PHYSICAL gold and silver will be the best performing assets in 2017.

GoldBullThe world is facing the perfect recipe for a record bull market in precious metals: Supply shortages of PHYSICAL gold and silver; volatile exchange rates; negative returns on government debt; real-world inflation on essentials; the prospect of even more extreme measures by the Federal Reserve [negative interest rates, helicopter money], and a loss of confidence.

Silver and gold are poised for ferocious price moves


More than half of the people in the world believe real money equals real bars and coins of silver and gold. Since the global financial collapse ( 2007/ 2008), investors in Russia, Shanghai, India, Dubai, Bangkok, Vietnam, Turkey, Singapore, Hong Kong have been draining supplies of precious metals from bullion banks in the West.

At the end of 2015, precious metals prices rose dramatically. The rapid rise was spurred by disruptions in supply channels. Institutional investors in the West, sovereign nations, central banks, and mega-buyers from the Eastern Hemisphere are taking delivery of actual bars by the metric tonne. Russian buying has dwarfed purchases by China!

Physical gold shortages will propel the next big move. The biggest precious metals exchanges in the world are running short of “good delivery” bullion (400 oz gold bars, 1,000 oz silver bars). There has been a massive draw-down of deliverable gold at the New York COMEX (Commodities Exchange); and warehouse inventories of available gold bars in London are extremely low (LBMA/ London Bullion Market Association). 

THE FOLLOWING LBMA BULLION BANKS ARE UNDER PRESSURE: HSBC Bank -Hong Kong & Shanghai Banking Corp (a custodian for GLD/ Exchange Traded Fund for gold); Barclays Bank; ScotiaMocatta; DeutscheBank; JPMorganChase Bank (a custodian for SLV/ Exchange Traded Fund for silver).

DELAYED DELIVERIES/ WAITING LISTS: As a result of “scrap” shortages, the world’s five major refineries have waiting lists for deliveries. Around the globe, mints cannot satisfy the demand for “good delivery” bars. 

Although coin dealers in the United States are still able to find silver/ gold coins and bars, that could change at any time. Last summer, silver supplies dried up; in July 2015, dealers could not satisfy customers’ over-the-counter demands. 

The PHYSICALS market is a ‘different breed of cat’ than PAPER gold/PAPER silver derivatives— Exchange Traded Funds (ETFs) and futures contracts. The exchanges can sell PAPER silver and PAPER gold without the physical bullion to back the contracts (Naked Shorting).

When supplies are scarce and demand is high for physical silver and gold, spot prices quoted by the exchanges in London and New York disconnect from the prices buyers must pay to acquire actual product. “Premiums” rise on coins and bars in relation to increasing demand and decreasing supply.

Gold is the premier currency.

Credit FROZE worldwide on August 9, 2007.
Since the first day of the global financial crisis,
Aug. 9, 2007:  London p.m. gold fix $662.60/oz
July 11, 2016: (NY spot) gold @ $1,358/oz

If you keep your savings in dollars, you are guaranteed a loss of purchasing power over time. Today, it takes 37 times more dollars to buy 1 oz of gold than in 1971; it now takes 68 times more dollars to buy a 1 oz gold coin than in 1933.

Forty-five years ago, $1 was worth 1/35th of 1 gold oz. Today, $1 is worth 1/1,260th of a 1 oz Eagle gold coin.

Take delivery of silver and gold while coins are still available. For thousands of years, coins of gold and silver have been a store of value and a lasting legacy.

Click for a larger photo

Editor’s Note: I have seen first-hand what happens to prices when shortages of PHYSICAL bullion are extreme. During the Jan. 1979 to Jan. 1980 short-squeeze, gold and silver prices quadrupled. Silver dealers across the nation were “bid only” / “no offer.” Take delivery of gold/silver while coins are still available. Fear could trigger a worldwide flight to safety and panic-buying.

by Denise Rhyne


Prices for goods and services do not rise uniformly. Gold was $525/oz on Jan. 5, 2006. During the 2008 crash, people were shocked when gold surged past $1,000 for the first time (March 14, 2008). Rather than pointing to the eroding value of the dollar, experts said speculators had created a bubble. When food prices took off, media blamed the weather, rather than the loss of purchasing power of the dollar.

The deterioration of the reserve currency is hidden because the Euro, yen, pound, and other currencies are falling faster than the dollar. However, money printing is showing up in inflated stock prices and rising costs for energy, utilities, health insurance, fees, groceries, restaurants, medical care, airfare, tuition, housing and rent. The invisible tax is siphoning off your savings. 

Creative accounting and new ways to calculate the Consumer Price Index (CPI) and Gross Domestic Product (GDP). The new method to determine how much the cost of living is changing uses hedonics, weighting, and substitution. Most changes in costs for the essentials (food) are excluded from indices.

There is always a ‘lag time’ before prices reflect the expansion of the money supply. Massive dilution of the money supply will eventually cause a sudden, sharp rise in prices, even when demand is low:

Inflation: An increase in the amount of currency in circulation, resulting in a relatively sharp and sudden fall in its value and rise in prices.  The rise in prices is caused by an increase in the volume of paper money issued.” Webster’s Twentieth Century Dictionary, Ogilvie, 1904.

Obscuring the reality of dollar debasement. To avoid the spotlight on the ballooning money supply, the Federal Reserve quit publishing the M3 monetary aggregate in 2006. The Fed no longer reveals how much or how fast the total money supply is increased (the official money supply quadrupled 2009-2014).

GLOBAL DEFLATION WILL LEAD TO CREDIT COLLAPSE and CURRENCY FAILURES. The world is in an industrial depression. Hyper-deflation and hyper-inflation are two sides of the same coin. You will have no third-party risk if you exchange “paper” investments for actual coins. PHYSICAL gold and silver in your possession means real liquidity.

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