Silver And Sanity

Take the above population-adjusted total credit market debt and price it in silver ounces. Use the average of daily closing prices for each year to create an annual price. Debt increases faster than the price of silver, which is no surprise. The world runs on credit and debt, and currencies are debts (Federal Reserve Notes are debts of the Fed to you, the holder). The banking cartel creates billions in new debt every day. Silver prices, except in the 1970s, have not kept pace with debt creation. That will change.

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Take the same data and plot it as silver price (annual average times 10,000) divided by population-adjusted debt.

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  • Debt, adjusted for population, increases faster than silver prices. Fake money (debt-based currency) has prevailed since 1980 versus real money—silver.
  • Silver prices will “catch up” someday, perhaps soon, when fake money is recognized for what it isn’t. Investors and savers will scramble to buy a tiny supply of real silver and bid prices far higher.
  • Palladium prices spiked higher, defying expectations. Perhaps the parabolic palladium price increases foreshadow silver prices in the next one—five years.

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  1. Population will slowly increase. Use the past ten years as a guide.
  2. Debt will increase unless you think bankers will change their behavior, governments will balance budgets, congress will become fiscally responsible, and Pentagon spending will diminish as peace descends upon the world.
  3. The silver to population-adjusted debt ratio will rise to the upper trend channel. However, the ratio could move far above the trend channel.
  4. We need not assume a total financial reset or hyperinflation. Silver prices must rise in a debt-based fiat currency world.
  5. Assume the ratio will rise from 0.77 to 3.0 by 2025.

Using these mild and reasonable assumptions, the average price of silver (annual average of daily closes) could rise to $85 by 2025. Since price spikes can be three times larger than the annual average price (as in January 1980) the spike price of silver could be $250 without assuming global war, hyperinflation, global pandemic, central banks fighting recession with QE4ever, electing a tax and spend socialist in 2020, Universal Basic Income, MMT, negative interest rates for most of a decade, and other insane fiscal and monetary policies.

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