Rebecca Ridolfo, July 2016
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Silver – the Collision between Markets & Miners


Silver may seem rather obscure, arcane and niche, not particularly important. However, it plays a far greater part in everybody's lives than appears at first glance – certainly everyone who lives in an urban environment. Even if it's not obvious, silver really is significant. What is happening in the silver markets is going to have a big impact on the world.


The last bull market in silver peaked in March 2011 at £28.18 per ounce. The price hit a low of £9.64 in October 2014 and a lower low of £9.04 in December 2015. Silver began 2016 at £9.43 and rose steadily to £11.77 on 20th June, just before the Brexit referendum. It then soared rapidly to a high of £15.82 on 10th July. After moving sideways for a while, as of 16th August, it is at £15.48, an increase of 64.2% year-to-date. This makes silver the best-performing asset of 2016 so far.

Bullion Vault silver price chart

In April 2016, Deutsche Bank settled silver & gold price manipulation lawsuits at the Manhattan federal court in New York. The German bank admitted that it had been repeatedly rigging the metals markets and agreed to help the plaintiffs pursue similar claims against other banks as part of the settlements. Another conspiracy theory made fact and many more lawsuits in the pipeline.

The mining sector has also begun its own bull market, in part due to rules about which assets funds are allowed to buy. Those that cannot buy physical bullion are buying mining equities in order to get exposure to the momentum of the nascent precious metals bull run. The big mining companies are still in business largely thanks to stealthy and not-so-stealthy corporate QE. Among the small & medium-sized miners – those with good management that have survived the testing times of the past 5 years – are well-positioned to benefit from this new phase of the fiat monetary system. The rise in mining stock prices shows the dawning realisation that debt saturation & malinvestment are choking the real economy, that paper only has the value given to it by faith & confidence and that hard assets are real rather than imaginary.

Read the article

1] The Roles of Silver Silver Part 1

2] Markets & Miners Silver Part 2

3] Responding as a Small Investor Silver Part 3


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