Silver Squeeze?

Australia Sucks

 
Banned
Other Christian
My instinct tells me that you'll never get rich off silver, unless you're a dealer charging people fat premiums on 1oz coins. I could be wrong, but the following reasons make me doubt the whole "silver squeeze" thing:

1.) Silver is a byproduct of many mining industries and operations, and I've heard that gold mines literally just throw it on the ground and don't even bother processing silver ore because it's not worth it to them. If the price suddenly skyrockets, then all of these mining operations will start utilizing all of the silver ore and supply will increase, causing prices to fall back to normal.

2.) I believe that industrial use for silver is around 50%. Meaning half of all silver gets used in industry and the other half gets split between making jewelry and bullion/coins. Increasing consumer demand in the bullion sector won't be enough to disrupt the total silver market, which will be able to easily adjust to the marginal increase.

3.) Green energy is a scam, and that's what they're selling people on when they talk about a huge increase in future industrial demand.

Again, I could be wrong. But I've paid close attention to these wild silver predictions, and nothing has happened, with the exception of dealers charging more on premiums and probably getting rich from it.

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1) In terms of byproduct mining only around 27% of silver comes from primary silver mining with the rest being byproduct mining. But if you look at the chart only around 15% comes as a byproduct of gold. You can see around 41% comes as a byproduct of Copper and Lead/Zinc and silver is far more valuable then those metals so I doubt they would be throwing the silver away in those cases. Also even the gold mines would process the silver unless its an an extremely low grade/ore of silver in the mix that is non-viable to extract. I am sure there are a few examples here and there of what you are saying but I am hesitant to believe its common until I see evidence otherwise.

2) Yes industrial demand is currently close to 50% according to the table I posted in my previous post. A lot of silver bulls think that industrial demand and investment demand will both increase concurrently over time. Like you I am also not convinced by the bull case for silver but that being said the bull case is not completely without merit. The bull case is based on a combination of increased penetration of electronic devices globally (e.g. smart phones, etc) as well as increased uses of green technology (solar panels, etc), as well as an increase in investment demand for physical bullion if the general public ever loses faith in fiat.

3) Yes green energy is a scam but it that does not mean it can't keep growing for a long time. Who knows how long it will take for people to wise up to the scam. Central Banking is a complete scam and that has been going strong for well over 100 years with the majority of the populace none the wiser to the fleecing they are perpetually on the receiving end of.

I do not think dealers are getting rich from 1 ounce coins (unless its a big company that is minting its own rounds).
They have to buy them at a hefty premium from the mints and often only add $3 - $5 per coin markup (for the most popular and liquid coins. It can be more for other coins) onto the price as it is a competitive market with many bullion dealers who compete mostly on price. The fact that often if you buy a few thousand 1 ounce American silver eagles, Canadian Maples, etc in one go at best you might get $1 - $2 per coin off the single coin price. That kind of tells that what I am saying is likely to be right.

There are occasional periods where markups increase due to a shortage of retail silver products but that is because the mint puts up the price of those coins when there is shortage (it takes mints a while to catch up to a sudden spike in demand and mint more coins) and the dealers pass on that cost increase to customers.
 

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Kingfisher
Catholic
Gold Member
  • SILVER SUPPLY & DEMAND

The Silver Institute works with the Metals Focus team, a leading research
company that is based in London, to prepare and publish a comprehensive report on the
previous year’s silver supply and demand trends, with special emphasis on key markets and
regions. This annual survey also includes current information on prices and leasing rates, mine
production, silver trade, above ground stocks, and investment.
WSS2022SD-scaled.jpg

Material and statistics in this section were adapted in part from the Silver Institute’s World Silver Survey 2022.

Ultimately it comes down to whether or not you believe those numbers. I don't put much stock at all in those numbers.

In the video below, esteemed mining executive Keith Neumeyer dives into the numbers from last year. The discussion starts at 12:34.
 

C-Note

Hummingbird
Other Christian
Gold Member
Did the price of silver really drop by over a dollar this morning? Looks like investors have been dumping silver over the past few days. I don't know why.
 

C-Note

Hummingbird
Other Christian
Gold Member
I'm buying silver mining stocks (not bullion right now) but in small increments because I'm not sure that silver has reached bottom yet.
 

president

Ostrich
Protestant
Gold Member
Decent price for those but I'd recommend your very own RCM 10oz bars. The Asahi are known to milk spot (if that even concerns you) and the RCM bars have some special coating that prevents that. Also are usually only a % or so more than the Asahi.

RCM, Asahi, Germania 10 oz bars are the best imo.

You can also look at something like the Austrian Phils on sites like monument and hero - they are often equal to the price of the 10 oz bars I listed above and you're getting a divisible sovereign coin.
 

NoMoreTO

Hummingbird
Catholic
Decent price for those but I'd recommend your very own RCM 10oz bars. The Asahi are known to milk spot (if that even concerns you) and the RCM bars have some special coating that prevents that. Also are usually only a % or so more than the Asahi.

RCM, Asahi, Germania 10 oz bars are the best imo.

You can also look at something like the Austrian Phils on sites like monument and hero - they are often equal to the price of the 10 oz bars I listed above and you're getting a divisible sovereign coin.

I like RCM bars, a 10oz er would have been nice. I have a 100oz RCM bar and some 1oz maples. What I am doing now is buying bars and coins to kind of add a little variety to my stack. I like the idea of buying cheap bullion at the moment, it'll move more with the spot price. I'll buy in small amounts each month or when I can.

I saw some 10oz Royal Mint Bars (England) recently, they seemed pretty nice.

What is the benefit of getting a divisible sovereign coin? That would mean it has a dollar value on the bar?
 

president

Ostrich
Protestant
Gold Member
I like RCM bars, a 10oz er would have been nice. I have a 100oz RCM bar and some 1oz maples. What I am doing now is buying bars and coins to kind of add a little variety to my stack. I like the idea of buying cheap bullion at the moment, it'll move more with the spot price. I'll buy in small amounts each month or when I can.

I saw some 10oz Royal Mint Bars (England) recently, they seemed pretty nice.

What is the benefit of getting a divisible sovereign coin? That would mean it has a dollar value on the bar?
Well just the divisibility of 10 coins vs only one bar for potential use in commerce. A 100 oz bar would certainly be something cool to look at and hold but there's no way to divide it if you ever needed to.

For the Phils, I'm just saying they're minted coins not just rounds but are sometimes even cheaper than many of the rounds. I like the idea of diversifying the stack too, but you don't always have to buy bars to avoid high premiums.

You should get some of the Asahi rounds to match the bar and make a nice little Asahi set.
 

Caduceus

Ostrich
I've been thinking this about silver for decades now. Aside from that little spike where it went up to around $50 about twelve years ago though, it never happens. As much as it seemingly makes no sense logically, I no longer believe in my heart that silver will ever really go anywhere, at least not in my lifetime.

I agree.
People who bought silver between 35 and 49 dollars an ounce in the 2 years between January 2011 and January 2013, are still waiting more than 10 years later just to make their money back. (The all time silver high was 49 dollars per ounce in April of 2011.)

If you account for the inflation we have now, silver would have to reach between 50 and 70 dollars an ounce for the year 2011 to 2013 buyers just to break even.
 
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Gimlet

Pelican
Jp Morgan keeps making spoof trades to manipulate the gold and silver market. There is a criminal trial going on right now for their actions over the last 10+ years. That's why silver pricing is confounding. It's robbery. And JP Morgan will once again pay a fine and that's it.
 

Pointy Elbows

Pelican
Orthodox
For some reason, I get the feeling someone on Wall Street has targeted silver mining darling First Majestic for some "development assistance:'



I had a bank that fired all their white male branch managers, replacing them with women and minorities. Months later, they were bought out by a larger banking conglomerate that had some big WS money (I'm assuming blackrock-type operation).

Some oil companies have thrown their lot in with Solar/Wind - just so they can secure WS cash (Lines of Credit for operating capital). These are the guys that are NOT pumping oil at $4.50/gallon gas.

If a business is virtue-signaling DEI or ESG stuff, something is afoot.
 

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Kingfisher
Catholic
Gold Member
For some reason, I get the feeling someone on Wall Street has targeted silver mining darling First Majestic for some "development assistance:'



I had a bank that fired all their white male branch managers, replacing them with women and minorities. Months later, they were bought out by a larger banking conglomerate that had some big WS money (I'm assuming blackrock-type operation).

Some oil companies have thrown their lot in with Solar/Wind - just so they can secure WS cash (Lines of Credit for operating capital). These are the guys that are NOT pumping oil at $4.50/gallon gas.

If a business is virtue-signaling DEI or ESG stuff, something is afoot.


I'm certainly not condoning their sustainability report, but just about every public mining company has a similar sustainability report. I believe just about every public company listed on the NYSE has some type of ESG diversity initiatives.

I don't know why First Majestic caved in like this, other than to receive the investment of ESG funds. It's disappointing but ultimately I trust the CEO.

Full disclosure I am a First Majestic Silver shareholder.
 

C-Note

Hummingbird
Other Christian
Gold Member
I'm certainly not condoning their sustainability report, but just about every public mining company has a similar sustainability report. I believe just about every public company listed on the NYSE has some type of ESG diversity initiatives.

I don't know why First Majestic caved in like this, other than to receive the investment of ESG funds. It's disappointing but ultimately I trust the CEO.

Full disclosure I am a First Majestic Silver shareholder.
Yes, just about every mining company virtue-signals like this. They're just covering all the bases. Many of the best mining prospects, especially in Canada and in a few US states, are in areas governed by woke leftists or where there are a lot of environmental fanatics that may try to impede their operations.

One example is prospective nickel mining company, Polymet (NYSE: PLM), that I'm invested in. They're trying to open a nickel mine in Minnesota. They spent a ton of time and effort showing how the mine would be environmentally-friendly, which helped them get state and federal permits for the mine. However, in spite of having government permission, they've been tied-up in court for several years by environmental groups trying to stop them. It's one of the main challenges for that industry.
 
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