Buy Silver Now!

In many ways, most of us can’t wait to put 2020 behind us and call it last year.

We’ve experienced a once-a-century global pandemic, infecting almost 80 million people. Lockdowns caused businesses to shutter and soaring unemployment, with massive economic consequences.

If you dig a little deeper, other costs include soaring debts and deficits worldwide. We’re approaching an unfathomable $280 trillion in global debt. Governments and central banks have facilitated tens of trillions in stimulus spending this year alone, and it’s far from over.

The U.S. is now passing its latest $900 billion stimulus bill, promising new stimulus checks, boosting unemployment, small business aid, and funds for schools and universities.

It’s little wonder that some asset classes have been riding this wave, not the least of which is silver. And looking ahead, the metal appears primed for another great year in 2021.

Debt, Deficits, and Stimulus Boosting Silver

2020 was good to some investors. Stocks gained, with the S&P 500 ahead about 13%, while the Nasdaq is up some 17%.

Precious metals investors fared even better. Gold has gained around 23%. Yet silver outshone all of these with an outstanding 44%. But as I’ll explain, I think gold’s cheaper cousin is set for another year of outsized gains.

I believe we’re entering a perfect storm for silver. Not only are central bank balance sheets exploding, but major economies are passing stimulus bills that, just a few years ago, would have been near-scandalous. What’s more, they’re doing so not just with relative ease, but outright encouragement.

The Fed’s balance sheet was $4.2 trillion at the start of the year. Today, it’s $7.3 trillion and growing. This year the U.S. Federal deficit will be triple that of 2019.

 

And yet, almost no one seems to care. Until…inflation.

I think inflation will be the dark horse of 2021. As vaccination rates climb and the visible effects of the pandemic subside, I expect our wild rates of money printing will start to take effect. Currencies, in particular the US dollar, are likely to weaken.

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