And 2022 or the very end of it.
I think is really showing us the setup.
And the setup is now in place, done again, for massive price for
valleys into the new year.
Well first I'd like to talk about.
Let's just look at the basics of gold and silver outperformed, both
gold and silver outperform.
The stock indexes the bond market, the real estate market, and the
crypto Market in 2022.
And yes, there are those, that would argue that it did not accentuate
the way that many people thought it would.
And, I would argue that the jury is still out on that, that the music
hasn't stopped.
It yet but certainly when we look at it in respect to traditional
assets and in terms of the crypto Market which seemed to outpace
everything.
For the last several years, gold, and silver did very, very well, in
fact, Friday's close and it's up again here today as we speak Tuesday.
But Friday is closed prior to the end of the new year, was the highest
weekly finish for gold and six months in the highest weekly go clothes
for silver in it.
Months.
And you know when you look back over the correction that we had in the
middle of the Year, September, October we see gold up over 200 dollars
since its local point and silver up by six points from their respected
lows.
It's also important to reflect on the strength of the dollar you know,
gold was unchanged basically almost to the penny unchanged in 2022.
From the start to the end on a year-round basis in dollar terms.
Alms.
But in terms of like the UK or the Euros in the UK in Euros, gold was
up 5.8% and up 11.8% in UK terms and setting an all-time high against
the, the Euro, 19 Nations, Euro currency at 1902 euros.
And, you know, so what we were seeing here in the states is an example
of a very
Dollar that was making gold and silver not appear the way that they
did the rest of the world.
I think one of the takeaways that I look at 2022, is that the central
banks have an insatiable appetite for gold and seem to not be able to
get enough?
In fact, in the third quarter, the official, net, gold purchases were
approximately 400 metric, tons somewhere in the neighborhood of 20
billion dollars.
And it was the most in over a half-century.
And if you look at a graph,
So you'll see there's really all the way back.
There's really nothing even close to it.
The next closest was somewhere I think like 2018.
There were two hundred and forty seven, tons purchased by the central
bank's nearly double what we saw.
This year or in 2022, rather you can look at specific examples of
countries like turkey who we talked about for a very long time were
you know, we're leading the way in 2022 with their gold purchases
38.9, tons of gold just in the month of November that the the year-end
totals for turkey ended up somewhere north of 225 tons.
Compared to the only 56 tons, they purchased the year before.
You can look at a country like India, who purchase over 300 million
ounces of silver.
That's more than 35% of the goal of the total Global mind Supply, so
that the central banks are gobbling up, metal.
That is absolutely a certainty.
And when we look at the way that this is affecting things, for
example, on comex, we noticed that
Comex had 350 4 million ounces of silver.
At the beginning of the year, ended the year at 299 million ounces.
Almost all of the decline in the silver market on comex, roughly, 55
million ounces, came out of the registered category that is the
category of bars that are available for delivery.
It is, what is backing the price-setting mechanism of the West and
down to roughly 34 million.
Answers, that's it.
So more silver was deducted out of the registered category than is
left in the registered category, which is roughly 10 times less than
the country of India.
Purchase you can see, we are beginning to draw down on the major
Supply Centers.
We've that was a big theme of 2022, but interestingly enough, everyone
talked about silver all year long that the percentage decline in
silver which worked out to 14%.
Percent decline in the registered cap.
Stocks gold inventories fell by over 30% from thirty three point.
Six million ounces, two twenty three point, two million ounces.
It's a much larger actually, drawdown of Supply, then everyone
focusing on Silver, quietly.
Gold is being drained at the same time.
We talked about how in one day, some mysterious buyer was able to
purchase 26 million ounces or 45% of all the kilo bars.
Hold on the comex.
This is this is a very unusual time in all the years.
I've done this, we never would see anything even remotely close to the
number of ounces that have been drawn down off of the exchanges.
And it's not just the comex as we talked about quite a bit on your
show.
The available inventory is on the London, Metal Exchange have plunged
and it's not just gold and silver that we always talk about.
They have six main Metals traded on the London, Metal Exchange and
Metals cumulatively 22 saw a 66 percent decline on average 72 percent
in aluminum zinc, shrank by 90%.
And so the countries that are pulling all of this metal off.
And I'd argue their, the brics Nations predominantly China.
They look at these Commodities as well.
And so they are accumulating a stockpile of War chest.
If you will of everything from Industrial Metals to precious metals,
and base metals.
And everything in between.
And I think that this is something to take really, really take note of
that.
The epicenter of availability in everything from copper to gold.
And everything in between is showing massive draw downs and this is I
think a trend that we will see certainly moving forward.
When we look at Silver in 2022, the silver Institute came
I'm told us that this is the largest deficit that we've seen in
decades, multi-decade deficit, between the amount of silver that was
demanded in the silver that was pulled out of the ground.
And, you know, it's interesting that they're telling us.
It was almost 200 million ounces about 195 million ounces shortfall,
but no one ever talks about the fact that the silver Institute throws
into this equation recycling.
And recycling in 2022.
I believe was somewhere in the neighborhood of 845 million ounces.
They expected to increase this year and for a third straight year.
And, you know, you're talking huge amount of silver cycling.
And if you pull the recycle out of the numbers, the total mind Supply
then drops from
You know, somewhere in the neighborhood of 800 million ounces to 662
or 663 million ounces, which really shows you the discrepancy between
mine supply and demand.
And it is growing this year, they there is a forecast of over 1.1
billion ounces that will be demanded and against a shortfall of at
least a couple hundred million ounces.
And when you pull recycling out that number could be as big as four to
five hundred million ounces.
The moral of the story of silver is depleting, and when you talk about
pulling recycling out and only looking at available mind Supply, it is
becoming harder and harder and harder to pull metal out of the ground.
And this is why the silver to gold ratio is.
So very, very important price ratio of 76 21 right now in relation to
a mining ratio of 7 to 1.
But I think it's really important to underscore
for something to do.
Get in that is at the silver prices, you know, closing the year at 24
over $24 up for the year even though they didn't go crazy, they held
up very, very well.
In the face of such a strong dollar multi-year highs in the dollar,
right?
Everyone talked about the strength of the dollar, from a perspective,
point of view.
The last time, the dollar was this strong silver was less than five
dollars an ounce.
So, this just goes to show how strong
Silver demand is holding up in the face of an incredibly strong dollar
and it's important to note that over the last two decades, the
correlation between the US dollar Index, and silver.
Futures is really, really crazy.
It's like, it's uncanny.
As a matter of fact, when the US dollar Rises, silver gets hit when
the US dollar Falls, silver outperforms.
And, you know, because all of
The global Commodities are priced in u.s.
dollars as the US dollar begins to weaken and we've seen that here,
the last few weeks of the earth seems to have turned over as the US
dollar weekends, we would expect all Commodities to catch a bid and
maybe that's exactly why you're seeing not just precious metals
disappear off that the London Metal Exchange, but also the base and
Industrial Metals.
So, a very big deal when we talk about a
Silver ratio right now 76 21 roughly that implies it takes 76 ounces
of silver to equal one ounce of gold and from a historical perspective
the last two years has averaged 200 years has averaged roughly 43 21.
So we are way way above where it is average for the last 200 years.
Knowing also that it's coming out of the ground at 12:53.
You could argue or 11 times undervalued in silver.
Just
To ponder the geologic footprint in relation to Gold but more
importantly we did see a ratio that peaked at over 90 to 21 this year.
And any time in history any time in history where silver has achieved
a ratio in comparison to Gold of 92, 21 or better.
It has started an epic turn around and in some cases it took a few
years.
Other cases like 2010 to 11 only took a few months but the the the
movement has often been explosive.
Now, this has happened four times since 2000.
I would expect this one to be much, much, much stronger because of the
drawdown and physical Supply off of the comex.
So, you know, from a perspective of what we saw in 2022 to
specifically talking about the metals.
And what we see moving forward, I am incredibly optimistic that 2023
will will
Uh, sure in the prices that many of us have expected for a very long
time, and that is mostly based upon things such as an, overly strong
dollar, that seems to be turning over massive industrial demand.
Massive demand from the sophisticated.
Accredited investors who not only are buying everything in the retail
space but also drawing down from, from the comex and the lme, I think
there is a lot of reason to be optimistic.
As it pertains to what the price will be in 2023 and 2022 or the very
end of it.
I think is really showing us the setup.
And the setup is now in place, done again, for massive price rallies
into the new year.