Bank Runs Imminent Based on Slew of Bank Failures. Silver Set to Double in 2025!

Mathematical Reality Fuels Precious Metal's Surge.

The US dollar lost its direct gold backing in 1971 and is now a fiat currency

Fact 1: The US Gold Reserves are reported to be 8,133.46 tonnes, equivalent to approximately 261,485,550 troy ounces. At the current gold price of $2,662 per ounce, the total value of these reserves is approximately $696 billion.

Fact 2: The US national debt has grown exponentially since 1971. As of December 6, 2024, the total federal government debt stands at $36,167,364,938,108.44. This represents an increase of about $2.3 trillion in fiscal year 2024 alone

Fact 3: The ratio of US gold reserves to national debt is currently very low. Based on the current debt and gold reserve figures, the gold backing ratio is less than 1.9%

To achieve full gold backing of the national debt, the price of gold would need to be significantly higher than its current market value.

To calculate the fundamental value of gold needed to pay off the current US national debt:$36,167,364,938,108.44 (total debt) ÷ 261,485,550 (troy ounces of gold) = $138,315.76 per troy ounce

This calculation shows that if the US were to use its gold reserves to fully back its national debt, the price of gold would need to be approximately $138,316 per troy ounce.

This theoretical value is significantly higher than the current market price of gold, which is around $2,662 per ounce.

This extreme disparity between the current gold price and the calculated value needed to back the national debt highlights the magnitude of the US debt relative to its gold reserves.

Fact 4: The current fiat currency system relies on the ability to create debt and increase the money supply. This system has led to concerns about the long-term sustainability of fiscal policies and the potential for currency devaluation. The Congressional Budget Office projects that the national debt will grow to an astonishing $54 trillion in the next decade, driven by an aging population, rising federal health care costs, and higher interest rates.

Implications for the Future

The rapid increase in national debt has significant consequences:

Interest on the debt is projected to be the fastest-growing part of the federal budget over the next three decades.

To calculate the daily interest amount on the $36.2 trillion national debt using the federal funds rate, we need to consider the current federal funds rate and perform some calculations.

As of December 2024, the federal funds rate is approximately 5.33%. However, it's important to note that the interest rate on government debt varies across different securities and maturities, so this calculation will be a simplified estimate.

Here's the calculation:

1. Annual interest: $36.2 trillion × 5.33% = $1.93 trillion

2. Daily interest: $1.93 trillion ÷ 365 days = $5.29 billion per day

Therefore, the estimated daily interest amount on the $36.2 trillion national debt, calculated at the current federal funds rate, is approximately $5.29 billion per day.

The growing debt poses risks to America's economic standing in the world and threatens long-term fiscal sustainability.

The deficit is expected to average $2.2 trillion annually over the next decade, potentially pushing the debt held by the public to nearly $51 trillion or 122% of GDP by September 2034.

These trends underscore the urgent need for fiscal reform and responsible economic policies to address the challenges posed by the rapidly growing national debt.

What about Silver?

---

The global above-ground supply of precious metals reveals an intriguing disparity. While there are approximately 6.8 billion ounces of gold available, silver's above-ground supply is surprisingly limited at less than 4 billion ounces.

This makes silver twice as rare as gold in terms of accessible reserves.

Furthermore, the annual mining ratio between these metals is equally noteworthy: for every ounce of gold extracted, only 8 ounces of silver are mined. This 8:1 mining ratio contrasts sharply with the current market price ratio between gold and silver, which often exceeds 75:1. Today the Gold to Silver ratio is over 83.

Given silver's relative scarcity above ground and its limited mining output compared to gold, one must wonder: Where is the gold-to-silver ratio headed in the future? Could we see a significant correction as the market recognizes silver's true scarcity?

---

Just two days ago I told you all the Gold to Silver ratio was breaking out favorably in Silver’s favor. Look for this trend to continue sending Silver skyrocketing.

Invest accordingly.

Bank Runs Imminent Based on Slew of Bank Failures

The current financial landscape presents significant challenges. Banks operate without reserve requirements, while commercial real estate faces vacancy rates up to 40% or higher in major markets. This potential loss far exceeds the 2008 subprime crisis, posing a severe threat to bank stability. Simultaneously, war spending continues to grow, straining financial resources.

Depositors should be aware that their funds are essentially unsecured loans to banks, which are experiencing liquidity issues and restricting transactions. The concept of "security entitlement" means individuals may not truly own their IRAs, 401(k)s, savings, or even homes. This legal framework, along with the DTCC's role as a collateral pool, could be used to protect banks from their massive derivative exposure, estimated to exceed one quadrillion dollars.