Gold Prices are up 16% Year to Date While Silver is up 41% since January 2024. Both are Just Getting Started as Recession is Well Underway all Within Rising Inflation.

The Scariest things are when you have a Recession inside an inflationary environment. Never listen to CPI. Real inflation is north of 15% and rising

The Silver Academy

Jul 08, 2024

Chart of the Week

Traders boost their bullish bets in Gold on Comex
On call $2,400 expiring in 17 days (Aug'24 contract)
Open interest shoots to 6,897
From a baseline 3,000 just 60 days ago
So, the increase from 3000 to 6827 is approximately 127.57%
Volume spikes to 5,213 within 90 day average of 630
So, the increase from 630 to 5213 is approximately 727.46%

India's gold purchases in June were the highest in 2 years.
The Reserve Bank of India added more than 9 tons in June
The most since July 2022.
India’s gold reserves have expanded by 37 tons this year to 841 tons.
Meanwhile, gold prices have rallied 16% year-to-date.

“The gold price is being set in Shanghai, and the Chinese are huge gamblers. They love gambling. And I think the Shanghai Gold Exchange could become a casino where they’re going to gamble. Under that scenario anything can happen. $18,000, $19,000 gold could happen. - Pierre Lassonde:

end of section

Silver is up 40.91% since January 2024

To calculate the percentage increase from 22 to 31, use the formula:

So, the increase from 22 to 31 is approximately 40.91%.

end of section

Panic Short-Covering Ignites COMEX Copper as Shipments Fail to Arrive

Short-Covering Surge: COMEX copper prices experienced a significant increase due to panic short-covering. Traders who had bet on falling prices rushed to cover their positions.
Shipment Delays: The surge was triggered by delays in copper shipments, causing concerns over supply shortages.
Market Reaction: The unexpected shipment failures led to a scramble among traders, pushing prices higher as they sought to mitigate potential losses.
Supply Chain Issues: The delays highlight ongoing supply chain issues affecting the copper market, exacerbating price volatility.
Impact on Prices: The immediate impact was a sharp rise in copper prices on the COMEX, reflecting the market's sensitivity to supply disruptions.

The global copper supply is ~~can be characterized~~ (very similar to Silver story)

- limited high-grade deposits
- and increasing environmental concerns impacting production.
- soaring demand

The current state of copper deposits worldwide and the impact of Panama's recent decision to close its copper mining operations:

Limited Copper Deposits Worldwide

Finite Resources: While copper is relatively abundant in the Earth's crust, high-grade deposits that are economically viable to mine are becoming increasingly scarce.
Concentration of Reserves: A significant portion of the world's copper reserves is concentrated in a few countries. Chile holds the largest share with 21% of global reserves, followed by Australia (11%) and Peru (9%).
Declining Ore Grades: Many existing mines are experiencing declining ore grades, meaning more material needs to be processed to extract the same amount of copper, increasing production costs and environmental impact.
Exploration Challenges: New copper discoveries have become less frequent and more expensive to develop, often located in remote or politically unstable regions.

Impact of Panama Closing Copper Mining Operations

Panama's decision to close the Cobre Panama mine, operated by First Quantum Minerals, has significant implications for the global copper market:

Supply Reduction: The closure removes approximately 300,000 to 350,000 tonnes of annual copper production from the global market, which is about 1.5% of the world's copper supply.
Market Tightening: This reduction in supply is likely to tighten the copper market, potentially leading to higher prices in the short to medium term.
Environmental Considerations: The closure was primarily driven by environmental concerns and public opposition, highlighting the growing importance of sustainability in mining operations worldwide.
Precedent Setting: This decision may set a precedent for other countries to scrutinize and potentially restrict copper mining activities based on environmental grounds.

Broader Implications

Supply-Demand Imbalance: With global copper consumption projected to rise by about 24% between 2023 and 2033, reaching approximately 32 million tons annually, the closure of major mines like Cobre Panama exacerbates the challenge of meeting future demand.
Energy Transition Challenges: Copper is crucial for the energy transition, with "green" sectors expected to double their share of global copper demand from 8% to 16% over the next decade. The closure of mines could hinder progress towards clean energy goals.
Investment Uncertainty: The Panama situation may increase investor wariness about large-scale copper projects, potentially slowing the development of new mines needed to meet rising demand.
Focus on Sustainable Mining: The closure underscores the need for mining companies to prioritize environmental stewardship and community relations to ensure the long-term viability of their operations.
Recycling and Alternative Sources: Limited primary copper supplies may accelerate efforts to improve copper recycling and develop alternative materials for some applications.

The closure of Panama's copper mining operations, while significant for environmental protection, adds pressure to an already constrained global copper supply.

This situation highlights the delicate balance between meeting the growing demand for copper, especially for clean energy technologies, and addressing environmental and social concerns associated with mining activities.

It also emphasizes the need for more sustainable mining practices and increased investment in exploration and development of new copper deposits to meet future demand.

DeathStrike to Panama’s economy and devastating Job losses

The closure of the Cobre Panama copper mine has significant impacts on Panama's economy:

Economic Impact:

The Cobre Panama mine accounted for about 5% of Panama's GDP.
Copper revenues were Panama's second-largest source of exports, accounting for about 10% of total current account revenues.
The closure is expected to decrease economic growth from a strong 6% in 2023 to a meager 1% in 2024.

Largest Metal Export:

Copper was Panama's largest metal export commodity. The Cobre Panama mine produced about 350,000 tonnes of copper in 2022, representing approximately 1.5% of global copper supply.

Job Losses:

The closure of the mine directly affects more than 7,000 well-paid workers employed at the site and in related industries.

Fiscal Impact:

The closure will result in lost mining royalties of around 0.5% of GDP per year.
The new contract, which was nullified, would have raised the effective tax rate to 25% and increased tax collections to more than US$400 million annually by 2025.

Investment Climate:

The closure sends a negative signal to potential investors, potentially deterring future large-scale mining projects in Panama and raising concerns about political stability and rule of law.

Broader Economic Context:

The mine's closure comes at a particularly challenging time for Panama's economy, as the country is also facing reduced revenues from the Panama Canal due to historic low water levels.
The Panama Canal, which accounts for about 20% of current account revenues, is currently operating at less than 60% of its normal capacity due to drought conditions.

The closure of the Cobre Panama mine represents a significant setback for Panama's economy, affecting not only its export revenues and GDP but also employment and future investment prospects in the mining sector.

Recommendations
1. Obtain Physical Silver (as much as you can afford)
2. Listen to our Buy and Sell Ratings
3. Figure out strategies to be Bankless (unbank)
4. Figure out strategies to resist orders from The State (like digital IDs and mobile phone verification)
5. Find local support from farmers, craftsman, artisans and find out who will accept silver as a payment.
6. Try to store about 6 months to a year in food
7. Obtain a generator because power outages are in our future (due to stress on the grid)
8. Keep your gas tank full and when it gets to half tank fill it up again.

Silver Academy