While the surging gold price has received most of the spotlight in the market, silver will outperform the king monetary metal over the longer term. Key fundamental factors make silver the more attractive asset and investment to own versus gold when we look closely at the data. However, that doesn’t mean precious metals investors shouldn’t own gold. Investors need to own both precious metals, but I believe silver will provide better returns than gold in the future.
Now, there is this notion put forth by many precious metals analysts that central banks will be forced, at some point, to back their currencies by gold. Thus, the idea is that gold will reset at a much higher price. While that is a possibility, backing debt-based currencies with gold will not solve our coming energy crisis. And, let me tell you, it’s an energy predicament that we have no real solution.
You see, it doesn’t really matter if we back fiat money with gold. The REAL ISSUE has always been ENERGY. The massive increase in debt and derivatives are a symptom of the Falling EROI (Energy Returned On Investment) of oil. Basically, while gold may solve certain issues in regards to “Confidence” in money, it doesn’t fix our energy problems.
I touched on this briefly in my newest video, Why Silver Is Better Than Gold. However, most of the video explains new charts that show fundamental factors on why silver is a better investment than gold as well as some key price levels for the short term.
One of the more important charts in the video shows the amount of “Identifiable” physical gold and silver investment stocks. Interestingly, according to the data from the World Gold Council and the World Silver Surveys, there is just about the same amount of physical gold investment as there is silver.
These official sources estimate there are about 2.4 billion ounces of gold and 2.45 billion ounces of silver held in public and private vaults, including central bank holdings. Yes, there is likely a great deal of physical gold and silver held by investors at home or in secret vaults that are not included in those figures. But, these amounts still wouldn’t change the values of these metals all that much.
For example, even if we assume, there might be another 2.5 billion oz of physical silver investment held by investors, that would only increase the value of the total physical silver investment to say, $100 billion. Still, a drop in the bucket compared to the over $465 trillion in Global Real Estate, Bonds and Stocks.
I have included several new fundamental charts in the video on why silver will outperform gold on the longer-term basis. Also, some updated silver price charts show where I believe are the next important levels for silver.
Lastly, I wanted to thank everyone for subscribing to the SRSrocco Report Youtube Channel as I now have over 10,000 subscribers:
As I mentioned, at the beginning of the video, I said that I also post Oil and Energy videos on the SRSrocco Report Youtube Channel. Precious metals investors need to watch and understand these energy videos. Why? Because, the world is about the hit an ENERGY BRICK WALL and that is bad for 99% of assets held in Stocks, Bonds, and Real Estate.
Unfortunately, a significant percentage of my precious metals followers don’t pay much attention to my energy articles and videos. But, I have also found that most of the individuals in the energy industry that I communicate with, don’t really care about precious metals. And worse yet… the Financial people could give a rats ass about energy or precious metals.
This is the problem of being TOO SPECIALIZED and not OPEN-MINDED.
If you start to look at my past energy articles and videos, you will CONNECT-THE-DOTS on why energy is the number one driver of the economy and why it will negatively impact most stocks, bonds, and real estate. However, what’s terrible for most assets will be good for the precious metals, especially silver.
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Thanks for all the excellent info you provide. However, I wonder if you have become overly focused on EROI. For example, see the article “The US is about to send a lot more oil into an already oversupplied world market” at https://www.cnbc.com/2019/08/27/the-us-is-about-to-send-a-lot-more-oil-into-an-oversupplied-market.html . On the one hand, you’re right to warn people about the bad economics of shale oil. However, for the next 3 years, energy is NOT going to be a problem, unless there’s a major war involving big oil producing countries. The US increase in oil production may not be economically sound, but it will happen over this… Read more »
My theory is that for now, the debt is driving the shale oil drillers to pump like mad to remain solvent. This means the shale oil supply, which accounts for the majority of “newly discovered oil” as the traditional deep well supply plateaus, will be exhausted at an even faster pace. The extra sugar high of shale oil supply only encourages more waste, leads to more complacency. So we’re burning the candle at both ends as the debt accelerates the demise of the shale oil industry.
Nick]222
There is a difference between quantity of oil in the marketplace and the average EROI of that oil. But I think you realize that. There is also a distinction between economically sound or profitable, and EROI. Debt may be a fatter “black swan” coming to roost sooner…and there are others.
I think the globalists want the US to dump a lot of this oil on the market to drive oil prices lower for multiple purposes. One purpose would be to extend this global financial ponzi scheme further since much of the global economy cannot handle higher oil prices due to the huge amounts of debt. Another purpose would be to put the hurt, or at least, try to put the hurt, on some of their oil producing enemies, such as Venezuela, Iran, Russia. I doubt it’s hurting Russia that much. How this plays out in the near term is still… Read more »
if I may, I find this guy`s theory similar to yours and very plausible….
https://www.youtube.com/watch?v=26AIReJniwc&list=WL&index=38&t=0s
Excellent video posted above.
Great stuff Steve. I agree with you Nick)222 that the world’s oil situation will be OK for the next 3 years. We also have to keep in mind that Shale Oil is mostly very light(high API), good for making gasoline but not diesel or jet fuel. BTW I enjoy the comment section as I enjoy reading thoughtful and intelligent replies. Thanks
The Tail Still Wagging the Silver Dog. Since the beginning of 2018, the Comex has transmitted to the LBMA it’s silver delivery obligations in the form of EFP’s Exchange of Futures for Physical. During the first six months of 2018, these EFP’s accounted for 47,031 tonnes of silver. The total world mined production of silver in ALL of 2018 was 27,000 tonnes. Now, if the LBMA had ALL of 2018’s world silver production of 27,000 tonnes to sell, it would still come up almost 50% short of filling these EFP’s for just the first half of 2018! How can this… Read more »
I think October may the month precious metals spike well. This is just not a good month for stocks and if you’re superstitious, this Oct is the 90th year anniversary of the 1929 stock market crash. The only thing supporting stocks seems to be tweets anyway. Those billionaires have got to catch on to silver soon. $45 billion in silver is a ridiculous amount, buy while on sale!!
Great informative work, Steve!!!!
Always glad to get a healthy dose of sanity and logic. Thermodynamic Collapse rages on.
Hoping not to miss “The Seneca Cliff” as the latter end of this will find this family in Northern AZ raising lots and lots and lots of cattle.
I see silver has cracked the $18.50 resistance line. May not close above it, but it’s progress.
Yes, breaking through $18.50 is a good sign, however it must hold above there and close out the week and month at that level, to be validated.
The next big hurdle for silver is $21.00 the last time it touched here was over 3 years ago, June 2016. After that comes the biggest wall at $24.60, a jump here would turn silver loose to the old all time high plus.
I once had a gold coin but got rid of it because I thought gold was going to increase in value by only just a little bit compared to silver. I only buy silver and nothing else. Every week when I get my pay check I get a minimum of 2 ounces. It may not sound like much but over a year it’s 100 ounces and that is much more than 99% of everybody else. The days of $10,000 silver is coming.
I’ve just viewed your video, on the fourth of September Australian time, and I’m Amazed by how accurate your forecast was, however, if anything, you underestimated the time the price of Silver would range trade at around $18 50, and no real pull-back from that price range
Hey, I’m not critical, I’m surprised just like you. 🙂
Yesterday afternoon, Australian time, I noticed the price of silver steadily climb up to $19, and when I woke up this morning, it was nudging $19 50, which is one whole dollar, in less than 24 hours!
Keep up the good work…