Peter Schiff Links 1971 Gold Decision to Today’s Dollar Crisis: Will XAU Hit $5,000?

Peter Schiff picked the 55th anniversary of America's break with gold to make a blunt case. The 1971 decision, he argues, is why the dollar is in trouble today.

Schiff is a founding member of Euro Pacific Asset Management. He made the argument on his weekend podcast. Washington defaulted on gold back then, he says, and the world is now leaving the dollar.

Why 1971 Still Shapes the Dollar Debate

President Richard Nixon closed the gold window on August 15, 1971. Foreign governments could no longer swap dollars for metal. The rate had been $35 an ounce.

"I have directed Secretary Connally to suspend temporarily the convertibility of the dollar into gold or other reserve assets… your dollar will be worth just as much tomorrow as it is today," Richard Nixon, in his August 15, 1971 address.

Nixon called the move temporary. It has now lasted 55 years.

The promise about value aged worse. Federal price data shows a 1971 dollar buys roughly 12 cents of goods today. Consumer prices have climbed 718% since that August.

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