Silver Soars! Spot Price Smashes Through $30 Barrier
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Secrets to Stockpiling: Unveiling 13 Silver & Gold FACTS
The high inverse correlation between US real yields and the gold price is history (for now). Despite the rise in real yields, the rise in the gold price could not be halted.
Central banks are a decisive factor in the demand for gold: Demand from these institutions is not very price-sensitive, and central banks likely have put a floor under the gold price.
De-dollarization:
The militarization of fiat money has lasting consequences: The confiscation of Russian reserves and the assets of Russian oligarchs in 2022 was a wake-up call for numerous states and wealthy private individuals from the Gulf states, Russia and China. (Luxury) real estate in London, New York or Vancouver has always been the preferred destination for savings from the emerging markets, but this has changed in 2022.
Safe-haven assets are becoming scarce: The list of liquid safe-haven assets is getting shorter. New and old safe-haven assets are gaining in importance.
In contrast to the gold drain in the US in the 1960s, the emerging markets are now experiencing a gold gain. China is playing a leading role in this respect but is no longer alone. India purchased more silver in Q1 of 2024 than it did for the entire 2023. The Western financial investor is no longer the marginal buyer or seller of gold.
Shanghai now controls the pricing power of the gold market. Precious metals (because of arbitrage opportunity) are flowing West to East, and this will intensify because yesterday Putin and Jinping exchanged bilateral documents following the gold for oil playbook. China can now buy more oil through the gold proxy than before using the US dollar. This means that all emerging markets under the Chinese Belt and Road investment umbrella will act as a buying syndicate following the gold for oil architecture of Russian economist Sergey Glasyvev.
Monetary climate change: Fiscal largesse has seriously jeopardized the debt sustainability of Western countries. The explosion of the interest burden is a harbinger of the limits of debt sustainability.
The new playbook in the context of stagflation 2.0: The Great Moderation is over. Periodic supply shocks will cause additional fluctuations in inflation.
The end of the 60/40 portfolio: A positive correlation between equities and bonds, as in the case of structurally higher inflation rates, means that bonds offer no protection when growth slows.
The central bankers’ new playbook: The holy grail of the 2% inflation target is no longer sacrosanct. Even before the mark has been sustainably reached again, Western central banks are openly discussing changing course to a less restrictive monetary policy.
Noninflationary investments such as gold, silver, copper, and battery metals are increasingly important for investors.
CRYPTOWARNING: We recommend that Crypto investors understand that crypto has never gone through a recession. Moreover, all technology has built-in obsolescence. Computer systems will fail under an electromagnetic pulse event. Lastly, future wars will attack power grids, and cyber warfare will exceed kinetic warfare. Here is the best mental image to convey this URGENT WARNING TO CEASE CRYPTO PURCHASES: When the lights go off, you have nothing, whereas gold and silver shine under candlelight.
Buy Gold and Silver Now Before they are Unobtanium.
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Incrementum edited by Pixy
I’m cautiously optimistic that the BRICS black swan and their emerging gold for oil gambit might finally end the west’s ability to tamp down PM prices.
In the meantime, two questions: First, is India’s buying all really for India? I’m an earlier post, I thought you showed how the US military was laundering silver purchases through Indian jewelers. So, will large Indian purchases help put upward pressure on silver, or actually act as a bit of a lid as the US government tries to keep prices low for the war effort?
Second, do you know anything about the capital gains taxes on PM’s and how that affects selling them, for those who plan, or will be forced to, exchange them for depreciating fiat? I realize that the goal is for the people to effectively get off the fiat treadmill by transacting in PM’s when the feces touch the rotating blades. But assuming that some people, at least, will want or need to liquidate prior to the final end game, would you be willing to do a column on the ins and outs of capital gains taxes? I’m realize that for now, for sales below $10k, the practical reality is that reporting to the IRS is more or less voluntary. What will happen when gold becomes, say, over $10k/oz? Or what if someone must liquidate $20k in gold or silver under current law and circumstances? How do capital gains taxes affect their profit, and what might be some mitigation strategies? Taxes and other “gotchas!” are important parts of all forms of asset protection strategies from now until the point in time when fiat and the tax collection system fully stop functioning. Traditional tax and financial planners generally seem to shy away from doing anything with metals except ETF’s and tackling these kinds of questions seems to be beyond their pay grades. That’s why I’m trying to do my research through people like you who have an aggressive interest in metals and genuine understanding of how governments react to them. Thanks, in advance, for your help in bringing light to this possible issue.