and the Dow to be at 6000 in March.
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The S&P is still above it's lows, but if those break it could be very bad. I'm hoping for a bounce off the lows and a rebound.
There's a lot of good stuff working in the economy right now. Lower gas prices are a tax break for everyone. Plummeting mortgage rates are helping people through refis and also ARM rates adjusting (our ARM rate just reset, and our monthly payment dropped $300. That should help slow foreclosures). And the stimulus will be kicking in, whatever the Republicans might say.
The biggest problem right now is the banks. C, BAC, and WFC are horrendous again today. WFC is below $10, and BAC is going to be in the 2s pretty soon. On the plus side, C and BAC now make up such an insignificant portion of the DOW that they can't really affect it on their own any more.
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