Silver And Sanity

SILVER PRICED AT $80 – $250 PER OUNCE: Total Insanity?

Probably not! In our crazy world, insane prices are likely. Consider:

  1. Tesla stock closed at $917 on February 19, 2020. That price made Tesla market capitalization larger than the sum of Ford, GM, and Fiat Chrysler plus annual global silver production.
  2. The Fed added over $900 billion to its balance sheet in six months, created from “thin air”. Total annual production of silver is less than $20 billion.
  3. The Fed is monetizing US government debt, as did Weimar Germany, Zimbabwe, Argentina and banana republics. When will central bankers learn?
  4. If health departments don’t test for COVID-19 (coronavirus) they can legitimately report no confirmed cases. (Hmmm, no worries, nothing to see, move on.)
  5. China has closed many businesses because of COVID-19. Chinese debts and cash flow requirements are huge. But they have assured us that economic and pandemic consequences will be minimal. Really?
  6. Per a politician: “… the world is gonna end in twelve years if we don’t address climate change.” The world survived ice ages, two world wars, black death, communism, pandemics, Y2K, hydrogen bombs, the great depression, $250 trillion in global debt, and eight years under several presidents. The world will survive an increase in carbon dioxide. Plants need carbon dioxide, and humanity needs plants. Yes, serious problems exist with insects, oceans, pollution, and soil, but the world will not end in twelve years.
  7. Tesla stock was $179 on June 3, 2019 and $917 on February 19, 2020. Amazing! Amazon stock was $300 in January 2015 and $2,170 in February 2020. The NASDAQ 100 Index was 4,800 in March 2000 but fell to 830 by September 2002. What goes too high can crash.

CRAZY AND INSANE ARE A MATTER OF PERSPECTIVE.

  • Tesla stock at $917 is crazier than silver at $100 in 2025. Buy silver and avoid over-valued tech stocks.
  • In 1919 gold sold for 10 German marks. In 1923 gold sold for one trillion German marks. Hyperinflation and QE4ever are bad policies.
  • The Swiss Central Bank created billions of francs from nothing, sold them for dollars and bought Apple and other tech stocks. Counterfeiting is legal for central banks, but not individuals.
  • Since 1945, the Argentine peso has been devalued against the (falling) US dollar by 10 trillion to one. Insane or just bad management?
  • Global debt exceeds $250 trillion. Can the global economy support interest payments of 5% on $250 trillion? What about only 1% interest? Are near-zero interest rates necessary to avoid insolvency? Global central banks will be forced to print how many trillions of debt-based currency units to keep interest rates near zero? Keynesian craziness? Gold and silver prices will rise.
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Disclosure: None. 

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