patrick.net

clambo says

I miss the good old days when silver was $46/ounce

I remember that! What was it 1978 or 79? I remember because I could take an old quarter to the coin shop and get $5 for it.

There is more silver in the world than could ever be squeezed from the water and soil, but not at $20 an ounce.

https://kingworldnews.com/sprott-china-is-replacing-u-s-treasuries-with-gold/




I don't know that this is true, but it makes sense.

do the elites prefer higher or lower precious metal prices?

where does a country like china buy a couple tons of gold?

Patrick says

I don't know that this is true, but it makes sense.

Its true about China's peak holdings of US Treasuries was in 2014 and they have been slowly selling off these holdings.

And its true China has been buying up gold: https://www.bloomberg.com/news/articles/2023-01-07/china-extends-gold-buying-with-fresh-flows-to-central-bank

They are in the top 10 as far as gold reserves: https://www.bloomberg.com/news/articles/2023-01-07/china-extends-gold-buying-with-fresh-flows-to-central-bank

.

Onvacation says

I remember that! What was it 1978 or 79?

20-teens, not that long ago.

komputodo says

where does a country like china buy a couple tons of gold?

Heard the Rothschild's stole some from Libya...

komputodo says

do the elites prefer higher or lower precious metal prices?

It's the only real money, and can't be manipulated/controlled, so definitely lower.

The SF Bay Area is an expat community of elites from that part of the world.

My observation is that money from those sorts of folks rushes in at or near peak valuation. They mostly like crowds; feel comfortable in and among crowds, including crowded investments. (This is why they're an outsized portion of Mom and Pop landlords in these parts, making eensy weensy cash flow and counting on speculating on appreciation).

It's a cultural thing.

So I would not be alarmed about their Gold Hoarding and Treasury Sell Off. It could portend of bad news, but it also could be a contrarian signal.

NuttBoxer says

can't be manipulated/controlled

It is manipulated it though:

https://www.reuters.com/article/us-barclays-regulations-gold-idUSBREA4M06620140523

LONDON (Reuters) - Barclays Plc has been fined 26 million pounds ($43.8 million) for failures in internal controls that allowed a trader to manipulate the setting of gold prices, just a day after the bank was fined for rigging Libor interest rates in 2012.

I bet those paper metal inside traders make a fortune. Dip the price, buy. Spike the price, sell. Repeat until you have "fuck you" money.

Our system is so rigged. The world is drowning in federal reserve notes. They are not backed by anything but the faith and good credit of our government.

They need their credit cards cut up.

Onvacation says

I bet those paper metal inside traders make a fortune. Dip the price, buy. Spike the price, sell. Repeat until you have "fuck you" money.

I agree as there is definitely some type of massive collusion to get this type of volatility. I would not doubt if financial media is involved with this as well.

That is why if you go in with silver like the silver ETF (ticker: SLV) then go long term such as at least 10 years and sell covered calls.

Going long term enough and selling covered calls will allow you to not be influenced as much by volatility driven by inside traders.

American investors, the Federal Reserve and the Social Security trust fund are buying up US Treasuries.

Look at the balanced mutual fund like Vanguard Lifestrategy Conservative Growth Fund, about 60% of its assets are in investment grade bonds, which means mostly US Treasuries.

The note holder for a vast majority of the US federal (and states) debt is the American public :-/

Expect Social Security tax to increase, if not a means test is applied within 10 years.

The American public are being conditioned for the future Social Security means test.

.

Patrick says

It is manipulated it though:

So just to be clear, when I say gold and silver, I mean gold and silver. Not paper, gold - and - silver. I know it seem like I'm preaching semantics, or making needless distinctions, but if you cannot separate the fake from the real, none of this will ever make sense.

ad says

The American public are being conditioned for the future Social Security means test.

I would bet the public already supports a SS means test. A poll question "Do you support a means test of $200k income or below to recieve SS payments, as a step to preserve SS?" would get overwhelming yes answers.

Foreign governments do not voluntarily get rid of their Treasuries.

China has been using its treasuries to pay for its imports. China runs a trade surplus with the US, but runs massive trade deficits with most of the rest of the world.

There is also the fleeing of dollar denominated assets from the CCP elites into anywhere other than China.

As for gold...China is the largest miner of the metal in the world. They will buy from their mining firms and pay in Yuan. The Chinese government has gone so far as to recommend to its citizens to invest in gold.

The largest international purchaser of gold far and away is India.

They are familiar with paper currencies going poof ! ! !

Gold/Silver ratio is now very high at 88. Could be a good time for silver to run... (or for gold to collapse).

It's been high for the past few years. If you're buying, definitely silver, always physical, always take delivery.

When you buy gold, do you get the gold or just a piece of paper saying you have gold? If it's a piece of paper then it's not much of a hedge against anything.

Onvacation says

.

not surprised as silver has been beaten down since 2011

maybe crypto investors and gold bugs are shifting some money to silver

and crypto may have crowded out or taken the steam out of the silver market, with Bitcoin coming on scene around 2010

.

Silver over $40 an ounce now.


AD says

crypto may have crowded out or taken the steam out of the silver market, with Bitcoin coming on scene around 2010

Crypto is easier to store.

Onvacation says

Crypto is easier to store.

yes, I bought 600 shares of Fidelity BTC exchange traded fund (ticker FBTC) when it first came out and BTC was around $60,000

I own about an equivalent of 53% of one BTC through FBTC

that is easier than storing in a bank safety deposit box a bunch of silver eagles

or can just conveniently buy silver through a silver ETF like the ticker SLV

.

https://moneyweek.com/investments/silver-and-other-precious-metals/is-now-a-good-time-to-invest-in-silver

Is silver worth investing in?

Is silver worth investing in?
As well as the industries above that have traditionally driven silver demand, Ash also highlights three “boom industries” to which silver is particularly relevant:[ ](https://moneyweek.com/invest.../605822/renewable-energy-boom)renewable energy (particularly photovoltaic (PV) solar panels);[ artificial intelligence (AI)](https://moneyweek.com/investments/4-ai-stocks-to-invest-in), thanks to its use in wiring, connectors and switches; and [defence](https://moneyweek.com/.../defence-stocks-rise-as-uk-faces...), for the same reasons.

The rise of these industries is, potentially, contributing towards an imbalance of supply and demand for silver which should, over the medium term, be positive for the silver price, and make silver well worth investing in.

According to The Silver Institute, between 2016 and 2024 total annual demand for silver increased from 993.3 million ounces to 1.16 billion. Over the same period, supply fell from 1.06 billion ounces to 1.02 billion. In other words, where there was a surplus eight years ago, there is now a deficit.

The boom industries are the main drivers of increasing demand. Total industrial silver demand increased from 491 million ounces in 2015 to a record 680.5 million ounces in 2024, and that number is expected to jump by 9% to 711 million ounces in 2024.

Electronics, particularly PV solar panels, is the largest driver of increasing industrial silver demand.

One thing to keep in mind when considering investing in silver, though, is its[ volatility](https://moneyweek.com/glossary/volatility).

Futures and options speculators call it “the devil’s metal”, says Ash, on account of its propensity to make sudden, sharp moves just as they think they’ve figured it out.

“That's less of a risk for investors trading physical[ bullion](https://moneyweek.com/invest.../gold/how-to-buy-gold-bullion) at spot prices, but its volatility is still significant,” says Ash. “While that can bring opportunities, it can also leave you nursing losses for extended periods of time.”

If you're thinking of buying gold or silver funds like GLD, SLV, the iShares, etc., please be weary of potential complexities in tax filings. Also, tax entanglements with foreign-traded securities. At the very least, you might consider trading in an IRA to at least avoid some of the paperwork... maybe.

Also, although those funds are convenient and maybe OK for speculation, they also may be plundered when the SHTF.

AD says

Is silver worth investing in?

You spelled "speculate" wrong.

HeadSet says

AD says

Is silver worth investing in?

You spelled "speculate" wrong.

silver is a commodity that is very useful unless it gets replaced for other applications like Pentagon weapon systems, electrical equipment, solar panels, etc

it has tangible value, granted that makes its market a target for manipulation such as by governments which do not want to see silver increasing that much in price due to the economic impacts such as on renewable energy projects
.

AD says

silver is a commodity that is very useful

No doubt. But buying silver to hold onto hoping for a price increase is speculating, just as it would be for undeveloped land. Side note, my BIL is a retiring dentist and has a huge collection of dental xrays form his and another dentist's practice. Each negative has a small but recoverable amount of silver so he is extracting the silver currently. Local laws prohibit him from just throwing out the negatives.

Gold is more than keeping up with silver.

Are gold and silver in bubbles, and is this market manipulation?
I have a friend (no joke) who's buying - when do they get off the merry-go-round?

Gold/Silver Ratio – Long-Term Historical Trend from GuruFocus

As of 2025-10-03, the Gold/Silver Ratio stands at 81.36, which is above its long-term historical range of 59.

Over the past 20 years, the gold/silver ratio has reached a high of 123.07 in 2020-03-19 and a low of 31.48 in 2011-04-28. The average (mean) ratio during this period is approximately 70.2 with a standard deviation (σ) of about 14.34, placing the gold/silver ratio 1σ range between 55.86 and 84.54.

As of 2025-10-03, the Gold/Silver Ratio is trading above the +1σ level, suggesting that gold is relative to silver from a historical perspective.

Historically, when the ratio deviates beyond this range, it tends to revert toward the mean, presenting potential opportunities for investors.

So the price of silver should increase more than gold, it is now around $48 an ounce which was nearly the same price in 2011 when it last peaked. Its all time high was around $51 in 1980.

From financology.net:

Year to date (9/19/2025) returns (in dollars)

US Treasuries (GOVT) +5.44%
US stocks (VTI): +13.89%
Rest of world stocks (VXUS): +26.38%
Copper (CPER): +19.67%
Gold (IAU): +43.75%
Silver (SLV): +57.84%
Platinum (PLTM): +72.43%

Platinum was trading at less than a third of the price of gold - even with the runup, it's still less than half the price of gold.

rocketjoe79 says

Are gold and silver in bubbles, and is this market manipulation?
I have a friend (no joke) who's buying - when do they get off the merry-go-round?

Not a bubble. When the money that was created out of thin air bounces around long enough, it comes to rest at the feet of those who own real assets like precious metals, and land.

Ray Dalio, founder of one of the world's largest hedge funds, believes investors should allocate as much as 15% of their portfolios to gold.

I really really wished I bought some gold before it popped. Oh well.

AD says

Ray Dalio, founder of one of the world's largest hedge funds, believes investors should allocate as much as 15% of their portfolios to gold

As does Danielle DiMartino Booth but I think she claimed that she herself has 20% or more. Something about her fear of China. She even made her kids learn Mandarin. This was a few years back.

Maga_Chaos_Monkey says

Danielle DiMartino Booth

yep

Danielle DiMartino Booth, CEO of Quill Intelligence, views China as an economic rival with an ongoing "economic cold war" with the US. She closely monitors China's economic data, identifying weaknesses and potential spillover risks for the global economy.

Danielle DiMartino Booth is bullish on gold, viewing it as a critical safe-haven asset in a volatile economic and geopolitical climate. The former Federal Reserve insider sees mounting systemic risks that support gold's historic rally, including economic weakness, rising US debt, central bank policy missteps, and geopolitical tensions.

Gold is up about 60% year over year. Asset bubbles always go further and higher than reasonable people think possible. That's because reasonable people don't fully grasp the CRAZY of people living in the bubble. Most gold is traded in commodity accounts. In the US, our commodity exchanges let people put down about 5% of the contract's value. This is about $1500 down for a $34k contract. I dunno what foreign exchanges require.

After the Great Depression, we limited stock margin ability to 2:1. With gold you can go 20:1. The sheer amount of borrowed money tied to gold contracts is stupendous.

What could possibly go wrong ???

Misc says

Gold is up about 60% year over year. Asset bubbles always go further and higher than reasonable people think possible. That's because reasonable people don't fully grasp the CRAZY of people living in the bubble. Most gold is traded in commodity accounts. In the US, our commodity exchanges let people put down about 5% of the contract's value. This is about $1500 down for a $34k contract. I dunno what foreign exchanges require.

After the Great Depression, we limited stock margin ability to 2:1. With gold you can go 20:1. The sheer amount of borrowed money tied to gold contracts is stupendous.

What could possibly go wrong ???

How do you value it to understand how inflated it is and how big the bubble is ? One way is that gold will return to the mean as far as historically (at least 15 year period) returned a real return of 4% annually ?

Gold now is around $4000 an ounce and its last all time high was $1780 in October 2012 until it started to increase by summer 2020.

So it only increased by about 6.5% annually from October 2012 to present day; and its real return is around 4% annually based on 2.5% annual inflation rate.

Below table shows annual changes in gold prices for last 50 years.

Year Annual Return for Gold (%)
1975 −24.20%
1976 −3.96%
1977 +20.43%
1978 +29.17%
1979 +120.57%
1980 +29.61%
1981 −32.76%
1982 +11.75%
1983 −14.99%
1984 −18.95%
1985 +6.17%
1986 +19.54%
1987 +24.46%
1988 −15.69%
1989 −2.23%
1990 −3.69%
1991 −8.56%
1992 −5.71%
1993 +17.64%
1994 −2.17%
1995 +0.98%
1996 −4.65%
1997 −22.21%
1998 +0.57%
1999 +0.54%
2000 −6.06%
2001 +1.41%
2002 +23.96%
2003 +21.74%
2004 +4.40%
2005 +17.77%
2006 +23.92%
2007 +31.59%
2008 +3.97%
2009 +25.04%
2010 +30.60%
2011 +7.80%
2012 +8.69%
2013 −27.61%
2014 −0.44%
2015 −11.61%
2016 +8.62%
2017 +9.54%
2018 −1.06%
2019 +18.28%
2020 +25.75%
2021 −3.73%
2022 +2.08%
2023 +13.14%
2024 +27.20%
2025 (Forecast) +39.09%

The $850 per ounce in January 1980 when adjusted for inflation was just topped in September of this year. Let's see how stupid people can be this time around.

The CEO of Newmont mining (largest gold miner in the world) bailed a few days ago (once you quit, insider sales rules don't apply). Guess he wanted to cash in now instead of waiting for a better price.

... but sure 15% of your portfolio at this price....what could go wrong ???