Summary
- Silver prices are expected to decline due to short selling.
- The author discusses the volatility of silver prices and the emotional rollercoaster that investors experience.
- The video highlights the recent escalation of military war games between China and Taiwan.
- China is moving away from the US dollar and using direct bilateral deals for trade settlements.
- There has been a surge in silver buying in China, with premiums paid for 1,000 oz bars reaching $39 oz.
- The spot gold and silver markets both declined this week.
- The author recommends buying silver during SDBullion's weekend sale.
- The global bullion market is expected to outperform bonds in the coming years.
- Central banks around the world are buying record amounts of gold.
- The author believes that the US dollar will continue to devalue and that silver is still undervalued.
We'll start with silver expectantly getting slapped by the shorts this week.
We are now retesting the $30 oz breakout line.
Quick few day check in on Silver Squeeze sentiment painted by the spot price charts, and you can see how fast the volatile emotions move from hour to hour, day to day.
No you're likely not crazier than me, but if you are a silver bull too, these are the volatile spot price side effects if you care and watch closely.
We're gonna get into all kinds of key global bullion market updates shortly.
But to begin, I'd be remiss not to start this week off by examining a bit of what has and is currently going on in China.
Look, the last thing I want is this channel to be a rumors of war fear mongering dopamine hit for viewers.
But this week, war games have escalated both internally and adjacent. Let's start with some damning data.
Since full fiat financialization went into high gear in the 1980s to follow, the hollowing out of the US middle class correlated with the rise of China as a global industrial powerhouse.
Of course, China has both her declared and undeclared ambitions.
Sitting in the way are western sanctions and a still dominant full fiat US dollar market share of global trade. As of the end of 2022 for instance, the full fiat USD still accounts for 44.2% in fiat FOREX trade for instance.
China instead pivoted to over land direct bilateral deals with its trading partners to bypass fiat US dollars as intermediary now in most of her trade settlements. You can see the explosive trend since 2011 to date.
Last month, China saw record withdrawals of fiat Chinese yuan from their banking sector.
Surely the Chinese citizens are understandably getting restless. I wonder why.
This week, China escalated air and sea military war games surrounding the Taiwanese island.
We're going to turn to India now for more eastern insights on the goings on this week.
Well, it's no surprise that it has become up, up, and away for local Chinese gold prices in fiat yuan.
On the silver side of this equation, one is left to wonder if all those recent record premiums paid out for western silver 1,000 oz bullion bars flowing from London and COMEX warehouses are indeed the push before global trade gets cut off further.
After all, if you are running a military without silver for inputs into your advance military hardware, bombs, and vehicles. Well you'll be up the creek with no paddle.
The premium paid this week for 1,000 oz silver bullion bars in China peaked as high as $39 oz.
Yea, silver squeeze.
The spot silver and gold markets sold on the week.
The spot gold price has dipped below $2,350 oz ask while the spot silver price closed the week testing the $30 oz breakout level passed late last week.
The spot gold silver ratio climbed to near 77, keep on eye on it breaking below 75 a ket short medium term resistance level.
Big bullion sale this weekend at SDBullion.com and I would politely suggest bigger silver stackers out there consider going with this 100 oz bar sale. Not sure how much longer silver bullion at a round $30 oz price will be available to us all.
For gold bullion buyers, the Royal Mint's Britannia is a great value this weekend.
Onwards, to the US economy.
Quick check-in on now near half the US population which in recent polls states they can't afford a $2,000 surprise expense.
Surprise, not surprised, the average US consumer is not well living off cheap consumer debt fumes.
This insight is corroborated by now nearly half of US renters spending over 30% of their incomes on their month to month rents. An all time high.
The secular bond bear market is alive and well, as to be expected after a 40 year full fiat financialization mega bull market. The bigger the bull, the bigger the bear.
Quick check in this week on many of the bag hodl'rs. Sea of red.
The global bullion over bonds phenomenon is only beginning, and world central banks buying record volumes of gold bullion the last two years in a quarter is not something any money managers should ignore.
That all said, we have a long way to go, and a lot of gold higher revaluing ahead of us this decade into next.
Record sized month over month capital flow allocations into the commodity sector have begun.
Turning the US stock market bubble ongoing, Saudi Arabia's sovereign wealth fund, around the current 5th largest in the world with nearly $1 trillion in assets, sold off nearly half its US stock portfolio last quarter.
Bigger picture, I asked about 75 of my followers the following question.
When does the S&P 500 us stock index and the spot fiat US dollar Gold price again reach nominal parity or 1:1?
About 1/3rd of you said next decade. Cool, I'll take the under on that timeline.
The fiat US dollar devaluing to Gold is by design, I'll God willing, be betting on that into next decade as well.
On the silver side of this equation, this chart illustrates using increasingly rigged US gov't price inflation CPI data, that if we were using 2011 fiat dollar purchasing power, spot silver would still be below $20 oz.
I wouldn't worry about rigged CPI data since 1980, they're gonna keep rigging cause they have to at least before the gloves truly come off.
The reverse of that point is how high silver prices in today's devaluing fiat US dollars got using the rigged CPI data alone.
Silver might be nominally high now, but it is still historically cheap versus other bull markets within our lifetimes where the world didn't end either.
Being over -80% off the old rigged CPI high of Jan 1980 won't last forever, expect that percentage to shrink as we move along in years.
Quick check over to India, yep their central bank keeps buying more official gold reserves, 24 tonnes admitted on the year thus far.
Another interesting point regarding India's record breaking Q1 2024 silver import flows of over 130 million ounces, aside from taking the seemingly lawless City of London's silver warehouse holding to new all time lows.
Given that local fiat rupee spot prices are now climbing walls of worry into an up and to the right runaway train. It is now surprise, even with relatively tepid silver bullion imports last year 2023 that India spent the most in local currency terms for silver than it ever had.
At least until this year 2024. Just Q1 2024's record silver bullion import buying covered over 3/4th or 75% of all fiat rupee spent on importing silver last year.
So yea, safe to say this year will be another record by far and away.
These charts are from 2022. Back when local fiat rupee silver prices were bottoming on an interim basis. That lower chart illustrates where the City of London's collapsing silver inventory levels were at the time in 2022. They are now at further record low levels, having dropped nearly another 100 million ounces lower than back then.
Congratulations to all Indian silver squeezers who bought the 2022 price dip. You have now nearly doubled your local purchasing power in short order.
Quick check in on the aggregated shadow price of eastern silver spot price now over $370 oz.
And now the aggregated shadow price of eastern gold spot prices now over $36,000 oz.
As the east gets wealthier, it is going to yank the red spot price lines higher over time, that my friends is inevitable.
While US congress critters pretend to be able to stop oncoming CBDC apps likely eventually provided directly by the US Treasury as the next fiat financialized crisis comes to bear.
My strong suggestion is you look beyond the R/L paradigm panderers, and instead remain focused on the real central bank power plans and their ongoing record gold buying over bonds actions.
All paper is destined to devalue to bullion, so get your fair share while it is still undervalued for now.
That will be all for our weekly SD Bullion Market Update.
And as always to you out there, take great care of yourselves and those you love.
