On TraderTV, Peter Schiff Urges Caution For Retail Investors As Inflation Rises And Bitcoin Stagnates

For millions, the nationwide stay-at-home orders and lockdowns of the past two years provided an opportunity to cut down on personal spending and time commuting. This new found time and capital translated into an immense rise in online trading activity, combined with an increased volume of financial advice and information both supplied and demanded online.

While some managed to accrue small fortunes, many lost their investments in short order, having undertaken trades or investments with limited awareness of the risks involved.

As economies across the world are beginning to see the light at the end of the tunnel, experts are warning retail investors to drop risky habits developed in the pandemic-era and begin exercising more caution in their trading and investment decisions.

With research showing that trading during the pandemic grew at an unprecedented rate, it has become crucial for retail investors to assess their sources of information with caution. This is especially the case as research also shows there is a growing appetite even amongst the more novice new traders for taking increasing levels of risk with their personal capital.

These can often be life-changing investment decisions. If based off inaccurate speculation, fake news, poor advice or a simple lack of research, the financial implications could be harrowing.

In a recent interview with TraderTV, the financial commentator and stock broker Peter Schiff warned that a new wave of investors are too easily being drawn into a 'buy the dip' mentality.

Pointing to ever-increasing inflation in the US, Schiff warned there was every chance that this 'dip' would simply 'keep dipping' as fundamental market dynamics show little sign of strengthening. Ad such Schiff urged retail investors to exercise extreme caution when making their trading decisions, or risk getting dragged into a vicious cycle of losses.

For Schiff, investors should not be afraid to return to the Warren Buffett style of value investing, whereby key stock metrics are thoroughly examined in an effort to uncover both undervalued and overvalued stocks.

By understanding metrics such as price-to-earnings, debt-to-equity, and the overall health of company balance sheets, investors are less likely to fall victim to misinformation, malicious actors or speculative stock activity, he argued.

This is where platforms like TraderTV come in, providing a resource through which amateurs can learn from professionals in real time. Hosted by traders Brendan Wickens, Neal Roberts and Shawn Catena, the show's team offer analysis and insights on market-data and trading trends, and speak to company leaders and industry commentators such as Schiff.

Schiff also took the opportunity to amplify his bearish views on the crypto sphere. Describing Bitcoin as a 'gigantic ponzi scheme where you either run out of fools or the fools run out of money', he certainly didn't hold back. Likening crypto to gambling and questioning why the financial media seems to legitimise it on a daily basis, Schiff warned of a path to bankruptcy for those who fail to sell their holdings in crypto.

As inflation continues to creep across the global economy, investors are understandably looking for ways to hedge their bets. While Bitcoin's limited supply might offer some refuge from central bank over-printing in the long-term, its continued short-term volatility makes it seem like anything but a safe haven. There are also continued risks that retail investors get taken in by stories of outsized returns offered by the crypto market, when in reality these are few and far between, and seldom worth the risk.

In recent months the crypto market has also been visited by an number of hacks, as well as infiltrated by illegitimate coins or exchanges seeking to raise fiat funds from inexperienced investors. Crime involving cryptocurrencies hit an all-time high of $14 billion last year, blockchain researcher Chainalysis said last month, a record that comes as regulators call for more powers over the fast-growing sector.

In light of continued uncertainty across the world economy, Schiff forecasts a global uptick in investing in commodities over the course of the next decade, with gold and mining stocks likely to rise dramatically in the near future.