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Jim Cook

 

RUNAWAY SOCIAL SYMPATHY

Every once in a while I switch the TV channel from Fox to CNBC to see what the liberals are saying.  After listening awhile I get a deep sense of hopelessness and foreboding for our country.  The most important thing for the left is giving money to people.  They are happy to see the growth of food stamps, disability payments, housing subsidies, free healthcare and all the other welfare benefits.  They utterly fail to see the damage it is doing to the recipients.  Whole cities that once flourished have deteriorated into rotting eyesores populated with shambling hulks of chemically dependent drones.  These people are no longer employable.  They have become incompetent and helpless and the liberals can’t see that it’s their doing.

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The Best of Jim Cook Archive

 
Commentary Of The Month
January 6, 2017
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THE SILVER SURGE

By Egon von Greyerz

Physical silver is now an attractive investment. Silver will appreciate at twice the speed of gold. The risk/reward situation for silver changed at the beginning of 2016. Silver has now reached a point where relative to gold it represents excellent value. What is particularly interesting is that silver is now in a position to move twice as fast as gold.

If gold reaches $10,000 which I believe is a minimum without hyperinflation, that would give a silver price of $666 to $1,000. These are clearly levels that sound totally unrealistic currently with silver at $17 but are likely to be achieved within 5 years or so.

What makes silver particularly interesting is its scarcity. Around 170,000 tons of gold have been produced in history and virtually all of this quantity is still around in one form or another. This is not the case with silver. There are no significant silver stocks anywhere in the world. Almost 60% of the silver produced is consumed, the rest goes to silverware, jewelry and investment. Central banks hold no silver stocks. The annual global silver production is 27,000 tons which at $17 is $15 billion. As a comparison, annual gold mine production is $114 billion. More silver has been consumed globally than has been produced for a number of years. Investment demand for silver is only $2.5 billion annually. The total size of the silver market is miniscule in relation to world financial assets. That is why it has been very easy for Deutsche Bank, UBS, Barclays and a few other banks to manipulate this market. Deutsche has admitted their rigging of the silver market but since they have implicated a number of other banks, we haven’t seen the end of this story which is very likely to spread to the gold market also.

Silver is normally the leading metal. It moves faster down in a bear market for precious metals and when the market turns bullish, it outperforms gold. The fall of the gold/silver ratio indicates that the manipulation might soon come to an end which will lead to increased physical demand. That in turn will put the paper silver market under severe pressure. As physical demand rises, the silver price will increase rapidly. Even today it is difficult to find big quantities of physical silver and as the price rises there will be no silver available. Any surge in demand will only be satisfied at substantially higher prices.

Silver should not be bought for speculative purposes but for long-term wealth preservation. For any investor who doesn’t hold silver, it is my strong belief that now is an excellent time to buy physical silver at a price that will never be seen again and for a journey which will be extraordinary.