As many experts in the precious metals industry have recently noted, there has been a growing disconnect between the physical precious metals price, and the so called “spot” price derived from the paper market on the COMEX. Physical coin and bullion dealers have had to make up the difference between supply and demand on the premiums. This trend became most apparent in March 2020, when physical inventory across the country dried up at lightening speed.
As the quarantines were gradually lifted in the following months, shuttered mines reopened, inventory reappeared, and premiums decreased. But with the world on edge, and seemingly being in the eye of the hurricane (an obviously temporary state), we could be on the cusp of another run on precious metals if lockdowns continue.
Furthermore, with the economy on the brink, and governments forced to turn on the printing presses to deal with the destruction of lost paychecks, we may be about to witness a revolution in monetary history. This would mean a combination of rapidly dwindling supply of the metals, as well as an inflationary vortex of money creation driving up prices very quickly. Eventually, these forces will form a critical mass, and the artfully constructed man-made dam protecting fiat currency will burst as mother nature takes over and floods the valley. The question is, will you be wearing your life vest? We will, and it will be silver.
Scott – editor of The Silver Independent