Sub $20 To Collapse Markets & Push Precious Metals Prices Higher

The U.S. and world markets will crack in 2016.  This will be due to the extremely low price of oil.  There is a possibility that oil will drop below $20 as storage levels increase towards capacity in the United States.  Already oil storage at Gulf Coast and Cushing, Oklahoma are at 85% capacity (source).

I sat down with Kenneth at Crush The Street and discussed how the low price of oil will be the factor that sends the U.S. and world stock markets lower in 2016, while pushing up the values of the precious metals.  This is a very strange situation as history has proven that gold and silver tend to increase with a rising oil price.  However, the falling oil price is destroying energy and commodity producing countries and their currencies.

Investors worried about the continued decline of currencies throughout the world are finding precious metal investment as a safe haven.

Here is the interview below:

You can also find the interview at Crush The Street.

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12 Comments on "Sub $20 To Collapse Markets & Push Precious Metals Prices Higher"

  1. While I 100% agree with all your annylisis Steve, I’m thinking that statements like, “The U.S. and world markets will crack in 2016.” go too far. It seems to me that TPTB are mighty good at pulling rabbits out of their hats and I’d bug me if peeps help up that statement as proof you are some tin foil/oil hat type guy.
    Any way it was a great interview and Kenneth is coming right along as well, adding a lot of content these day which I also very much appreciate.

    I still fully expect supply problems for investors trying to add Phyzz Silver going forward beginning here at the end of Feb…and fully expect Mint allocations to begin biting stackers hard— in March with a dramatic rise in premiums….so much so, that by 4th of July spot and premiums will be equal and by Labor Day premium will exceed the spot price on Mint items…..and ‘Numismatic Value’ will shock buyers on even Maples and ASE’s…even only 4 or 5 years old.
    Stackers are going to see with their own eyes that—- the Silver in their own hands…. Spot, + Premium + a Numismatic value, will add up together to make it tough to hold their water!

    • You say TPTB are good at pulling rabbits out of their hat [holding up the deep state and the status quo], and you cast doubt on the markets cracking in 2016.

      But you think there will be a massive silver shortage “….so much so, that by 4th of July spot and premiums will be equal and by Labor Day premium will exceed the spot price on Mint items…”

      From thinking about these topics for a long time I don’t think S or G can go up a lot measured in fiat valuations without there being a concomitant collapse in Western stock market indices. If PM’s go up a significant amount it will collapse western stock markets. If stock markets collapse first that will cause a massive rise in PM valuations.

      When you see rises in PM prices they can’t smack down with paper contracts; buckle your seat belt, the ride is getting rough.

  2. I’d appreciate an update on the profitability of PM miners. Thank you.

    • Markus,

      Yes, I saw you request this in a prior comment-email. Unfortunately, it takes a lot of time to put together the Quarterly spreadsheet and the site really isn’t generating the revenue to make it worth my time. So, I am rethinking the future of the site.

      I receive a lot of emails telling me that I put out some of the best material and facts on the precious metals on the internet. However, only a few people have donated… which I really appreciate.

      So, I am now talking with some other folks and considering some changes so I can spend more time writing and offering more material. However, it will likely be PAID PREMIUM CONTENT.

      I will keep you informed.

      steve

      • I loved your paid silver guide Steve. Waiting for you to release more. Don’t stop publishing. Start charging instead.

      • Well, I was one of the guys who donated, and bought your paid report. I can totally understand your point of view though.

        I can only say, if there is paid content from you on the topics of PM supply and demand, and/or energy, I am sure to buy.

  3. Steve made an excellent comment (I think aroung the 20:00 mark): financial, paper assets are valued based on NET PRESENT VALUE, which of course assumes a certain interest rate that one then discounts. The point is that when you buy a share of XYZ corp, not only are many of the accounting numbers often manipulated (to minimize the corp’s debts and make it look better on paper), but the paper value is NOT intrinsic and depends on net present value of future cash flows. Precious metals have NO counter-party risk so they are a far superior store of value: their value, yes in the short term it’s manipulated in the futures market by paper trades, but in the long term they represent a real asset, for which there is growing demand, and less supply due to rising costs of production (it takes X tons of rock to produce Y oz of metal which means real costs in energy required to extract the metal).

  4. Well it’s finally happened. Your celebrity has turned you into a prognosticator. I thought you
    mentioned to me one time that you don’t make predictions. You are supposed to be a peak
    oil guy. Now you say when the market crashes. Your error now follows guys like Shiff, Morgan
    and Butler. Oil may get to $25 but by year end it will be in the 40s. And the market, which will be
    a safe haven will rise in value. As the world economies begin to collapse the rich will invest in
    the USA. As a nation of many corporations we assuredly are too big to fail. Guess again Steve.
    Silver is still not money to 99% of the world and until demand exceeds supply, silver will languish.

    • Conjecture on your part. Your scenario is a prognostication. Perhaps mine below is, but I am using may and might rather than will be.

      Oil has to rise but it it likely to drop farther; who knows how much. 25 would be a huge % drop from where it is. The stock market indices seem to be tracking oil now, and I’ll label that as a type of sentiment. Markets will likely be elevated with the next round of QE, but they may be elevated from a crash position compared to where they are now. We are not too big too fail.
      It doesn’t matter if people consider silver as money…If they are buying it and demand exceeds supply to the point of serious deficit, and it is heading there. I’ve been saving silver since 1964 and I really rarely think of it as money. That’s because it isn’t circulating as money in my life.

      Here is some more perspective; under the heading of gold it is mentioned that silver is the key
      to both G & S http://investmentresearchdynamics.com/in-gold-we-trust-cnbc-asias-bernie-lo/

      • My prediction was a scenario.The FED is using digital money. They didn’t have 4 trillion
        dollars to buy all the debt they bought. The treasury surely didn’t print that much money. Every time a credit card is used money is created but dollars aren’t printed. My point is the same. Demand is the answer to rising silver prices. And think of what you are saying. What is the USA if it is in “failure” mode. Chaos, wars, no food, etc. A Ferguson in every town in the USA. What good is silver under that scenario. I walk out of my house with 5 ounces to buy “what?” How far will I walk before I’m mobbed and robbed. There will always be a USA. That’s what I mean about 2 big to fail. This talk of collapse is doom and gloom like Stanbury, Dent. Our dollar may collapse by 50% or more over time and be like the Peso. All you need buy is a wheelbarrow.

  5. For those that think the equities markets are poised to go higher, I say it wouldn’t take much to trigger a crash of these markets. For example impending debt collapse of U.S. oil defaults.

    http://www.bloomberg.com/news/articles/2016-02-25/biggest-wave-yet-of-u-s-oil-defaults-looms-as-bust-intensifies

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