Silver & Gold Revaluations Following Price Consolidation

In the last week and few days, silver and gold spot prices have remained stout while more speculative asset classes have been cut by more than half their price in many cases.

A few years ago, the Bank for International Settlements made this handy money flower chart that points out that all currency proxies' source comes from the hardest forms of money humankind has ever used.

Have a look at the embedded tweets below for further clarity.

Physical precious metals like silver and gold may not have been the fastest horses thus far in benefiting from the ongoing fiat currency race to debase. One thing we know with near absolute certainty, silver and gold bullion will make it to the finish line, come what may ahead.

This week, we will review where we stand in the ongoing silver and gold 21st Century bull market. As well as try and get a grasp on timing to come.

The recent stand-out performing hedge fund, Crescat Capital, released some excellent charts this week.

This first one reiterates the point we made on this channel last week, that price inflation is not merely a monetary phenomenon but also a psychological one. Judging by the psyche of the human mind and internet search for the building inflation zeitgeist, we may not be far from the tipping point when fiat Fed Notes become hot, devaluing potatoes you must consume quickly before they devalue badly.

If we look at the current silver spot price to the exploded fiat Fed Note M2 currency supply, we see that the current near $30 an ounce silver bullion is still historically low compared to how much currency is sloshing around the financial system now.

The quarterly candle chart of the silver price going back three decades shows good support for a coming valuation upside that runs ahead.

Now over $31 trillion, the combined balance sheets of eight major central banks. Nearly $8 trillion or nearly 1/4th of which sits on the Federal Reserve's ballooning balance sheet as of the last update. By the end of this decade, many financial experts believe this Federal Reserve balance sheet will have more than 3 to perhaps 5 fold to keep this system from falling apart.

Hard to believe confidence will last that long with inflation concerns already as both internet search and last few decade psychologically high levels.

This week I ran into a nice simple chart that reiterates a long-time gold bullion price target I have made regularly on this SD Bullion channel. High four-figure fiat Fed Note priced gold bullion is already injected into the current monetary system. I and others remain confident that it is coming in time.

But to close the week, I want to look ahead to later this year for gold and silver by looking back on some of the comments we have made on this SD Bullion channel regarding likely timeframes. Large deflationary big banks or financial system failures would be the lone caveat to consider here to there, perhaps getting in the way. But after listening to comments of which I still stand by. Look ahead to the second half later in 2021.

We are in the present day of this video's release, May 21, 2021, and I still maintain barring some deflationary bank of financial system implosion, we should be seeing new nominal price highs for gold by the end of this year. And silver should be making a run through the $30s and likely into the $40s before the calendar year changes.

If the past is indeed a prelude, in a year to come, we will see silver sharply outperform gold with a falling gold-silver ratio back towards and likely beyond the old 2011 low of 33.

I hope you and your loved ones get prudently positioned before those days come to pass.

That is all for this week's SD Bullion market update. Subscribe to our channel if you have not done so already.

Please, as always, take great care of yourselves and those you love.

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James Anderson
James Anderson
Senior Market Analyst & Content

A bullion buyer years before the 2008 Global Financial Crisis, James Anderson is a grounded precious metals researcher, content creator, and physical investment grade bullion professional. He has authored several Gold & Silver Guides and has been featured on the History Channel, Zero Hedge, Gold-Eagle, Silver Seek, Value Walk and many more. You can pick up Jame's most recent, comprehensive 200+ Page book here at SD Bullion.

Given that repressed commodity values are now near 100-year low level valuations versus large US stocks, James remains convinced investors and savers should buy and maintain a prudent physical bullion position now, before more unfunded promises debase away in the coming decades...