Two of the most well-known characters in the cryptocurrency space have faced off in a debate compared to the famous Muhammed Ali versus George Foreman boxing match, the ‘Rumble In The Jungle.’ In this battle, the two outspoken pugilists were Peter Schiff, a stockbroker and vociferous crypto-skeptic who promotes gold as an investment class, and Richard Heart, the eccentric founder of HEX and PulseX.
The event did not fail to entertain. Schiff began by clarifying his position on gold, and how he views it as part of a larger portfolio.
“Let’s put gold in its proper context. I’m not all about gold,” said Schiff in the YouTube video uploaded on Feb. 24. “I’m an investment manager and I’ve constantly or consistently recommended that people hold 5-10% of a portfolio in gold, but the remainder of the portfolio is in incoming-producing assets, companies that I think have good fundamentals, that are growing their earnings, paying their dividends.”
Peter Schiff, the golden boy
Schiff went on to add that holding liquidity in gold was preferable to holding it in fiat currency, especially in an inflationary environment. To boil the argument down to simplistic terms, Schiff believes that gold is greater than fiat money and cryptocurrencies, but not necessarily better than traditional stocks.
“I like gold as an alternative to dollars, as an alternative to euros, yen, any of the fiat currencies,” said Schiff.
The argument was met with rude scorn by Richard Heart who replied, “Everything he just said was very stupid. This is going to be a very easy debate. I’m sorry for you guys that were hoping for something very exciting. He just crushed his own argument in the first minute. I’m debating with a guy that owns 10 to 20 times more not-gold things than gold things because he knows that those things are better assets. He says that gold holds value over time, it doesn’t.”
Heart then showed a chart displaying the price of gold against the dollar, adjusted for inflation from 1980 to the present day.
“Here’s a chart of gold adjusted for inflation where you lost money for 40 years. 40 years – you lost money. 40. If you had bought gold ten years ago – you’re down today! You’ve lost money from 10 years ago, not even inflation-adjusted.”
Richard Heart (center) debates Peter Schiff (top left)
Mr. Vain knows what he wants
Dressed like upholstery and bedecked in his signature gold swag, Heart threw a wild combination of attacks on Schiff. Shuffling through his prepared print outs Heart failed to locate the key HEX chart that backed his argument, but what the onslaught lacked in pinpoint perfection, was more than made up for in sheer devastating brutality.
“I understand what gold is supposed to be used for, gold is used for jewelry as 50% of its market cap… what is jewelry – it’s just vanity,” added Heart.
Heart went on to add that people can exchange bitcoin for gold and that Schiff’s own company accepts bitcoin for gold, proving that Schiff accepts that there is real value in bitcoin. The line of argument was not something Schiff was prepared to take.
“If you’re finished flattering yourself and congratulating yourself… first of all, uh, yes, just because I think that gold should be a small part of your portfolio doesn’t mean I don’t like gold. I just said that gold is not an investment, gold is like cash. Right now, I think there are a lot of very good investments around the world that I want to own [but] if I had a choice between just the NASDAQ and gold I would own all gold.”
Peter Schiff pointed out that if you’d bought gold five years ago or 50 years ago you’d be up, arguing that Heart was cherry-picking the time period, before reminding the audience that HEX was down 70% from its all-time high in September 2021.
Schiff then accused Heart of running a pyramid scheme and told him that his followers would be coming for him when it collapsed.
To the accusation from Mister Gold, Mister Vain just laughed.