When it comes to silver, Americans are leading the world in hedging their bets in the shiny metal. This year, Americans have purchased one out of every three ounces of physical silver bar and coin compared to the rest of the world. And, that’s not all. If we also consider total Silver ETF demand, the U.S. based SLV ETF has seen its inventories increase by over 200 million oz in 2020.
Thus, Americans have purchased nearly half of all the global physical and ETF silver investment this year. According to the Metals Focus Silver Interim Report for the Silver Institute, the U.S. is projected to see a 62% increase in physical silver bar and coin demand this year over 2019. Based on the 2020 World Silver Survey data, total U.S. physical silver demand was 48.2 million oz (Moz) last year. Simple math puts the total estimate for U.S. silver bar and coin demand at 78 Moz in 2020. With global physical silver investment to be 237 Moz this year, the U.S. accounts for one-third of the total.
Furthermore, the U.S. based iShares SLV ETF, saw its inventories increase more than 200 Moz this year, accounting for two-thirds of the total 300 Moz growth in global silver ETFs.
Now, I don’t know if all that silver is located in the SLV ETF vaults, but it is still an excellent indicator revealing the increasing need for Americans to place more of their wealth into silver. I believe this is only the beginning of a rising trend that will continue over the following years.
I want to bring up an important topic that I will discuss more in future articles and videos. With the Bitcoin and Crypto prices moving back to highs, we see more financial talking heads suggesting that Bitcoin is now an alternative to gold. I saw this today on my Twitter feed below. Raoul Pal, who runs the Real Vision Group and Youtube videos, belongs to a growing number of NEW-AGE TECHIES who believe in a Cartoon Jetsons future.
This is huge news. This is the largest asset management firm on earth. 2021 is setting up to be a year of severe supply shortages vs. demand in Bitcoin, and upside price dislocations. #Bitcoin https://t.co/bz7hU4z6mP
— Raoul Pal (@RaoulGMI) November 20, 2020
Here was my response:
We shouldn't be surprised that more TOP FINANCIAL MINDS promote Bitcoin as a gold alternative…
It fits right in-line with the same insane GREEN ENERGY movement.
Green Energy isn't a real solution; it just makes the problem worse.
Same with Bitcoin. https://t.co/IfSlAWPeyI
— SRSrocco Report (@SRSroccoReport) November 20, 2020
And here…
SPOTTING THE OBVIOUS:
If BITCOIN is an alternative to GOLD as some financial talking heads claim…
Then GREEN ENERGY must be an alternative to Oil & Fossil Fuels. But it isn't.
Thus, in the end, BITCOIN will turn out to be a HIGH-TECH TULIP BUBBLE on STERIODS.
— SRSrocco Report (@SRSroccoReport) November 20, 2020
With tech stocks continuing to head STRAIGHT UP to the heavens, based upon pure speculation, this will end badly. The notion that gold and silver are OLD FASHION and need to be replaced by a much more high-tech secure cryptocurrency that consumes a massive amount of energy, will fail the test of time when we consider the ENERGY CLIFF that has begun.
More on this in future articles and videos.
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It is hard to believe that this amount of silver is being bought by the silver stackers, for want of a better description, in the US. Is there a chance that it is very quietly moving into the vaults of the family trusts, for want of a better description?
Yes, a very good chance! I’m helping.
March 2017 was a really big deal. It was the first time you could buy 1 ounce of gold for 1 whole bitcoin. It was the start of an amazing bull run for bitcoin, and it hasn’t gotten back to anywhere near that ratio since then; the lowest being 2.5:1 back in FEB 2019. Now the ratio stands at 10:1, so I can buy 10 ounces of gold with 1 bitcoin, but I wouldn’t do that in reality because the ratio is going to 20:1 and higher.
Have you ever tried to move gold across any border? It was a great monetary standard, but its day in the sun is over. Bitcoin is the new standard, and guys like Peter Schiff will go to their graves claiming gold is the only alternative to fiat currencies while his own son will sell off his gold inheritance and buy bitcoin with it.
You conflating the green energy movement with the bitcoin movement makes absolutely no sense. You think you landed some kind of twitter kill-shot, but the bitcoin industry leaders just smile and nod at your comments and say, ok boomer.
SD,
I have no problem if someone wants to invest in BITCOIN. Go ahead and buy as much Bitcoin as you like.
However, if you don’t see the BITCOIN-INSANE GREEN ENERGY CONNECTION, then it makes perfect sense why you believe in Bitcoin as a long-term alternative to gold.
GOD HATH A SENSE OF HUMOR.
steve
Steve,
Just because you make a claim doesn’t make it so. I look forward to you linking bitcoin, a decentralized money, to the green energy movement. The top financial minds like profits. Bitcoin has outperformed gold by a factor of 10 in the last 3.75 years. Why wouldn’t financial minds be interested in it? It would be negligent on behalf of their customer base to ignore those gains against gold.
A friend of mine is a metal detector aficionado. One day he found a 1920 mercury dime buried beside an old farmhouse. Based on the condition (seemingly uncirculated grade) and depth at which it was found (about 6 inches), we estimated that the dime was probably dropped in the sod shortly after it was minted.
So, the dime was probably lying there for 90 to 100 years. Just an estimate, of course, but probably in the ballpark. The dime was still in nearly perfect condition. After wiping off the dirt, one would believe it had been lying in someone’s dresser drawer all those years, warm and dry.
1) Think of all the natural elements that had an impact on the condition of that dime. Soil chemicals, oxygen, thousands of rain storms, four-hundred changes of season. And this humble little dime is still in near-perfect physical condition.
2) Think of all the social, economic and political vicissitudes that Mankind has been through in the past one-hundred years. World wars, genocide, depressions, etc. etc. etc. Unbelievable, to say the least. This humble little dime has seen it all, and still exists unchanged and unaffected.
Now, where do you think Bitcoin will be in 100 years? Think of the vast myriad of fragile man-made systems- social, economic, political, and scientific that must be kept intact to preserve the value and simple EXISTENCE of Bitcoin.
I think I’ll stick with physical.
7 years ago, you could purchase an ounce of silver or a bitcoin for the same price. Today, the ounce has perhaps doubled in fiat value, and bitcoin has gone up 600x. The false choice most stackers make is to say PMs and bitcoin are an either-or position. WRONG. One can own stacks of PMs and a small amount of bitcoin, say 5% or 10%.
Given the foregoing, the safest bets in the crypto space could turn out to be Theta (decentralized sharing of bandwidth via blockchain) and Zilliqa (sharding of transactions making them faster and cheaper)…
Tom Luongo yesterday: https://tomluongo.me/2020/11/20/market-friday-bitcoin-apotheosis-gold-bugs/
His blog is called Gold, Goats & Guns… and he understands the upcoming paradigm shift.
I have gold stored in European and Asian vaults as a hedge. Lot’s of different ways to own Gold and Silver. All the vaults are insured and I can have the money deposited into any of my global accounts in any currency I want. Not saying it will work out as planned, but that’s why I have several different custodians in different jurisdictions. I am not a Bitcoin “investor”, however I am a Bitcoin speculator. Bitcoin acts like a speculative instrument designed to fleece the unsuspected. People come out of the woodwork on social media to promote Bitcoin like a well oiled propaganda machine. All the financially “famous” people that can barely spell crypto promote the investment on cue via the mainstream financial media. IMO there is a group of investors with deep pockets intentionally promoting a Bitcoin speculative mania in order to capitalize on the fear of a longterm Dollar decline. Rinse repeat we’ve seen this story before. Millennials are the target mark. They’ve earned enough to start investing in markets, but haven’t attained a savvy and healthy respect for the market. This is their first financial shearing. Boomers and Gen-X have already gone through several watershed declines and are less likely to put “real” money into Bitcoin. Thus the focus on millennials. You can tell me Bitcoin is like Gold until your blue in the face, but none of the usual “arguments” change my mind. Because at the end of the day, I understand what Bitcoin and Gold offer and for obvious reasons I like real stores of wealth.
A well thought out reply, and I agree with most of what you’ve said. There are two problems with having a custodian store your gold: 1) counterparty risk, be it the company itself or a corrupt government confiscating that company’s assets, 2) cost. For the wealthy the storage costs might be minimal but for the average middle class investor who owns less than 100 ounces of gold does it really make sense to store your wealth in Europe or Asia? I value freedom of movement, and holding my own assets. I can get on a plane and travel from the US to Asia, Australia, or South America with my entire wealth with me and nobody can confiscate it, and I have access to it throughout all my travels. That is powerful, and there is value to that. Deep pocket investors trying to get the retail suckers to buy their bags at the top of a bubble is nothing new and it happens in all markets every day. Same thing with bitcoin/crytpo. I’ve been advocating for bitcoin for years during bull and bear markets alike. If someone doesn’t understand buy low, sell high, then they shouldn’t be investing in financial markets in the first place.
Imagine internet is heavily censored, access restricted, due to power shortages servers are on line for a couple of hours…
Now, you have in virtual wallet bitcoin and you need to use it urgently for whatever reason, where you gonna plug in to access wallet?
No, I haven’t tried to move gold across any border. From my location, I don’t need to smuggle gold to Mexico or Canada. Are you expecting to cash in some bitcoin in Mexico? You think everyone will accept bitcoin wherever right? My PM is already cashed in. Don’t need a laptop, electricity, internet, bank(S), ATM, safe connection. I don’t even have to worry about the law chasing trails on the internet if something goes illegal about owning PM.
I think at this moment more people are discussing, and know more about bitcoin than precious metal. All they see is the price rising but haven’t a clue what to do with crypto. 78m oz of silver is a drop in the bucket, $2 billion?, against all the money invested in US markets. In this case, please DO buy bitcoin because it truly leaves more PM for us while it’s still available.
Quote Of The Week~~
“Next week’s trading could well see the start of an epic squeeze on bullion bank trading desks.” –Alasdair Macleod
Gold has outperformed the Dow industrials quite handily over the past 20 years, and that isn’t exactly cherry picking data. Bitcoin has had an exponential rise in price, but remember the very first question the IRS asks on form 1040 schedule 1 is if you’ve had any interest in any virtual currency, not just if you’ve profited from the sale thereof. This is a huge red flag and I would expect more of the same going forward.
There is no doubt that bitcoin and other virtual currencies are speculative in nature. However gold is money, and any speculation associated with it is due to central bank policies. Comparing gold to bitcoin is absurd. If anything, gold’s value in fiat currency should be compared to so called risk free assets such as US treasuries, an analysis of which will quickly make any thinking investor start stacking US gold coin immediately.
Well said. Especially the part about Form 1040.
The IRS question is “at any time during the year, did you receive, sell, send, exchange, or otherwise acquire any financial interest in any virtual currency?”
So what. I checked yes on this in 2019 and I ensure my CPA divulges any of my profits in bitcoin trading (which are minimal because I mostly just hold). Do stock traders not take any profits because they don’t want to pay taxes? Cutting off your nose to spite your face is a bad strategy.
Follow The Pied-piper lest he play a captivating tune. Chickens seem like a better investment than bitcoin…. looking forward into the future. Gonna be stellar watching all that money pile into sliver. Or rather all that worthless plentiful flow of paper trying to buy rare precious money. dyslexic :\
I’m always wondering how they can claim that something man made, like bitcoin, can be a store of value and a replacement for gold. What if tomorrow people invent something even better than Bitcoin?
What will then happen to the value of Bitcoin?
Here’s how I sum up the Gold/Silver argument about Bitcoin. Gold and Silver have always been recognized as true forms of money and store of value (Holds it’s purchasing power over time) for over 6000 years. Bitcoin is an electronic entry on a computer blockchain program that requires electrical power. If you don’t hold it!…….You don’t own it! Very simple logical concept.