Top Gold Producers Mine Supply To Fall Right When Potential Investment Demand To Surge

The gold market is setting up for a perfect storm as the top mining producers’ supply is forecasted to decline right when demand is likely to surge.  The surge in gold demand will occur as the broader stock markets roll over and begin their inevitable massive correction.  Due to the tremendous amount of leverage in the system, the coming market correction will be quite violent at times.  If investors believe the correction is over, and high times are here again, then they haven’t learned anything about the cyclical nature of markets.

For example, I have stated that Bitcoin and the Crypto Market are classic bubbles, and wasn’t at all surprised by the collapse of the Bitcoin price from $20,000 to $6,500 in a short period.  However, now that Bitcoin and the Crypto Market have reversed, I see analysis and comments that anyone suggesting that Bitcoin is in a bubble is flat out wrong.  I would kindly like to remind these individuals that markets don’t go down in a straight line.

We can see this quite clearly in the following two charts which came from the article, As Bitcoin Nears $11,000, Here’s A History Of Its Biggest Ups And Downs:

The price of Bitcoin in 2013 surged higher, crashed and then corrected higher before falling over the following year.  The same thing took place in 2013 and 2014:

At the end of 2013, the Bitcoin price surged more than ten times to a high of $1,150 before falling to nearly $500, reversed direction and shot back up to $900+.  However, over the next year, the Bitcoin price trend was lower.

Now, I put this chart together to compare the current Bitcoin price trend with the previous graphs:

As we can see, after Bitcoin fell from nearly $20,000 to $6,500, it reversed and quickly added $5,000.  But, this is exactly how corrections behave, as they did for Bitcoin in the past.  Moreover, the Bitcoin price may move even higher before it starts to sell-off in the longer-run.  Unfortunately, the notion that Bitcoin will continue to endure these corrections on its way to $100,000 or $1,000,000 will likely disappoint crypto investors who are counting on a wealthy lifestyle from their tremendous digital Bitcoin profits.

I realize my opinion on Bitcoin and the Crypto Market runs counter to many followers or a percentage of the Alternative Media.  While a decentralized cryptocurrency seems much more appealing than our present highly leveraged debt-based fiat monetary system, it has degraded to nothing more than mere hype and speculation.  Furthermore, even though blockchain technology offers positive solutions, it can function quite nicely without the highly speculative crypto coin values.  

In a nutshell, blockchain and hashgraph technology can offer useful solutions, however, rampant speculation causing volatile cryptocurrency values are worthless distractions.  Regardless, Bitcoin and the Crypto Market are behaving like classic bubbles and will eventually end up at the same value from where they started.  So, it’s probably a good tactic for crypto investors to consider SELLING THE RALLIES rather than BUYING THE DIPS.

Top Gold Producers Mine Supply To Fall As Future Demand Surges

If we understand that the stock and crypto markets are bubbles, then it can be said that the opposite is true for the precious metals.  Thus, when these bubbles pop, logic suggests that investors will seek the 2,000+ year store of value history of the precious metals.  As I have mentioned in several articles and videos, investors moved into gold in a big way during market turmoil.  The two record quarters of Gold ETF flows were Q1 2009 and Q1 2016.  Both periods had one thing in common, investors panicked into gold because they thought the markets would continue to head much lower.

While the Dow Jones Index fell 3,000 points and has reversed much higher, this is only the first stage of the massive correction and crash to come.  Again, stock markets don’t go down in a straight line.  

If we apply the logic that investors will return to buying gold hand over fist as the markets sell off, they will be doing so right at a time when supply from the top miners declines.  According to Barrick Gold’s yearend results, they forecast production will decrease from 5.3 million oz (Moz) in 2017 to 4.7 Moz in 2018 and even lower to 4.4 Moz in 2019.  In just two years, the largest gold producer in the world is forecasted to lose nearly one million oz of production.

If we look at the top four gold miners past production (Barrick, Newmont, AngloGold & Goldcorp) and the forecast for future supply, the picture isn’t pretty:

What a difference since 2011 when the top four gold miners were producing 20.4 Moz.  In just six years, the combined production from these top gold miners fell by 3.7 Moz to 16.7 Moz.  While the majority of the decline came from Barrick, Newmont and AngloGold suffered production decreases of 700,000 oz each during the same period.  The only miner in the group that experienced an increase in production was Goldcorp.  However, Goldcorp’s production peaked in 2015 at 3.5 Moz and has fallen to 2.6 Moz in 2017.

The problem that all these gold mining companies are facing is the consequence of the Falling EROI (Energy Returned On Investment) of energy on their ability to sustain or increase production.  Moreover, the rapid decline in the gold price since 2012 has destroyed the ability for these gold miners to invest enough capital to sustain or increase production.  This next chart shows the dramatic reduction in capital expenditures (CAPEX) in the top four gold miners:

The combined CAPEX spending for these top gold miners fell from $14.3 billion in 2012 to a low of $3.6 billion in 2016.  That’s a staggering 75% decline in CAPEX spending in just four years.  While it is true that new gold mining projects take a decade to arrive at commercial production status, the rapid decline in CAPEX spending has seriously hurt the top gold miners ability to sustain or grow production.

Unfortunately, the forecast of continued falling mine supply from these top gold producers will take place right at the same time investors will be moving into gold in a BIG WAY.  Thus, a spike in demand will cause the gold price to increase, but it will still take years for these miners to increase production.  Thus, a surging gold price will not impact gold mine supply for years… if ever.

I say, “If ever,” because there is still the issue of the Falling EROI and its impact on the U.S. and global oil production.    I know that sounds insane to say as U.S. oil production hits new record highs, but future production at this level is not sustainable.  I posted this chart in a previous article, and it’s worth looking at once again:

While anti-peak oil enthusiasts are smacking each other on the back pointing to the supposed success that technology has solved the issue of resource depletion and thermodynamics, the tremendous rise of U.S. shale oil production will be a FLASH IN THE PAN.  Another easy way to explain the U.S. shale oil phenomenon is by applying the simple logic…

….. What goes up quickly, also comes down quickly.

Lastly, as the stock and crypto markets correct higher,  they won’t do so forever.  Matter a fact; they will likely correct lower much quicker than investors realize.  Also, while the broader markets are in a bubble, the Crypto market is in a massive bubble.

As investors flee bubble assets, if they are smart and prudent, they will move into gold and silver to protect wealth.  Unfortunately, just at the time when investors are moving into gold in record numbers, the mine supply from the top gold producers will continue to fall.  This is a perfect storm that will cause much higher gold prices for investors who are wise enough to see it.


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55 Comments on "Top Gold Producers Mine Supply To Fall Right When Potential Investment Demand To Surge"

  1. I feel that Steve is right, I just don’t know if I will see silver find it’s true value. Even if the SHTF I see the prices controlled. I keep stacking though be because silver is one of the last under valued assets I can buy.

    • Feel that Steve is right too & when Silver is at $45 I’ll become one of 500+ Patron Supporters.

    • Steve is right when he says that nothing goes down in a straight line. Of course he is referring to Bitcoin when he says that but he conveniently forgets the staggering losses suffered by Gold & Silver investors over the years.

      Silver hit a High of $50 in 1980 and it took 20 years to collapse all the way back to about $4. That’s a loss of over 90% in 20 years. Gold didn’t do that much better and also took about 20 years to reach the bottom and fell about 70%. The miners did even worse with many going to zero.

      That devastation is being repeated now with Gold & Silver hitting highs in 2011 and we now have after 7 years Silver down about 70% and Gold down about 30%. They last great bear market in precious metals took 20 years to reach the bottom so who says they cant fall a lot more yet.

      Beware as Steve’s warning on Bitcoin apply just as much to Gold & Silver.

      • lastmanstanding | February 20, 2018 at 8:26 am | Reply

        None of the fundamental of silver being $50 in 1980 and 2011 have changed. It is more necessary now than ever before. No Ag, no tech.

        Just take your colloidal silver daily…it will keep your hands strong.

      • Some analysts claim that PMs can break up in the coming months. If they fail another several years of bear market awaits us and Steve’s credibility will vanish.

        • Ed,

          Ahhhh… Ed, don’t be so pessimistic, it’s not your style. LOL.


          • I personally think that Gold Silver ratio points to higher PMs prices but after waiting several years PMs holders expect sudden price increases.

        • The peak oil theory sounded good about 15-20 years ago but technology blew it out of the water. So far none of Steve’s forecasts have eventuated. Collapsing oil production, Gold & Silver shortages and price rises are just his unproven theories at the moment.

      • Does anybody know how many dollars have been printed since 1971? (Printed is shorthand for printed or digitally created). I bet they don’t even know. Hell, they lost 21 trillion! The miracle is that it still has any value. And that is all down to confidence that comes from who knows where. My point being, it is pointless to talk about a fair dollar price on real money. The target price for silver is infinity because the paper money will lose all its value over time, slowly or quickly.

  2. Safe to say that we are on the down side of the Seneca cliff of peak gold and silver. When, using a Hubbert type approach, will we hit the tight oil peak or have we already. Hard to tell from your “US Oil Production and Estimated Future Trend”.



  3. As to why I have a Large IRC.ASX position and continue to BUY silver bullion …. its only a matter of time till the house of cards fall down and everyone rushes to the insurance the PM’s give ….JP Morgan knows it

    • For over 20 years Gold bugs have been predicting imminent collapse that is just around the corner. They have also predicted Silver (& Gold) skyrocketing in price along with falling Gold, Silver & oil production. The trouble is none of their predictions have happened.

      Oil was predicted to run out in the 1970’s and regularly there have been predictions of doom and gloom which never eventuated. The great wealth generated by holding Gold & Silver is a myth. It hasn’t and never will happen.

      • And I have had house insurance for decades but I’ve never had to claim ,,,it just never going be used what a waste of $20,000+ dam insurance …many have prediction I’ll need it but NO what do they know

        • Too bad those who invested in Silver have missed out of huge gains elsewhere while they are hunkered down waiting for financial Armageddon.

          • lastmanstanding | February 20, 2018 at 8:30 am |

            “The lure of easy money has a very strong appeal”

            Unfortunately, most of those who have made the huge gains will lose it exponentially…and have nothing in the end.

      • DisappearingCulture | February 20, 2018 at 10:35 am | Reply

        “The great wealth generated by holding Gold & Silver is a myth. It hasn’t and never will happen.”

        It has happened and it will happen again is the fact of the matter, and the only reason it hasn’t yet is manipulation. People know that or they are ignorant. Overall the price appreciation for G & S since year 2,000 is an impressive %. Not as much as some assets manipulate to the upside…for as long as that can last.

  4. “Also, while the broader markets are in a bubble, the Crypto market is in a massive bubble.”

    Please tell me Steve, if the crypto market is in a “massive bubble” then how is it that nobody I know owns any? The crypto sector is barely 500 Billion in total asset value, much less than Apple stock alone, and it’s in a bubble? The debt based fiat monetary system numbers in the quadrillions including the derivatives and dark pool funds. There is the MASSIVE bubble, not in the tiny crypto sector. Coming from the precious metals side, it is so funny to me to see that the traditional PM investors for some reason see cryptos as a threat when in fact they are allies. December 31st will see much higher crypto prices.

    • GLP is exactly correct. I would go one further and argue that all money systems are ALWAYS in a bubble at all times because their only value system is the perceived belief that this same money will buy me goods and services at some point in the future. Dollars, euro, yen, crypto-currencies, even gold. If people did not believe that they could buy futures goods with these items, they would stop accepting them. Gold has the historical advantage, but as we know it is also the easiest to control by TPTB who want to maintain their power and debt based monetary system. This fact should be quite obvious by the world debt levels and the fact that gold is priced barely above production cost. Bitcoin can’t be controlled nearly as easy. One needs to own a bunch of bitcoin to control its price. But by buying/owning it, they will cause a massive price increase because the actual circulating “flow supply” of bitcoin is much smaller than people realize. Steve called a bitcoin top at $11,400 back in December. We have already crashed below $6k and recovered back to his “peak” in a nice steady fashion. If Steve looks at a logarithmic bitcoin chart he will see better pattern recognition, than simply “bubbles” everywhere. While I’ve already stated all forms of money are de facto bubbles, crypto and bitcoin are just getting warmed up. Adoption is still quite small. As a consumer, where would I rather place my trust? Obviously manipulated gold & silver, depreciating fiat, or a money system that is open source and based on immutable math that isn’t easily controlled by corrupt governments?

    • Few buy it cos its too dear. A commodity’s pice is its natural value, assuming that there is a demand for it, in a free market. So why would you pay for something when there are alternatives virtually free or a lot cheaper with little or no downside risk? Bitcoin has only utility value with no intrinsic value. its just a method of exchanging goods and services.

  5. Steve:
    If my calculation are right I have this Gold/Silver:
    Market: $1,346/$16.64 = 80.89
    Cost per Oz: $1,200/$16 = 75
    World Production: 57 times more silver than Gold
    Yield per Ton: 8.61 Tons more for an Oz of Gold than an Oz of Silver.
    So if there is a collapse in Markets and/or Energy what Gold Ratio do you expect?
    Thanks and thank you for all your work

  6. Sell for cryptos here, so we are probably just before a huge rise in the next few days and weeks and new highs could well be made. Cryptos will rise because it looks western TPTB want it as asians continue to s..t on them, again and again and again with no plan, no alternative, nothing as usual !

    • 100% gold/silver, 0% crypto | February 19, 2018 at 11:14 pm | Reply


      Look, we are not stupid. We have seen the relentless pumping of that worthless garbage all over internet comments and forums. We see through the con that they have some “value”.

      Go buy your magic virtual wealth, I wish you all the best. I’m 100% silver and I’m not interested in your flawed arguments and relentless drive to get me involved.


        Now why is that? Maybe because Steve spends so much time bashing them. Plus many PM investors are also now Crypto investors. We haven’t left the metals, we just got bored of them and we like making money. The PM stocks were supposed to be the money train but now that train is in the Cryptos. I still have all my physical metals. Life is short. Make hay while the sun shines.

      • This is known as an emotional reaction, with little rational argument. Most crypto holders here ALSO hold gold & silver. But we aren’t emotionally tied to a single currency, commodity, or wealth vehicle. Nobody is posting referral links or forcing you to buy crypto – and we won’t just get lost. We present an alternative view to the “PMs are the only way” viewpoint. The proof is in the results. You’ve provided no arguments or evidence to support your flawed opinion. Feel free to be left behind as the world changes and crypto slowly takes over many different fields (starting with finance & accounting). The one argument you won’t have is “nobody ever told me about it.”

      • I am in GS and not in cryptos for your information but I note that each article on this site is often published at market reversals.
        Unfortunately, nothing will happen good for GS while the east continue its “strategy” (it means s..ting on them as for example they have talken of oil priced in yuan in shanghai since … 1983 !) as it looks western finance is not keen to buy GS unlike thei have done in the 2001/2011 era.

      • You sound frustrated, and rightly so. I also have a large position in silver but a guys gotta make some doe. I support Steve and I think he does a great job, but to put all your eggs in one basket isn’t wise. At this moment in time crytos make sense…and money.

        • Paul, your comment nicely sums up the bad and dangerous state of the world: “…but a guys gotta make some doe.” “At this moment in time crytos make sense…and money.” Similar comments and sentiments from other replies.

          THIS is what we have become accustomed to and trained to do: throw some $ in a get a whole lot more out without working for it. How long this goes on for is anyone’s guess, but it is not sustainable. Some people will make $ but those holding at the end will not.

          How about people do some real work and then put those $ away? Nah, too hard. This will lead to the downfall of society and most people.

          Also, gold vs crypto – one of them is only a pretend asset with ZERO real value. How’s that for evidence of my “flawed opinion” Mr SD?

          • Hey I totally agree with you, but how long am I supposed to sit on PM? You truly do have to make it when you can. I seriously doubt most crypto are any kind of long term play.
            As for the poor guy holding in the end, that goes for ANY asset, whether it’s housing, stocks, bonds, dollars, whatever…

          • When did I suggest people not do real work? The question isn’t whether to do real work or not, the question is what is the best investment vehicle to save one’s extra wealth (after expenses)? PMs are good, but what else? To have a 0% allocation to crypto seems narrow-minded to me, especially as we are on the very early end of the adoption S-curve.

            Your issue is that you see no value in a trustless, decentralized, immutable, censorship-resistant, triple-entry accounting monetary system like bitcoin and you assign it zero value – incorrectly. It obviously has value. The only question now is, what value does it have? That is for the market (not politicians and banksters) to decide, as it OUGHT to be. In a world where governments are vying for more and more control, decentralization and censorship-resistance are becoming more and more important. I am not calling bitcoin an asset. I am calling it the purest form of currency ever invented (and it is) for a modern digital age. Choose to ignore these features at your own peril.

  7. I think cryptos are maintaining price range simply because there are no alternatives. Stocks, bonds, real estate etc in bubble, and the reverse for Ag and Au which are being suppressed to the point that they are as appetizing as cardboard. Hence cryptos are the “only show in town” by default, but also by their novelty, and as people begin to understand central banks’ fiat currency creation and fractional reserve lending treachery, are providing a sort of blind exit or escape from Central Banks. But unfortunately, this exit may lead to another quicksand trap.

    Ultimately, it would intuitively seem that cryptos should not command any more premium than the what a vendor pays for VISA or MASTER CARD…, i.e a currency with some benefits that make it better than using as physical gold or silver in day to day transactions, but not more than that to imply it as a something with tangible value. There is no other inherent value other than as a medium of exchange, and if no backing, can never hope to replace gold or silver as a store of value in the long run. The idea of “perceived value” is different than the actuality of a “store of value. ” In the short run, cryptos have “perceived value”, but “store of value” implies long term. The word “perceived value” by itself only reflects what someone else is willing to pay for something at the current moment.

  8. IMO we are on the edge of a paridigm shift mainly because of the EROI of everything.
    Cryptos are new with very short history. Mkts are moved by emotions, value is replaced by confidence.
    It will be very difficult to make future predictions based on historic actions.
    Questions must be pondered about what is needed to survive this mess we are in.
    I feel the future holds a need for a reliable store of wealth (PMs) and a reliable means to move this wealth for commerce.
    Anyone who rejects the attributes of the blockchain seems to be supporting the continuation of govt controlled printed fiat currencies.

    • Good answer!

    • 100% gold/silver, 0% crypto | February 19, 2018 at 11:27 pm | Reply

      “Anyone who rejects the attributes of the blockchain seems to be supporting the continuation of govt controlled printed fiat currencies.”

      olegig, IMO that was not a wise comment. a government can regulate/legislate my pets, my trees, my house, my body, my ability to get married or divorced, my assets… anything at all they want… and yet you think that a blockchain is out of their control? naive. they will again own “the” blockchain they choose and destroy those they don’t. only hard assets in your hand and out of their reach is truly yours.

      • Evidently you don’t remember the past. They can also regulate your “hard assets” and pay you pennies on the dollar for them. I’m not saying every crypto is good, but there are real companies tied to these things. Most will go away, but some will surely be here in the future.

        • That’s why unfortunately our only hope is chinese oligarchy which could have interest to push gold use. That does not mean in such case the western TPTB would not strike back.

  9. Great analysis. This perspective is very U.S. centric and shows us what I consider to be a declining gold and silver trend that can be applied on a global basis. If you take the same logic and apply it toward nations with a high population that also have an affinity for gold and silver…like China and India. We have a problem that is magnified 20x. Instead of 300 million people clamoring for gold and silver we can add an additional 2.3 Billion. My understanding is that China is the largest global producer of gold as well as the largest consumer of gold. In 2013 I read an article that stated China had 5 years of gold reserves if they continued to mine 400 tons of gold annually. Well here we are in 2018, and what do you know? China’s gold mining has started to decline. So what happens when over 2.3 Billion Chinese and Indians want gold and are no longer able to source it. Ummm…upside potential is unlimited.

    • Agree.
      I hope then the governments don’t try to outlaw PM for the “common good” LOL

      • A tired and nonsensical fear. I could go into a list of reasons why outlawing gold and silver would never happen, but I’d be wasting my time. Instead of fearing for its own sake, Go research the Soviet Union if you want to know what really happens when governments collapse

  10. It’s been 10 years now! How much longer do we have to wait?? btw you were wrong on Bitcoin Rocco.

    Elliot wave chart pattern recognition has Gold falling to $777? No! Im not harry dent!

    • Sounds like you’re referring to this chart: DQmfMLpKZwFxjAUp75XZr6CGkyC2TUcDqBtbWsZ1UgKM2YQ

      Under normal market circumstances I would agree.

  11. I personally accumulated gold, but I’m done. I’m not accumulating anymore, I don’t care what the price is.

    I do exist! We are out here, folks, and we are disappointed. Life is short, you cannot keep waiting forever. If that was the case, I should save a dollar a day so I have 3650 lousy bucks ten years from now.

    You people are looking too far out into the future. By the time your predictions come true, everyone reading this post is going to be pissing themselves in a nursing home.

    • dolph,
      At least while we are going for a swim in the nursing homes, our grandchildren can stay warm and feed.
      It’s been said that tightwads make great ancestors.

  12. From what I read on a oil industry website recently is that the glut of oil on the markets will disappear this year regardless of US output. Higher prices are coming soon. I think the gas tax idea is a way for them to reduce demand and the infrastructure idea is just a cover or they want to do both and just not talk about reducing demand. They just want to delay a increase in the oil price.

  13. Steve,

    I don,t know about the eroi of this frozen methan gas but there is no drilling needed and the reserves are globally absolute massive. We are no way even close to the end of the fossile fuel era.

    • Pieter,

      Methane Hydrates will never be commercially viable. Here is a brief quote on the EROI of Methane Hydrates:

      There are only two studies on EROI, both by Callarotti, and he looks only at the heat energy used to free the clathrates up, and it’s published in a journal called Sustainability that would better be named Gullibility when it comes to the topic of energy which is not their specialty. He comes up with an EROI of 4/3 to 5/3 using just that one parameter. Callarotti knows this is a dishonest figure because he says “If one were to consider the energy required for the construction of the heaters, the pipes, and the pipe and the installation process, the total EROI would be even less.”

      If you want to read more information about the complete waste of time extracting Methane Hydrates, check out this article:


  14. I think many people have bought gold for the wrong reasons. Gold is nothing more than a stop of wealth. In the long run Gold will always hold its value IMHO. As far as when will it go back to $1900? We have to be patient my good brothers. We need to remember that it took until 1954 for the stock market to again reach its 1929 high levels. Best to all.

  15. My question is how representative those few big gold producers is to the hole industry?
    When I started to follow this industry a few years ago the yearly world gold production was about 2700t/y. Now it is 3000+.
    Eaven that it now seams to topping out it don’t fit the production profile of the five big.
    What is that i am missing here?

  16. Hi Steve,
    I have long been an admirer of your work focusing as it does upon our energy predicament.
    I also make a small monthly donation to your blog or at least I hope I do.
    Firstly, I am precious metals investor/stacker.
    I am also an investor in crypto. What a sucker I hear you say.
    The crypto world is still in its infancy and I am not happy with the huge amount of speculation going on. However, crypto is not just some speculative fad that will disappear as you suggest.
    Many of these digital assets have real world uses and are indeed being used in the real world.
    Look at Ethereum. The Brazilian government has succumbed to public pressure and is developing an app that will run on the Etherum blockchain. This app will be used by citizens who want to sign petitions that will go to the congress for discussion.
    I could run off a list of cryptos that are being used now in the real world and many that will come online this year.
    Have you studied any of the whitepapers produced by the creators of these coins/tokens?
    If not read the bitcoin whitepaper by Satoshi Nakamoto.
    I don’t believe gold or crypto will ultimately save our civilization from collapse as it based on the premise of infinite economic growth on a planet with finite resources.
    You should look at the work of Professor Tim Garret of Utah Univeristy whose calculations show that our civilization is headed towards collapse or read the blog of Professor Guy McPherson of Arizona University or the work of Derek Jensen. You must be aware of Kunstler’s work which suggests the same thing?
    Gold will not save us. It mght help a small number of people weather the next financial storm
    but it won’t solve the contradiction central to our civilization.
    Sit back and enjoy the ride while it lasts.
    Kind Regards
    Dr.Dylan Murphy

    • Dr. Murphy, “…I don’t believe gold or crypto will ultimately save our civilization from collapse as it based on the premise of infinite economic growth on a planet with finite resources…”

      There are two statements here, let’s break it down: first, you said that gold/crypto is “based on the premise of infinite economic growth” – I’d like to hear exactly how you can explain that. As I see it, fiat debt-based currency is the root cause for the mandatory growth paradigm, not gold or crypto. Secondly, you say that gold or crypto will not save our civilization from collapse based on the premise that I am questioning. If, in fact, gold and crypto are NOT based on some kind of infinite growth mandate then the claim that they won’t save civilization is false – but that said, nobody was claiming that gold/crypto was going to do this anyway.

      thanks. JR

      • Good comment Dylan

        Evidently some remain unaware of the persistent need for growth. As perverse as it may sound the elderly need to feed off the young. That’s capitalism. The pure function is that through ownership the next generation serves the previous. With enough growth the social contract is extended. Once growth ends the contract ends. Is this so hard to understand?

        Gold silver crypto are all foolish relics trying to stand in for a lack of growth. Can’t plant them or eat them. Energy is king whoever can control and peg their currency to it is king.

        So growth = Order. No growth = Disorder. Sorry to burst anyone’s steady state theory. Including gold and silver bugs.

  17. Steve, I understand that many mining companies hold onto stockpiles so that they can quickly
    meet increasing demand or produce metal from their reserves of partly processed ore when prices increase. Please can you research this subject – both gold ore and unrefined bullion stockpiles. Do major mining companies publish their quantities?

  18. maga the Don is a dreamer and the reality is all to clear to see as the empire of
    conquest needs to invade and stay in the middle east to get his hands on lots
    of oil and gas which he will not buy clearly.

  19. Reading comments it seems more and more are doubting the forecasts made by Steve. Its not surprising as if you look at his predictions you see none of them have happened.
    Oil prices haven’t collapsed to $30
    Gold & Silver demand hasn’t surged.
    Gold & Silver prices haven’t surged either.
    Oil companies haven’t gone broke.
    Its all just forecasts based on his theories which are totally unproven. How many years do you give these theories before they are tossed away in the dustbin of history.

  20. Steve, off topic but there is an amazing article linked to by Ilargi at Automatic Earth today that, I think, is right up your alley, and has really serious implications. The author analyzes the projected treasury issuance and asks who is going to buy all of the new debt. Kind of like your energy company wall of debt
    but for the U.S. Gov.

    You need to see his charts and complete article to get the full impact, but his conclusion:

    “So, I’ve shown US federal debt is surging but the only thing keeping the US economy “growing” is the size of the deficit and debt incurred. I’ve show the traditional sources of net Treasury buying have ceased except for the domestic public. That the Intra-Governmental holdings are essentially peaking and will be a net seller within a couple years and all new debt issued will be “marketable”. I’ve shown the Federal Reserve plans to “roll off” approximately $250 billion a year for up to four years. I’ve shown that China ceased net buying Treasury debt in 2011 and foreigners have essentially gone on strike since QE ended. The only real foreign bid remaining is from some pretty shady demand that looks an awful lot like it could be central bank buying, but regardless the BLICS, foreign demand for Treasury’s (on a net basis) has essentially stopped.

    This leaves the domestic public to purchase all the surging new issuance, plus the portion the Fed (and soon enough, the IG) is rolling off, and with little to no assistance from foreigners (even the possibility the strike turns into an outright selloff!?!). The domestic public currently holds about $6 trillion in Treasury debt and will need to buy in excess of $1.5 trillion annually (indefinitely) between picking up the roll off and the new issuance. If the public “willingly” do this at low interest rates, it will represent 7.5% of GDP going toward Treasury purchases that yield well below needed returns. If the Public don’t do this “willingly”, interest rates will soar far more than shown above and the US will be overwhelmed by debt service. The only other option is that the Federal Reserve makes a U-turn to re-start QE and openly engage in endless monetization.”

    A must read, IMO:

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