Silver

Preparing for the Possibility of Hyperinflation

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By Anthony Gilbert – Writer at http://www.realfx.com/blog/

Hyperinflation is a rapid increase in inflation where the prices rise so drastically that calling it inflation becomes meaningless.  While there is no set percentage for hyperinflation, it is often used to describe price increases of 50% or more over a short period.  The sharp increase is what separates hyperinflation from other types of inflation.

What Causes Hyperinflation?

Hyperinflation can occur when the government begins printing larger amounts of money to pay for spending.  As the amount of money being printed increases, the prices of goods and services will increase.  Typically the government would lower the supply of money to curb inflation, but when they continue to print more, there can be an imbalance in supply and demand of currency.  Prices will then skyrocket, and currency will begin to lose its value.  This results in hyperinflation.  Hyperinflation can occur at any time but historically has often happened as results of war economies.

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Oil Paradigm Shift Dead Ahead

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By Spock – Re-Blogged From http://www.Silver-Phoenix500.com

Global Macro Thesis: Copper, Copper, Copper

The Chinese are holding their next national congress assembly from 18th October. This is a major event where macro policy for China is agreed and implemented. On the agenda will be the electrification of national road transport, with a plan to be all electric by 2050. This will achieve two objectives: Reduce pollution in the major cities and to be the global leader in the electric vehicle (EV) technology, and associated technologies. The Chinese are also building the infrastructure around the concept, including a huge electric grid upgrade across the country over the next 10 years, to cope with the additional load.

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Buyers Take Advantage Of Secondary Market

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By Clint Siegner – Re-Blogged From Money Metals Exchange

The U.S. Mint is on track for the lowest sales of American Eagle coins in almost a decade. The 2008 financial crisis began a historic ramp up in sales that lasted for years. 20,583,000 silver American Eagles sold that year, more than double the 2007 total of 9,028,036 coins.
In all but one year thereafter the Mint set a new record Sales peaked in 2015 at 47,000,000 Silver Eagle coins – 5 times the number sold before the world discovered just how rickety the global financial system actually is.

Memories are short, however, and investor complacency is setting in.

Sales to date in 2017 are just short of 16 million coins and are set to finish the year very close to the 2008 totals.
U.S. Mint sales are viewed as a proxy for bullion sales n the broader market. There isn’t much else available in the way of published data. However, Mint statistics don’t tell the whole story.

While retail buying activity is still stronger than retail selling, we’ve seen a meaningful increase in customer selling of coins, rounds, and bars over the past year. A lot of the American Eagles traded today are therefore resale coins which don’t show up in the Mint’s reporting of new minting activity.
Government Mint Bureaucrats
Don’t Respond to Market Conditions
Private mints and refiners are responding to weaker sales by lowering premiums on rounds and bars. The government bureaucrats which run the sovereign mints, including the U.S. Mint, largely ignore these competitive forces. To date, they have not adjusted pricing.
Demand for government-minted products therefore suffers the most as buyers take advantage of significant premium discounts available in other products and secondary market items.

While retail bullion demand in the U.S. is certainly weaker overall, it is way better than the Mint’s statistics might imply. In a sense, the bullion markets are more balanced. National dealers like Money Metals Exchange make more of a two-way market, both buying from and selling to clients.

That is good news for buyers. The days when new production Silver Eagles were strictly allocated and supply fell hopelessly short of demand are behind us, at least for now. Investors can get those coins for around $2.50 over melt value, instead of paying up to $6.00 and waiting for delivery – which has been the case on a few occasions over the past 5-7 years.

Any buyer who doesn’t have to have a sovereign coin will find plenty of other silver products with premiums under a buck – such as rounds and bars. Gold premiums and availability are also improved.

Premiums could go even lower if retail demand does not increase despite the renewed bull market in precious metals that began in late 2015.

Much will depend on spot prices. Many people are impatient with the seemingly gradual rise in gold and silver prices off the 2015 bottom. If prices accelerate upwards, investors will finally start believing in the new bull market.

Perhaps an even bigger variable is the atmosphere of complacency in the markets and how much longer that will persist. Our view is that virtually all markets are severely underpricing risk. More investors should be buying safe-haven assets rather than selling.

It is hard to reconcile the world we find ourselves in today with record stock market prices, at least not without the artificial forces of central bank stimulus in massive amounts and algorithmic trading. Those forces are formidable, to be sure. But how much longer can bankers (both central and Wall Street) forestall the ultimate reckoning for all of their excesses?

Investors asking the same question should take advantage of the buyer’s market in metals while it lasts.

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Silver Prospects

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By Ted Butler – Re-Blogged From http://www.Silver-Phoenix500.com

Here’s a recent interview I did with Jim Cook, President of Investment Rarities, Inc., for whom I’ve consulted for more than 17 years (where did the time go?). It’s gotten to the point where about the only interviews I do are with Cook, but that’s not due to our long relationship. Rather, it’s because he comes prepared and wastes no words, making my role easy. With Cook, it’s always about getting to the heart of the matter, with the least amount of fluff as required.

Cook: Are you disappointed with the recent price action in silver?

Butler: Of course, I thought we might finally be breaking out.

Cook: What happened?

Butler: It’s the same old story.  As I outlined previously, we were setup for a strong rally at the recent lows, but whether the rally was of the now-typical $2 to $3 variety or the big one was based upon whether JPMorgan added aggressively to COMEX silver short positions. JPMorgan, once again, stopped the silver rally cold by adding massive amounts of short contracts, just as they have on every silver rally over the past ten years.

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The Forthcoming Global Crisis

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By Alasdair Macleod – Re-Blogged From http://www.Gold-Eagle.com

The global economy is now in an expansionary phase, with bank credit being increasingly available for non-financial borrowers. This is always the prelude to the crisis phase of the credit cycle. Most national economies are directly boosted by China, the important exception being America. This is confirmed by dollar weakness, which is expected to continue. The likely trigger for the crisis will be from the Eurozone, where the shift in monetary policy and the collapse in bond prices will be greatest. Importantly, we can put a tentative date on the crisis phase in the middle to second half of 2018, or early 2019 at the latest.

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New Thinking And Different Actions

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By Gary Christenson – Re-Blogged From http://www.Silver-Phoenix500.com

Hypothetical 65 year old American Male:

Height: 5’10”

Weight: 285 pounds – 120 # overweight

Health: Marginal, with chronic pain and increasingly difficult daily existence

Ask our hypothetical male if he wants to lose 100 # of unnecessary fat, improve his physical health, live 10 years longer, increase stamina, reduce chronic pain, and drive a golf ball 50 yards longer off the tee.

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Commercials Betting Against Breakout

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By McClellan Financial – Re-Blogged From http://www.Silver-Phoenix500.com

The price of spot silver is trying really hard to break a long-term downtrend line, which would arguably be a bullish development if the breakout succeeds. But the big-money “commercial” traders of silver futures are betting heavily on a failure of that breakout attempt.

The Commitment of Traders (COT) Report is published every Friday by the CFTC, detailing futures positions held by traders in 3 different groups:

  • Commercial traders are the big money, and usually the smart money.

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