John Rubino – Is There A Sea Change Going On In The Silver Market?
John Rubino, Founder of the Dollar Collapse website and editor of his newsletter over at Substack, joins us for a broad discussion on the silver sector and precious metals, that then transitions into the macroeconomic factors moving the markets. We start off reviewing some of the data recently released from the Silver Institute showing that silver demand has increased by 38% since 2020 while mine production recorded a shortfall and was at a deficit in 2022. We discuss the hybrid nature of silver from the industrial demand side and the investor demand side of the equation, and ponder what higher prices and a widening supply deficit could mean for the silver mining stocks.
Next we shift over to the recent news of First Republic’s implosion, being another bank in a recent string of bank failures and challenges to bite the dust, and how that may be shifting some people to reallocate some cash in banks into more defensive investment products, like gold and silver. The discussion evolves into some of the larger economic data points on the horizon from inflation and the labor markets, to what a Fed “pause” after this week’s rate hike may be like, if the higher rates were allowed to persist for 9-12 months as they have messaged. John outlines some of the challenges already being seen due to higher rates in commercial real estate, residential real estate, automobile loan departments, and businesses being forced to roll over money borrowed at steeply higher interest rates. He also points out that another factor to have on the radar is when the “unicorn” companies start dying off in Silicon Valley.
I had posted this at the bottom of the weekend show blog earlier today, but felt it was worth reposting here on this discussion today about Silver with John Rubino.
Safe Haven Or Industrial Demand? Why Silver Has Returned To The Spotlight
By Hareesh V – Economic Times – Apr 30, 2023
First Republic Bank Is Seized and Bulk Sold to JPMorgan
Rachel Louise Ensign & Ben Eisen • Wall Street Journal – (05/01/2023)
“Regulators seized First Republic Bank and struck a deal to sell the bulk of its operations to JPMorgan Chase & Co., heading off a chaotic collapse that threatened to reignite the recent banking crisis.”
“JPMorgan said it will assume all of First Republic’s $92 billion in deposits—insured and uninsured. It is also buying most of the bank’s assets, including about $173 billion in loans and $30 billion in securities.”
“As part of the agreement, the Federal Deposit Insurance Corp. will share losses with JPMorgan on First Republic’s loans. The agency estimated that its insurance fund would take a hit of $13 billion in the deal. JPMorgan also said it would receive $50 billion in financing from the FDIC.”
More from that WSJ news article above:
“Three of the four largest-ever U.S. bank failures have occurred in the past two months. First Republic, with some $233 billion in assets at the end of the first quarter, ranks just behind the 2008 collapse of Washington Mutual Inc. Rounding out the top four are Silicon Valley Bank and Signature Bank, a New York-based lender that also failed in March.”
While many in the financial media are trying to minimize the recent string of bank failures, that data above points out how serious this is, with likely more carnage to come.
Stock market today: Dow slips despite First Republic rescue; Fed meeting eyed
Yasin Ebrahim – Investing.com (05/01/2023)
“The DOW closed lower Monday as investors were reluctant to make big moves in either direction ahead of the Federal Reserve decision later this week and weighed the government takeover and sale of First Republic to JPMorgan.”
Gold: Topping Process Followed By A Pullback (Technical Analysis)
Florian Grummes – Seeking Alpha – May 01, 2023
“Since the triple bottom last autumn, Gold is up $430 or nearly 27%. Silver is up 50% over the last eight months.”
“With an overbought weekly chart and growing negative divergences, the air is getting thinner for the precious metals and a pullback could start soon.”
“Statistically, seasonality for gold remains unfavorable until midsummer.”
“However, the banking crisis, the dollar crisis and the geopolitical crisis should all keep a bid below the gold price. Hence, pullbacks might end somewhere between $1,900 and $1,930.”
“Overall, we expect a topping process followed by a pullback and a new buying opportunity in July or August.”
Zoltan Pozsar Says Commodities Are Poised for Growth
“Commodities have their own unique story”, Zoltan Pozsar told me in an interview in 2023.
“Zoltan told me that despite the grim economic situation, we could still experience a bull run in commodities as the supply chains have been heavily hurt by recent events as well as decades of underinvestment in the commodity space. In this clip, he also told me which commodities he thinks will outperform over the current decade.”
00:00 Important note
01:10 Why commodities; Why now?
12:53 Why is this not the 1970s?
15:30 How long will this commodity cycle be?
I think we are beginning to see a resource war between China and The U.S., especially with silver and many critical and rare earth metals used in electronic devices like solar panels, satellites, and defense munitions. China has for now cornered a lot of these elements and The US will need to challenge them if they want to be a player in the new technology. DT
Good pick Cali Joe. I have been trading around a core position in Endeavor Silver for a number of years. It was one of the silver stocks I added to with another 2 tranches, when we had the pandemic crash in the Spring of 2020. I was just going to buy and hold it for the long-term, but then it had a huge move up into that #SilverSqueeze moment in February of 2021; so I liquidated a lot of it there to pull profits, as I felt the silver sector was way overheated on that frothy move in dual-listed US companies.
I did have reservations about adding more last year, after the fantastic former CEO, Brad Cooke, passed away, but then decided to add more to beef up the position more last spring when many silver stocks got smashed down to silly levels again.
I like Endeavour Silver as a higher cost mid-tier producer, that will have nice margin expansion as the silver price keeps running higher. They’ve historically had a lot of torque to the upside snd downside versus the metal. Also, I like their pipeline of development and exploration assets, for some legit growth potential.
All good points Ex. Also, you’re pretty verbose lol
Thanks CaliJoe.. Yes, I like details and long-form communication with substance over sparse, brief, and often vague one-liners.
Most of the authors, comedians, podcasters, or thought leaders I respect take their time to unpack ideas thoroughly, and that is the form I also prefer. Some people think “less is more” but usually, that is far from true (with some exceptions like a good quote or a poem). Even people with famous quotes, normally were quite verbose in the rest of their written works, and people are just cherry-picking one piece of prose that was well-stated and brief to highlight.
Sometimes people can make a nice short concise point, but very rarely are those getting at the nuances, unpacking complex concepts thoroughly, providing multiple data points, sharing insightful stories or experiences, and it usually takes more words and context to lay out most concepts meaningfully. Sure, “short can be sweet” and make a brief point, but often does little more than that. Those kind of comments just do little for me personally, without more color and details.
Of course, all comments, both short or long in nature, are appreciated.
First: Pithiness is a worthwhile skill and art. That’s a fact if you value making a lasting impact on your reader. Your claim that “short can be sweet and make a brief point but often does little more than that” is just ridiculous and patronizing.
Second: If you’re going to talk about nuance and “unpacking complex concepts” perhaps you should know the difference between arbiter and arbitrator. On April 16th you told me “you are not the arbitrator of what a good deal is either…” but it’s not just arbiter/arbitrator you got wrong. You should have known based on my words that that comeback of yours was unwarranted/made no sense. I took issue with your pontificating about “how things should be” precisely because I know that letting the market sort things out is the only way to go. Therefore, that automatically means that I know that I am also not the arbiter (or arbitrator lol) of what a good deal is. Yet you pointed it out anyway because the entire exchange was lost on you.
Wow indeed. I told my spouse I bet 90% odds, this guy on our blog (you) is going to come take an insulting jab at me (like you repeatedly do, even when I try to keep it civil with you), and then find some reason to strongly disagree with my post… all while making a few personal insults against me. You are so damn predictable Matthew. Haha!
I was simply sharing above my totally valid preference and opinion on communication and what I value… just like you do, so I could care less whether you agree or twist yourself into pretzels to try and come up with a counter narrative and take another swipe at me.
We are not going to agree about most things Matthew, and have much different views and opinions on a number of topics, and that’s totally fine and really I don’t care what you think of me or my perspectives. Hopefully you don’t feel the need to have some dramatic come back that you know better, with more personal attacks, but you probably will anyway…
I never thought I’d see anyone defend verbosity let alone do so verbosely!
FYI, my comments above contain observations not attacks but I hope you can find a safe space if you disagree.
Haha! So predictable…
Ex, I don’t like what I am seeing in your personality these days, there is no point in saying anymore because the change has to come from within where it was created. DT
“Back to your corners!”
Time to be cautious with AMD. I’m seeing a TON of bullish writeups
The FDIC is Using Up It’s Cash to Protect Wealthy Uninsured Depositors
Nobody Special Finance – May 1, 2023
“The FDIC has now used more than a quarter of the entire Deposit Insurance Fund to reimburse uninsured depositors from Silicon Valley Bank, Signature Bank, and now First Republic Bank. This is contrary to both the spirit and wording of the law and now the FDIC is at risk of running out of money leaving the people it was meant to protect without a lifeboat.”
The Banking Collapse Of 2023 Is Now Officially Bigger Than The Banking Collapse Of 2008 Was
by Michael – The Economic Collapse – May 1, 2023
“Yes, you read the headline correctly. Collectively, the three big banks that have collapsed in 2023 had more assets than all 25 banks that collapsed in 2008 did. Unfortunately, the banking collapse of 2023 is far from over. We still have eight more months to go before this year is done, and many more banks are currently teetering on the brink of disaster. Executives at those banks are telling us not to worry, but of course executives at First Republic were issuing similar assurances just last week. Personally, I had heard that First Republic supposedly had enough reserves to keep going for months. But that was a lie, and now First Republic is toast.”
“In addition to providing JPMorgan Chase with a 50 billion dollar credit line, the FDIC will also take a loss on this deal of approximately 13 billion dollars. So they are definitely one of the big losers in this deal…”
“Needless to say, the biggest losers of all are the shareholders of First Republic.
They got completely wiped out…”
“Stockholders got bailed in and wiped out. They’d already been mostly wiped out by Friday evening in one of the most spectacular stock plunges ever. Holders of the unsecured subordinated bank notes got bailed in and wiped out just about entirely. This is a form of preferred stock. For example, the 4.625% bank notes, issued in 2017, traded at less than 2 cents on the dollar this morning, another spectacular plunge.”
Michael Snyder left out the fact that JPMorgan had pay $10.6 billion to the FDIC to acquire First Republic Bank. Also JPMorgan Chase did not get a 50 billion dollar credit line from the FDIC like Michael Snyder states. JPMorgan Chase got a five-year, $50 billion fixed-rate term loan. This is different from a line of credit. Also JPMorgan has to repay the $25 billion in deposits from ten large U.S. banks and eliminate $5 billion in its own deposits that were a part of the $30 billion rescue deal engineered to stabilize First Republic back in March.
The FDIC really did not use up more than a quarter of the entire Deposit Insurance Fund as the guy in the video states. The amount will end up being much less than that. This is because any losses to the Deposit Insurance Fund to support uninsured depositors will be recovered by a special assessment on the banks, as required by law. So most of the $23 billion that was temporarily taken from the FDIC Deposit Insurance Fund and used for the Silicon Valley Bank and Signature Bank failures will be reimbursed.
Thanks Wayne. That’s an interesting clarification on the FDIC reimbursement and appreciate you sharing that point with us.
Here is a fantastic table from MiningDeck of insider buying 04/24- 04/30 in a number of mining stocks that was posted by a contributor Jeff Hayes over on the SilverChartist blog.
As the saying goes… “There are lots of reasons for people needing to sell some stock, but only one reason to buy.” Nice see these recent insider buys in a number of quality resource stocks (like AbraSilver, Nighthawk Gold, Kodiak Copper, Fireweed Metals, Highgold, Impact Siver, Guanajuato Silver, and Ridgeline Minerals).
Enjoyed your interview with John Rubino.
Thanks for that feedback on the interview with John Rubino Abrevaderci.
He’s a sharp guy, and we hard to put out quality content that is informative and pick topics that are engaging. Much appreciated.
KTN, Kootenay, just using this as an example but the warrants that triggered at $.135 or likely now being sold at $.095. Prolly many other companies that had recent financings experiencing the same thing, brilliant timing on the companies’ part.
Come on. It’s uncanny how gold is up today the day after Joe comes on here to trash it and say SELL SELL SELL. Quick day traders dream to have such a gimmie indicator. 😏
My guess is he was buying from distressed sellers yesterday, good call, never assume someone is an idiot, they may be setting you up.
Great insight Dan.
The all knowing here being set up by a troll.
Oh just wait for the long winded posting that will be made like clockwork of their successes of how to buy low and sell high. As if it’s new found wisdom.
I am not in the schoolyard casting stones at the other side, it is a waste of time and effort. I am here to learn to be a better trader and investor and have no patience anymore for crap; mine, yours, joe’s or matthew’s or ex’s, all of you have more value than that, especially Matthew and Ex. Parse the info and take responsibility for your actions.
If you don’t like IPT then don’t buy it, if you want to deride people rather than learn, start your own damn site.
Thanks for that comment Dan. Well stated.
yes Dan. very good comment. So let’s leave Joe alone shall we.
Joe is treated appropriately considering his jony-esque (uppity, bitchy) attitude.
That’s possible, Dan, but it’s much more likely that we can take him at his word. His seeming uncanniness for nailing lows is perfectly consistent with human nature. The overwhelming majority of traders/investors become most confident in a trend just as it is ending. And since Joe is a nobody like the rest of us and relatively new here, it is unlikely that his words are causing enough shares to be sold to do him any good. So it is likely that his drive to be right is more powerful than any urge to troll unless he’s completely delusional about the effect he might be having.
Thanks for the insights on Joe, I will definitely take them into account as I was likely giving him too much credit, haha.
So far Joe has been a perfect contrarian indicator, as previously noted, with his table pounding “Sell, Sell, Sell” call on Sept 24th (right before the PM miners bottomed on the next trading session Sept 26th and rallied higher with GDX and GDXJ up 65% over the next 6 months).
Then he came on again on March 7th of this year claiming it was time to sell everything in the PMs once again, bottom-ticking the low in Gold at $1812 intraday that day perfectly for the next run higher up to $2050 in just under 2 months after that. People could make a fortune just taking the other side of the trade, as that has been precision contrarian action.
After reviewing his dozens of posts for the last year and half, he takes great joy in trolling the PM sector and this site, much more so that adding any real value, and can’t have any delusions of being “right” at this point. A number of us have repeatedly asked him to clarify the “why?” behind his dire calls (either fundamentally, quantitatively, or technically) and he’s never responded back with any real substance or meat on the bone. Anybody can make a binary outcome “buy” or “sell” call vocally like he does, but without putting out the logic and thesis behind it, it’s just pissing in the wind. Joe is a site troll, but a very useful one in how good of contrarian sentiment indicator he has been.
Ex we know you’re a market genius vs Joe. Little need to condemn him and continually convince the crowd with the same data points with his calls, especially if you’re benefiting using him as a contrarian indicator with the easy to follow buy low / sell high doctrine you post.
Thanks jon syl, but I was illustrating those very points with actual facts and data about him being most vocal near oversold lows, and perfectly bottom-ticking the last 2 lows that were followed by rip-roaring rallies in the sector. Using facts and data shouldn’t be novel concept, but it is a process he doesn’t share or utilize.
That is not “condemning” but rather outlining the obvious, that he isn’t trying to be right, but rather get a reaction from others (like most trolls). However,he shouldn’t be tuned out or ignored like most hecklers, and is in fact a useful KER site troll that serves as an excellent contrarian indicator. I’ll point that out to help other investors navigate the insane level of noise as often as I please, and yes, look at markets rationally to actually buy into low bottoming periods, and trim profits on oversold topping periods. Buy low and sell high should be every investor’s doctrine, but unfortunately most are merely trend followers.
JOBS………. down……… gold up………… rate hike humm…..
Added to Kuya 10K shares
Thanks Marty. I added 10,000 to Nevada King. Looking into more copper.
A corrupt banking system only benefits a very few. Why do investors accept it as the only option?
Because they ARE CLUELESS……….
Anyone have GAS –BOIL UNG- in here. Another great opportunity to accumulate one of them lows. LOL
Benchmark IPT doing it’s usual prophetic thing in this most recent gold pop up.
The IPT shares I added this morning are up as much as GDX.
Is it enjoyable being such a dumbass? Just curious…
I wish James Dines was alive to give us his target for silver. What is Jim Sinclair saying? Silver @400 and gold@8k would not surprise me. I can’t believe the 100% premium to buy silver eagles. When I bought mine there was a 12% premium over spot. Why would anyone pay so much for silver eagles when he could buy silver maple leafs or kangaroos for a 25% premium? I don’t get it.
Uneducated group…….. they are thinking that they can get them graded MS70…
Playing the rare coin theory… I am referring to the Silver Eagles…
MS 70……… on PCGS……… is $65
Year 2000………grade MS 70……….. $4350………….
I wait in anticipation of Biden telling people to melt granny’s silver teapots to increase supply, haha!;-D
Might check the tea pot……and see if, it….says…..KKK…………. lol…..
Hi Bonzo. While the great Jim Dines is no longer with us, we do regularly interview his successor, Nick Hodge, on the KE Report now.
In our last interview I asked Nick to address how he took over Jim Dines letter and subscriber base, and he had some nice things to say about Jim and how he is trying to honor his legacy. (Nick is pretty bullish both gold and silver at this point).
That section of our discussion takes place starting at the 23 min 50 sec mark, and here is a link to that for quick reference:
Bonzo………. Sinclair’s site is OUT OF BUSINESS…….. according to Bill Holter…..
According to Bill …. jdsmineset….was never owned by Sinclair…..
Bill’s letter is on the web…..
If, anyone knows anything different…… let me know…….thanks
Bill Holter can probably shed light on Jim Sinclair and his health. I got the impression that Santa was close to retirement years ago and was withdrawing from public commentary. He owned a mine in Tanzania and I think one of his daughters was operating that or involved. I got the impression he was headed there full time, but since I stopped following him, it is very possible he is still in the states. His residence was sold …. anyway I am sure Bill Holder can update the situation. Santa is a blast from the past … He tried to inform everyone about the evils of Wall Street and referred to them as Sociopaths before it became popular. He would Know!
Thanks……… I use to follow Sinclair daily/weekly….
still listen to Bill when he appears…..
Thanks for the extra….. on his daughter …. I was wondering what happened to the mine
I googled Tanzanian Gold and there are several articles on Santa retiring from the Board at 80. They give some history but I didn’t see anything current.
I use to watch Taz gold… always thought Sinclair was way ahead of the crowd…
I was looking for some “happy” to “glad” trades, but gave up. The OTC markets appear to be on a hallucinogen.
Interesting article on what made Jesse Livermore probably “The World’s Greatest Trader”. Two things stick out in my mind and are highlighted in this article, (1) He understood human behavior and (2) He understood the profound psychological reaction from the exuberance of 1929. The other points that are talked about are more technical in nature and can be learned much more easily. DT
Always liked Jessie……” Sit tight…… made more money by sitting on my hands” …quote….
FYI : Reminiscences Of A Stock Operator (Jesse Livermore)
Total Global Silver Demand Posts Record High Of 1.24 Billion Ounces In 2022
The Silver Institute – 04-19-2023
“All major silver demand categories achieved record highs in 2022, pushing total silver demand to a new high of 1.242 billion ounces (Boz) last year. Silver industrial demand rose by 5 percent, physical investment increased by 22 percent, and jewelry and silverware rose by 29 and 80 percent, respectively, leading to the total global silver demand milestone. Since 2020, the global total has increased by 38 percent as world economies recover from the pandemic.”
“Along with record silver demand and lower mine production, the silver market achieved its second consecutive annual structural deficit, at a significant 237.7 million ounces (Moz) last year.”