Global Silver Scrap Supply Falls To 26-Year Low

Global silver scrap supply fell to its lowest level in 26 years.  World silver recycling in 2017 dropped by nearly 50% since its peak in 2011.  According to the 2018 World Silver Survey, global silver scrap supply declined to 138 million oz (Moz) compared to 261 Moz in 2011.  While the lower silver price is partly responsible for the large drop in silver recycling, there are other market dynamics.

For example, silver recycling from the photography sector has declined since consumption peaked in 1999.  The photography industry was using 228 Moz of silver in 1999 compared to the 44 Moz last year.  Thus, silver consumption in photography has declined by 80% in nearly two decades… and along with it, a great deal of recycled silver supply.

Furthermore, a lot of silverware was recycled during the period of rising prices (2007-2012).   A lot of Millennials who inherited their parent’s (and grandparents) silverware decided it was much easier to pawn it rather than spending a lot of time polishing it for holiday gatherings.  Which means, a lot of available stocks of silver scrap have already been recycled.

As we can see in the chart above, even though the $17 silver price in 2017 was four times higher than in 1991 ($3.91), global silver scrap supply is less than it was 26 years ago.  Moreover, world silver scrap was over 200 Moz a year (2005-2009) when the average annual price was much less than it was last year.

Now according to the Metal Focus Silver Scrap Report published in 2015, they forecasted the following percentages of silver scrap from the various sectors:

Industry = 60%

Silverware = 16%

Photographic = 12%

Jewelry = 10%

Coin = 2%

While it is well known that the majority of silver scrap comes from recycling of industrial silver waste, due to the industrial sector being the largest user of silver, jewelry only accounts for 10% but is the second largest consumer.  For example, the 2018 World Silver Survey reported that the industrial sector consumed nearly 600 Moz of silver in 2017 while jewelry fabricators used 209 Moz.  However, silverware and the photographic sectors only consumed 102 Moz, but account for 28% of silver scrap supply.

What this tells us is that owners of silver jewelry are not that motivated to pawn their silver jewelry because there just isn’t enough monetary value.  So, a large supply of potential silver scrap will likely never make it to the market, even at much higher prices, due to the relatively small value of silver jewelry held by individuals.

As for gold jewelry, it’s quite the opposite.  Nearly 90% of global gold scrap supply comes from recycled gold jewelry.  Thus, a significant increase in the gold price would result in higher gold jewelry recycling, whereas a higher silver price would not generate much of an increase in silver jewelry scrap supplies.  So, each year about 200 Moz of silver are used in silver jewelry fabrication, but only a small amount is ever recycled.

Lastly, annual gold scrap accounts for 28% of total global gold supply compared to only 14% for the silver market.  Even at much higher silver prices, global silver recycling will not be able to supply enough metal when investment demand surges as the broader markets collapse.

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47 Comments on "Global Silver Scrap Supply Falls To 26-Year Low"

  1. Muhammad_Aidid | April 16, 2018 at 11:34 am |

    2011 compared to 2017?
    Why not 2016 to 2017?
    Not much decrease , right?
    ——
    Photography uses less silver by more than 80%. Isn’t that a bad news for silver? Yet suddenly it’s a good news because it implies less silver scrap?

    In 2011 the price was 3 times of today’s price. How is the relationship between silver scrap supply and time being concluded to show bullishness when price does not act as fixed or controlled variable in this case? Considering the price was triple before, it is very logical that scrap or second hand silver supply volume will soar tremendously with the increase in price.

    Sure demand for silver in photography reduced much yet mined silver just dropped by 4% compared to 2016.

    Demand for investment silver coin and bar plunged by 35% and 16% respectively. Then why these are not mentioned here for a more transparent and honest reporting?

    Seems every good news is good news and every bad news is good. Yet only stocks follow that rules, looking by their prices while silver followed only in articles???!!!

    • Muhammad-Aidid,

      You are more than welcome to continue looking at the Precious Metals as the HORRIBLE INVESTMENT compared to all the Debt-based Fiat Money and the overleveraged assets.

      Let me state firmly, the article did not include falling Silver Investment Demand because EVERYONE AND THEIR MOTHER-IN-LAW knows that. However, global silver investment demand was only 8 Moz less than in 2012 when the price was $30 an ounce.

      Lastly, there is no BAD NEWS owning gold and silver. But, please continue to write comments to the contrary.

      steve

    • Well, MA, while the BoJ buys up 75% of ETF’s in the ‘markets’ with printed currency, i’ll stick to hard assets like gold & silver.

      Debt based currencies depend on perpetual growth, without cheap surplus energy growth is over. So keep drooling on distortions in ‘markets’, and keep hoping inflated currency will buy you something when this crap implodes. Maybe silver won’t get you to the other side, currencies certainly won’t. Its game over for the fiat system.

  2. Let me second the comment above and offer, again, my contrary opinion here.

    Isn’t it more likely that if the system collapses, that money will inflate and people will find themselves spending the money they have for the necessities of daily life – such as shelter, food, electricity, gas, etc. – and liquidating everything to pay for it?

    Which would, of course, include silver. So, actually, silver would perform badly in a collapse scenario. Which basically means there aren’t many scenarios left in which silver performs well.

    But there’s a reason for this, a reason overlooked by all of the gold and silver pimps: banks control the massive paper market in these metals. You can’t get a normal bull market without wresting back control from the banks, but you will never do that since banks own the system and nobody will oppose them.

    So, I predict continuing inflation and continued LOW prices for gold and silver. The latter now confirmed by 7 years of experience, with both theory and practice confirming that the banks have the ability to absorb ANY amount of physical gold or silver demand. No amount of physical gold and silver demand – none – makes the price rise anymore. Every last ounce could be disappearing into vaults and private homes across the world, and price will not rise. And as the inflation ramps up, you will in fact find yourself liquidating the metals which you so dutifully stacked.

    Game over.

    • dolph,

      What a pleasure for you to finally come back under the “dolph” screen name to leave your consistently negative message. Actually, I have been looking forward to this splendid opportunity.

      First… the reason I deleted your last comment was not due to differences of opinion, but the use of DEROGATORY RACIAL LANGUAGE for which I thought you would know better.

      Second… then you tried to leave another comment under a different screen name but with the same IP Address and a BOGUS email address.

      Third… then you contacted me via my contact page to let me know that I was DELETING comments by those who disagreed with me and that you were going to make sure that everyone finds out that I am a charlatan. How nice of you to spend your time in this endeavor.

      Well, dolph… I tried to respond to the email address you gave, but of course, it was BOGUS as well.

      So, please feel free to write all the negative comments because it’s easy to do so with a BOGUS email address.

      steve

      • Hey dolt…er… I mean dolph

        “Isn’t it more likely that if the system collapses, that money will inflate and people will find themselves spending the money they have for the necessities of daily life … and liquidating everything to pay for it?”

        They won’t be able to liquidate much because everyone else will be selling the same stuff. They will be getting just pennies on the dollar on the stuff they have – stocks, cars, furniture, vacation homes, etc. It will be like everyone in the same neighborhood having a garage sale and selling the same plastic toys, VHS tapes, old record albums, clothes, and gaudy 70’s furniture made from pressed wood.

        “So, actually, silver would perform badly in a collapse scenario.”

        What planet are you on? No, silver will be the best performing asset in a collapse scenario. Everyone will be trying to get out of every other asset and they will need something that’s got intrinsic value, is portable, recognizable and easily divisible. A mercury dime is perfect for this.

        “banks control the massive paper market in these metals.”

        Banks and most electronic support infrastructure may be gone in a collapse. How are they going to manipulate?

        “No amount of physical gold and silver demand – none – makes the price rise anymore.”

        Really? How can you be so sure? As General Arthur “Bomber” Harris once said about the supposed uselessness of strategic bombing: “It hasn’t been tried yet!”

        “…continued LOW prices for gold and silver. The latter now confirmed by 7 years of experience.”

        Are you kidding? 7 years? Not enough time! Nothing goes up in a straight line, my friend! Why don’t you talk about the last 45 years, $1.30 to $17?

        “And as the inflation ramps up, you will in fact find yourself liquidating the metals which you so dutifully stacked.”

        Maybe. But probably at a level over $300 per ounce – 10 to 15 times my investment. I might have to use it, but at least I’ll have something to liquidate, unlike the vast majority of the “Joneses”.

        I once knew a man who had a grandmother that had to be put into a nursing home because she could no longer take care of herself. When they started moving her out of her house, they found that she had two empty bedrooms full of – no kidding – Beenie Babies! If she had invested the same amount of money into silver at the time she bought the dolls (1995), one of her family members may have been able to quit their job to take care of her (2012). In fact, she was nearly destitute, and they had to practically give the Beenie Babies away. Sad.

        Silver and Gold will always be worth what it has been for thousands of years, or more.

    • You have a point. I have heard many times that while metals are great to own, AND easy to obtain because of the manipulation, holding them all the way through once it really goes down is quite another story.

  3. Steve

    It’s all very interesting but my take is precious metals are commodities. Same as rare earth which are more valuable per oz. These are not currencies or money. Money is legislated into exsistance. At one time gold and silver were struck into coins which is true but by government decree. If governments choose to settle accounts with precious metals you might have a good argument but they’d be stupid to do it. They need the fiat currency to grow the money supply.

    • JT Roberts,

      You bring up a good point if the Central Banks were able to print BARRELS OF OIL. If they could do that, then yes, gold and silver are just mere commodities. But, the fact that Central bankers can only print money and add debt does not solve our dire energy predicament.

      So, without being a broken record, the reason to own the precious metals is a HEDGE against falling oil production and thus, FALLING VALUES OF MOST ASSETS.

      Does that clear up things a bit?

      steve

      • In Old England they used a tally stick for 700 years. No coins or gold at all. The foundation of the system was that Henry I legislated that all taxes be paid with tally sticks. They were one of the first fiat currencies. My point it there is nothing inherently monetary about precious metals. They don’t turn into money when oil stops pumping they more likely turn into lead. Right now the biggest hoarders of gold are Russia and China for gold to become the means of security your actually saying that those two countries will become the reserve currency system. I don’t believe the US will let that happen but if it does you might as well own rubles or yuan.

        My point is you can’t separate currency from government and particularly here there is no way the government would demand gold because it would only strengthen foreign nations.

        • Forgot to mention it’s more likely that the government will confiscate it which they have done in the past. FDR

          • In my opinion gold & silver is ‘universal money’; when currencies die, the reserve currency dies with them. Regions, countries, states and villages need trade for as long as things hold together. They all have their own ‘currency’ or ‘money’, backed by corn, oil, gas, silver. Monetary permaculture, all measured against gold to give it ‘value’. Imho there won’t be a reserve currency after the fiat collapse because countries blow eachothers brains out instead of trade with eachother.

            Gold as backbone. Just a guess of course, but think about it. I’m not a bug, i try to foresee several possibilities.

        • It’s that arrogant thinking that will catch you by surprise. I’m sure England had the same thoughts when they were on their way down also…

        • JT Roberts,

          There is one CRITICAL FLAW in your comment on the Old English Tally Stick. The tally sticks were used in the same fashion as the REAL BILLS DOCTRINE. The tally sticks could be traded and discounted, but they did not act like Fiat Money.

          IMPORTANT: Tally sticks were IOU’s for coins. Thus, gold and silver coins (or goods) had to be used as PAYMENT to settle the tally sticks.

          steve

          • It was a debt based system as well.
            So we can debate fiat

            Each party to the transaction was given one half of the marked tally as proof. Because the type of wood used to create the tally was selected for its clear grain, the grain of the wood was similar to the watermark on today’s paper money. The two halves would be perfectly matched, fraud was difficult to perpetrate, and refinements were added over time to make the documentation of the transaction virtually tamper-proof. The two halves of the stick were made different lengths, with the lender given the longer part of the stick, referred to as the stock, which formed the basis for the modern term “stockholder” while the shorter portion, called the foil, was given to the party who had received the goods or funds. Literally, the debtor received “the short end of the stick.”

            When the borrower returned to the lender with the goods or money owed, the two halves of the record would be “tallied,” and any attempts at fraud would become immediately apparent when the two halves of the split tally were combined.

            King Henry expanded the use of tally sticks to include the collection of taxes by local sheriffs, creating a demand for them, and the sticks began to circulate as a form of money as a result. Revenues owed to the Crown were collected in this manner, and the tally stick system formed the basis of the British Empire until the formation of the Bank of England at the end of the 17th century. Tally sticks found their way into medieval courts as evidence, and into the works of William Shakespeare, who referred to them in Sonnet 122.2 from Henry VI: “nor need I tallies thy dear love to score.”

          • JT Roberts,

            As I mentioned, the Tally Stick was similar to the system set up by Adam Smith’s Real Bills Doctrine. The Real Bills (precursor to Treasuries) were used to get goods to the market but were settled by the gold and silver coin.

            You are forgetting that the Tally Sticks were not the payment, they were the IOU’s for payment in coin or goods.

            According to Adam Smith:

            Adam Smith notes that in the time of King William the discount reached 60% when the Bank of England suspended transactions during a debasement of the coinage.” Why did they depreciate? Because they (tally sticks) were IOUs for money, and the coins were debased by the government.

            The tallies functioned as money because they were IOUs for money: coins used to pay taxes. There was nothing fiat about them.

            So, RT Roberts, the Tally sticks were not the PAYMENT, they were the RECEIPT of PAYMENT. Do you understand the difference?????

            steve

          • The discount on Tally Sticks was a function of fractional reserve banking. So like today the dollar is based on the faith that ultimately the government backs its value. In a similar way when Nixon closed the door on convertibility for gold the dollar took a hit.

            Anytime we have a fractional banking system inflation becomes a necessity to payback debt with interest. That requires increasing the money supply not just value. That is the problem with gold if you don’t increase the quantity you can’t grow the economy.

            Let’s say I borrowed an ounce of gold but I have to repay 1.1 ounces back. How do I do this? Someone has to mine the difference and I have to generate enough value to accumulate the 1.1 ounces to square my debt. So the entire economy is stranded it can grow only as fast as I can mine gold.

            Another effect could be to increase demand for gold by demanding payments be made in gold. So golds value will increase in relationship to real goods and services but inflating the value rather then the stock is counter productive because my best investment is to hoed it because scarcity increases its value.

            Once again the economy is stranded by gold production because it only functions in proportion to production.

            This was the trap that Spain found itself in. What they didn’t realize is it was the pursuit of gold that built their economy not the acquisition of gold. So money is not true wealth. Wealth is a function of productivity. Society is productive when it’s individual members are which is closer to Labor Value. Energy leverages labor allowing progressive productivity gains which increases industrial production per capita which is wealth.

            So fractional reserve fiat currency isn’t bad in itself it only runs into problems when productivity can’t increase on a per capita bases. This is why energy growth is an absolutely necessary ingredient.

            So let’s imagine that all fiat currency disappears what happens to gold or silver? Do they inflate to the value of the missing currency and how do we measure that? Let’s say the market collapses 50%. Will precious metals inflate to substitute the lost value?

            The problem is when debts are in dollars people will want dollars not gold. The value of gold will be stranded by people who have any surplus dollars to buy it but arguably their dollars will be worth more then the gold they could buy with them. So we could see a strong reason to say that gold will lose value as it chases fewer dollars.

          • JT, in a degrowth environment, currencies cannot excist. Only money will do the job. Money is a medium of exchange, nothing more, nothing less. Debt based, woodsticks etc. are all based on greed. Borrowing from the future always leads to disaster, because human nature cannot deal with it. Certainly not 7 billion people fed up with perpetual bullshit. The intermedium of exchange CANNOT differ from its goal in a degrowth environment. The fogs of fiat fooled us. That wasn’t a BIG problem for 5000 years. It is now.

      • Steve, in away the central banks are printing barrels of oil. By suppressing the interest rates it allowed the tight oil industry to become a reality. Obviously there is a limit to this and since no one knows exactly what will happen or when it will happen one hedges their digital wealth with hard assets that are portable. Which pretty much narrows that down to pm’s. A small garden and decreasing your dependence on a just in time delivery system is also a very wise thing to do.

        • Adam,

          While you bring up an interesting point on the Central Banks ability to lower rates to allow the Shale Oil Industry to function, we must remember that all it did was transfer the COST to the investor. As hundreds of billions of investor dollars went to subsidize the Shale Oil Industry, the shale oil companies are only paying an INTEREST EXPENSE. However, the rising interest expense is now starting to cut into their profits.

          While the Central Banks have allowed Shale Oil & Gas to come on the market, I see it falling apart within a relatively short period of time when the Stock Market crashes by 50%.

          steve

      • I’d like to add that China is starting to do just that with oil-futures trading priced in yuan, with the yuan fully convertible into gold on the Shanghai and Hong Kong foreign exchange markets.

        Bonus reading:
        https://www.silverdoctors.com/gold/gold-news/jim-willie-neither-banks-nor-u-s-govt-or-military-can-stop-china-russias-coming-gold-standard/

  4. I don’t think many Americans have much silver. I may be wrong but the common Joe probably has more 10-14ct gold (rings, jewelry) by weight than silver, just as the article points out.

  5. If you read the writings from “Another” in the USA Gold site then you learn and know why gold and silver are money. Governments know this but keep this secret. When all collapses and governments print like 1922-1923 Germany then gold and silver prove they are money. The ones who do not know this will never know because they do not know what money is. Intrinsic value is money, everything else is liability or promises.

  6. Steve—
    Love your work. Thank you.
    Know people will gladly pay $50+ an ounce for Silver.
    They will. I know it to be true because I’ve done it. And was doing it gladly, this time seven years ago. Pick up some late week for under $19 and was happy to do that. Will get more tomorrow likely still under $19 as COT Tuesday’s are often the best day of the week to add……
    But to what profit?
    I am seriously under water as one who caught on to the Silver story for all the right reasons at what was clearly the wrong time to begin wealth preservation.
    Life is about choices.

  7. bill simmons | April 16, 2018 at 8:07 pm |

    The best way to buy silver is to buy it over time when prices are high or low to cost average.In Australia in year 2000 i could have used a $5 note to purchase 7 litres of fuel or 1 oz of silver.today i can only buy 3 litres of fuel with my money but my 1 ounce of silver can now buy approx 12 litres of fuel. even with depressed silver prices the value of my real money prevails by a very wide margin. its an insurance if you like against a dollar that loses purchasing power.

  8. The “almighty” US dollar is conjured into thin air, with the $100 bill costing slightly more to ink up over a $1 bill, due having more unique markings to cut down on counterfeiting. The same can NOT be said for a legit ounce round/coin/bar of .999 silver vs a 5 ounce round/coin/ bar. Sure, the one ounce variety is more liquid than its 5 ounce counterpart, BUT the total weight b/t the two speaks for itself of which one holds more value.

    How is this concept so hard to understand on some of non-critical thinking people commenting? In other words, why would you keep your hard earned labor and savings in a medium that can be fractioned out at whim with no more or less energy required? Kindergarten math is escaping you at your own detriment.

    If you’re in this for a get rich quick scheme, then admit that and gravitate to your paper wealth stores of “value”.

  9. Most likely scenario we going to have soon is “War with Russia”.
    Gold and other precious metals will go up because of geopolitical reasons not because collapse of stock market.

  10. Before we go off the rails with Kindergarten math it would be good to examine 16th century Spain. Spain experienced a severe depression and simultaneously had more stores of gold and silver then any other nation of it’s day. All it’s precious metals didn’t save it. The point is once the economic system breaks it won’t matter how much gold you have. The economic system is an information system it assigns values that distribute energy plan and simple. Once the energy starts declining as it is now the values become disconnected from reality as they are now. The illusion of wealth is a product of debt creation.

    Even if you transfer your assets to gold you have to believe you can convert them back to some kind of currency in order to exchange for values that are underpinned by energy transfers. When systems collapse the information collapses with it meaning the markets will no longer determine values instead values will be legislated. No power will be beholding to gold either nationally or locally. Basically we are living in a huge protection racket that is presently global as the global system unwinds it will become local protection rackets. Gold won’t be bringing the Walmart truck to town no matter how much you have.

    • This is the problem stackers for COLLAPSE don’t appreciate in nations that don’t support gold and silver.

      It’s not just the Walmart truck. In USA for example:

      99% of the population does not have any gold or silver.
      99% will not be trading with gold or silver.
      99% in a collapse will be screaming for water, food, heat, clothing and other essentials.

      99% will not care one bit for gold and silver.

      You need a nation like China or India where everyone has some gold and silver, that’s where you might have some chance.

      • Cary,

        You bring up an interesting suggestion that 99% of Americans won’t care about gold or silver. I disagree.

        I can assure you that Americans who pawned off tens of millions of ounces of gold jewelry after the 2008 Financial Crisis most CERTAINLY CARED about getting the money and understood gold’s worth.

        According to my data, Americans pawned off 32+ million oz of gold from 2008-2016. Please check out my article here: https://srsroccoreport.com/u-s-gold-scrap-market-drying-up-americans-pawned-off-their-best-asset-to-go-further-into-debt/

        While the public is stupid, fickle and invests in the wrong things a lot of the time, but when the value of gold and silver surges… AMERICANS will get PRECIOUS METALS RELIGION.

        steve

        • Kind of makes my case. The demand for dollars trumps demand for gold. When times are hard debts still must be repaid so gold chases dollars dollars don’t chase gold.

        • Mixing the words precious metals and religion?

          Interesting, kinda says it all.

          NOT for me, that’s a road to hell.

          Gold is just another asset class of many that only deserves appropriate allocation.

    • Interesting that trolls now are history fans. While Spain had the largest silver stack in the world there was no recession. That only started when Holland and England through stealing amassed a bigger fortune.

      • The economic problems of Spain

        Citation: C N Trueman “The economic problems of Spain”
        historylearningsite.co.uk. The History Learning Site, 17 Mar 2015. 17 Apr 2018.

        Philip II of Spain inherited what was considered Europe’s most wealthy nation with no apparent economic problems. By 1598, Spain was essentially bankrupt and Philip III inherited a nation seemingly doomed to decline. How did these economic problems come about?
        When Philip inherited the throne in 1556, to all people he appeared to be Europe’s most wealthy monarch. However, behind the glamour of royal life, the economic troubles that were to plague Philip throughout his reign, were developing. His inheritance from his father, Charles V, hardly helped him.
        When Philip inherited the lands given to him by his father, he inherited with it many economic problems.Charles left Philip with an empire that neither Spain’s military or economy had acquired. In order to keep up with the demands placed on it by its empire, Spain had to try to upgrade itself into a world power quickly.
        One of the main problems Philip faced with his empire was that each part was supposed to be self-financing and yet the majority of the time Castille ended up paying for much of Philip’s policies. For example, the Italian states paid 400,000 ducats to the cost of the Battle of Lepanto which affected them most directly, but Castille paid 800,000 ducats.

        Philip was forced heavily to rely on taxes in Spain and in 1561 the servicio tax was made a regular one, the excusado was introduced in 1567 and the crusada tax, together were known as the “Three Graces” reaching as much as 1.4 million ducats per year in the 1590’s. However this was still not enough money and the Cortes had to be persuaded to grant the millones tax in 1590. The end result of all this taxation resulted in a tax increase of 430% between the years 1559 and 1598. This hit the Spanish peasantry hard, since the nobility were tax exempt. Between the same time the average wage only increased 80% and so the Spaniards witnessed a tax revolution as well as a price revolution.

        https://www.historylearningsite.co.uk/spain-under-phillip-ii/the-economic-problems-of-spain/

        • You are talking about a short lived recession that happened before the bulk of the silver stolen from America arrived to Spain. From 1600 to 1700 through the explotation of the richest silver mines in the world (Bolivia, Mexico) Spain ruled the world. The spanish peso was the reserve currency of the world and it was made of silver. It was only after 1700 that Spain lost the dominant position to Holland and England after many losses in high seas to pirates, privateers, the equivalent of today tribal raiders. Good try at disinforming about the crucial role of silver in world domination.

  11. All is fair. Certainly no hard feelings from me, not while gold and silver are at these levels!

    I’m simply doing the work of countering gold and silver propaganda, and encouraging people to get on with the business of their lives, rather than stacking metal hoping for a dystopic wealth opportunity which never arrives. The system prevents this from happening.

    To be sure, if gold and silver ever go to the moon, you can celebrate and address me specifically and say I was wrong.

    • Troll, you are liying, you are not here for the good of the people, you are a disinformer paid by banksters/government. The silver reset is months away, your job is that poor people remain poor while JP Morgan amasses illegally the largest silver stack of the last 30 years, the exact thing that will catapult those frauds to unbelievable riches,

    • I think the idea is that one can both prepare, AND keep living, all at the same time. (If done on a long enough time frame)

      I just started preparing some food/water stores. It’s amazing what $500 bucks can do.

      I can still go out to eat from time to time, still see friends etc, still do things that I enjoy doing – but in moderation, so that I can also prepare for a different future, with high cost energy and everything that results from that

  12. OutLookingIn | April 17, 2018 at 11:51 am |

    Steve –

    Your foundational statistics for silver are from the World Silver Surveys, which is a highly suspect organisation under the sway and control of the deep state financials.
    It’s main purpose of existence is to push public sentiment in regards to silver, in which ever direction it’s directed to do so.
    The majority mining of silver being a byproduct of mining other base metals, it stands as the primary source of “new” silver. The largest source being that of copper mining.
    La Escondida in Chile is the world’s largest copper mine. It’s currently running at just over 100,000 tonnes of copper production per month, some of which is the production of byproduct silver.
    Silver scrap does contribute to supply, however it is hardly the largest source. To depend upon questionable statistics from the World Silver Surveys for the “truth” is to lead the believer astray.
    Yet, if all you have to make lemonade is sour lemons, then sour lemonade it is!

    • OutlookingIn,

      While it is true that the World Silver Survey’ data may be inaccurate or faulty, it’s the best we can go by. Furthermore, there are several other organizations that report on the silver market. And then we have the government data.

      That being said, the largest by-product silver comes from ZINC-LEAD, not copper.

      steve

  13. I think someone needs to crack a few more books.

  14. Thankfully, people have kept things civil and Steve has allowed JT to post on this site. I for one become more aware of the issues when debate heats up like this.

    I am now even going back to reconsidering the “heresy” of reconsidering whether there may be actually 8,000 oz of gold in Ft Knox after all, for the reason that certain other central govts are buying up/hoarding gold at a furious pace. They want to keep the price artificially low so that people in US at least are lulled into thinking that gold is worthless, while on the other hand keep the price low so that the sovereign governments /CBs can scarf it up. But NOT because they may want to use it to back up currency in the event of a reset. No! All the central banks/governments are in on the ruse of using fiat money, and all politicians love fiat. I think it is the indirect approach: remove gold from the citizens’ ability to ever acquire enough to establish backing for something like BTC. If there is little gold available for the citizens, then by default they have to resort to local barter or some sort of central bank debt instrument. The direct approach of gold confiscation I think would incite a revolt, kind of like a gun grab violation of the 2nd amendment. Better just to buy up all the gold out there to keep the people from getting any. Paradoxically, gold might not be “worth” that much because there simply isn’t any out there.

    The key is that gold/silver must be widely and freely available to the citizens to the point that enough of it is available that they feel comfortable that there is enough available to act as a form of backing for BTC. The fact that BTCoiners compare BTC to gold or agree even talking about backing it with gold is telling.

    I have wondered whether BTC can ever gain traction because it may not ever be able to be adequately backed by gold since the central banks or govts won’t allow enough gold to circulate in the citizens’ hands to build a foundation of trust BTC needs to get critical mass. On the other hand, assuming everyone has started using BTC, then whether or not gold is “available” to the citizen via allocated civilian depositories becomes less of an issue. More confidence (“backing”) through numbers. It becomes the only show in town, similar to what the US dollar has been worldwide since Bretton Woods. But until then, there is latent fear that gold depositories would be the honeypot for government confiscation. Production via mines could be nationalized.

    In an analogy to the emergence of humans(BTC), they could not emerge until the Central Banks(dinosaurs) became extinct from some catastrophic event. This is why I think BTC and other blockchain decentralized ledgers, or centralized ledgers like Hashgraph, are at risk of stalling out. As long as Central Banks can keep gold out of circulation then the people have no alternative for backing. In fact, sequestration of gold steers people into digital currency (The Trojan Horse theory) something that the CBs like even more because not only is it unbacked x’s and o’s , it can be centrally controlled down to every last byte. BTC for sure is not convenient as currency (takes too long), is not so far a store of value (wild price fluctuations), although may have “security” and anonymity within the ledger itself, certainly has not remained cryptic to those tax payers who are having to pony up capital gains today , tax day April 17, 2018. Citizens are held up at the choke points when they first pay for or sell their BTC into fiat.

    JT’s point about the need to increase gold to increase wealth (productivity) is interesting. People seem to be willing to purchase BTC miner hardware (chips) even while decreasing amounts of unmined BTC available, extreme energy costs, the 2-year lifespan of the mining hardware, etc. The same dilemma exists with gold re increased costs of mining. But to ask the politically incorrect question, is this wealth creation “limitation” such a bad thing at this stage with human population of 7.5 billion people on a finite planet?

    Interesting in a collapse, one could argue that everyone will stampede to sell any asset that might be converted to essentials of food and water and thus theoretically driving down the price of these assets, including gold/ silver like they initially did in 2008. Of course, in 2008 people may have had to sell PMs to raise money to pay off for “non-essentials” like margin calls, thus temporarily suppressing its price. My question is, how much silver and gold is still available in the citizens’ hands to purchase such food and water essentials? Furthermore, I would think that people who are “in the know” realize that initially in a collapse, gold and silver will not be used so much for daily barter and that these people will have already stored up enough food and other supplies. They will hold gold as a way to preserve or transfer wealth after a “reset.”

    A lot of issues to discuss, but one thing for sure, it takes energy for the economy to run the economy, to mine silver, gold or BTC, and put food on our table. The big question is how do we continue to pay for it?

    • Hubbs

      I enjoyed your comment it’s a very complicated issue but it does have som historical context.

      Economy is of course a “dismal science.”

  15. IMHO it all boils down to confidence.
    If you own more food than you need, you have something of value but you also know it will spoil over time.
    Someone comes along needing some of the food you own.
    The question is what will you take in trade for the food? For you to improve your position, you must receive something that will hold its value (not deflate) until you need it, something that will not spoil, and something that is concentrated making it easily stored.

    When folks realize the emperor has no clothes, that in which they have confidence will change.

  16. NOT directly related to this post:

    Commodities including oil, (as well as silver, which it appears is being treated more as a commodity rather than money/currency/investment in this micro-cycle), and a big standout aluminum are surging like crazy in the last few days.

    You keep writing about oil price crash over long term. If possible, please address what exactly is driving commodities & oil price surge in this mini-cycle. Dollar hasn’t exactly tanked on the fiat-trash index, but it isn’t exactly @ a very high level either.

    It appears something very radically has broken in the markets (w/ various geopolitical currency wars raging unabated). Commodity surge usually is an indication of a phase of worldwide inflation. This situation very well might end up being the straw that breaks the back of 5+ years of fraud-misery?! Whatever it is, if there are implosions of some big derivative bets, big corporate loan defaults, I’m all for it.

    At this point, I don’t care if it’s hyperinflation or deflation that defeats the fraud. Just get it going & get it over with. It’s been a very tiring experience to watch this fraud going on for so long.

  17. Saudis driving oil higher for ipo release…they want $80-$100 oil to fund the war effort

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