I want to speculate on the gold and silver price.
I don't want to speculate on premiums.
I would I would bet on the silver price of the gold price, not on
premiums.
Yes, I think just the start.
Let's touch about inflation to I think anyone who is done.
Anything recently has seen things go up, whether you fill your car up
with gas.
It's more expensive.
You go out to eat.
It's more expensive, you shop for groceries.
It's much more expensive.
You look at kind of what some of the Commodities are doing.
So, I just pulled up a chart this morning, looking at some of how
Commodities perform in the past year.
I'm looking at it.
Oats, or up 85% crude oils up 82%.
Coffee's up 73 percent natural gas is up 67 percent in the list goes
on. It's just almost crazy numbers when you think about it.
This is a one-year change and what's interesting, too is a CPI
actually reported in January, that inflation is seven and a half
percent, which I think is way understated because you look at some of
these numbers to.
And I think that that it's definitely a big concern.
So, what we did over here is we want it to look and say, like, what
what is this do when and what do investors need to be worried about
with this inflation?
So we looked at it just at seven and a half percent inflation, which I
believe is dramatically understated.
If you don't have a plan, seven and a half years of inflation, would
erode five-year Road, 32% of your wealth in five years, and that's
actually what we saw in the 1960s is inflation.
Started to rise up, the FED started to raise interest rates.
It took a nut five-year, actually, nine years to resolve in the 1960s.
There was a similar situation in the 1970s where it took five years.
Them to resolve that inflation.
So getting back on inflation of Rosier eroding your wealth.
It's been five years, seven and a half percent inflation is going to
erode the third of your wealth.
And a nine years is going to wrote a half of your wealth.
So definitely something that people need to consider.
Yeah, so gold in the 60s actually, what it was actually pegged in 19
and soul about 1971 at $35, an ounce, but the inflationary cycle
started in 1965, but from 1965 to 1970 for gold went up by five times.
So from about 35 dollars.
To about $200 and the second inflationary cycle from 1976 to 1980 and
went up eight times from about $100 to $850.
So time will tell whether that this will repeat or not.
You look at inflation in the last year and it's actually interesting.
If you look at the data from the BLS, it was only one point four
percent in January of 2021, which is just insane.
When you think about how it's went, from one point for up to seven and
a half percent in a year time.
What's going to happen with inflation?
There's one thought that says it's a transitory.
I think it was actually interesting to know when the FED said is
transitory thing.
Inflation was running around 4% And certainly it's higher right now.
It what 11 theory is when covid restrictions go away and
Nation could go away to as well.
Obviously the supply chains, what he's up and maybe that has a factor
in lower inflation.
But I think it's also interesting to note to you look at various stats
to and they said, about thirty percent of the money in existence has
been printed in the past couple of years.
So it to me that's that's a scary thought.
If you hold US dollars or any cash denominated instrument is now
you're going to have this, this vast amount of money going into the
system and then many times it takes takes them.
Time.
It doesn't get all put in there in the first month.
It may take several months.
It may even take a year or so.
I'd honestly don't think this inflation situation is getting resolved
anytime in the short term.
Yes, the starting.
Let's go back to 2019.
So 2019 was I guess our last normal year before covid.
I know it seems like a long time ago.
Now, I can't believe we've been at this thing for this many years, but
it was our last basically normal year.
We did about a billion dollars in retail sales, which is as you
mentioned. We're one of the largest if not the largest precious metals.
Or the u.s.
2020 came around.
Obviously, covid came.
We saw our purchasing customer Spike by about 1.5 x.
The x that we saw in 2019 and sells almost double.
So it and keep in mind doing a million or billion dollars in 2019 and
doubling that to almost two billion is not a small task and we sell to
the retail public.
So they this isn't large dealer transactions.
That multi-million.
These are all retail transactions and then 2021 rolled.
Around. And we thought that, hey, 2020 was a record year.
It's going to be tough to beat 2020, but a lot of these, these covid
lockdowns continued.
We had the silver squeeze Movement.
We just smash 2020s numbers in 2021.
So we saw about double the number of customers, in 2021 compared to
2019, which was our last normal year and we easily smash that two
billion dollar Mark and retail sales.
And then moving onto this year.
We're continuing to see strong demand seeing a lot of our existing
customers purchase.
We're seeing a lot of
H / lot of large orders to I think people are seeing the writing on
the wall that hey this inflation really is going up.
Certainly, 40-year Highs at seven-and-a-half percent.
I honestly think that we may see higher inflation next time.
The BLS releases their inflation later, I guess in a week.
Yeah, so we actually there was another Spike and the silver squeeze
time.
Just looking at like product mix for example.
Typically, we would see about 75% of our dollars get invested into
gold and about 25% into silver.
The silver squeeze spiked it up in silver.
Obviously. The silver was all in the news and about 40 percent of our Revenue
around that time was in silver and then people are still, see our mix
and silver.
Still heavier today than it has been historically.
I think a lot of people are seeing that silver may be undervalued.
Bear to Gold.
You look at both Metals.
Historically, they've been correlated Gold's near an all-time high at
19 and change.
Silver still well in the 20s much below its all-time high.
So I think people are seeing
A lot of opportunity that silver has lot of room to catch up in addition.
Some people might be taking advantage of the gold.
Silver ratio to is another thing, they might be doing.
But looking at history.
What's happened in the past is gold, typically rallies, first, and
then silver rallies after gold to a bigger and faster extent going
back to I guess the 2020 levels when we first had that covid.
Scare what I think a lot of you guys will remember as equities
crashed, the metals crashed, you saw silver, get to twelve dollars.
The downside about silver at $12 is you looked at, you tried to buy
any ounce of silver, and the premiums were like ten dollars.
So you still paid north of $20, which are like, well, so much for $12
silver, but an interesting solution and I actually took advantage of
it back in 2022, is one gold, which is a solution that allows people
to buy vaulted positions of precious metal.
So, Gold, Silver and platinum.
And what one gold does is it sources thousand out silver bars from
from the various, Mike wholesalers and so on.
And these
These Bars compete directly against the comics bars, but the nice part
about it is that I took a position in won Gold at basically about two
percent over spot, which is much lower than the ten dollar premium
physical.
And then a lot of customers did the same thing to and then when
premiums return back to normal a lot of customers plan on redeeming
this through the 1 V Redemption option and actually taking the
physical silver, whether it's gold Eagles or not.
So sorry, gold and silver eagles, silver Buffalo.
So, around silver bars, whatever it is.
Is so you have a lot of people doing that too as well.
And we certainly saw a big spike on one gold.
Yeah, and I think it's important that I want to speculate on the gold
and silver price.
I don't want to speculate on premiums.
The the downside with high premiums.
In some cases.
I think silver eagles are still selling for about ten dollars over
spot.
You don't want to buy silver, silver eagles at a ten dollar premium.
Let's say, silver goes up five dollars and you're like, hey, you made
the right investment, but your premium went down seven dollars, but so
you actually lost money which is like well,
Unfortunately, no one knows where premiums are going to go.
That's that's a function of what happens with the supply chain in the
midst and so on like that.
So I would I would bet on the silver price of the gold price, not on
premiums.
Yeah, so a couple months ago.
We looked at just basically what the bestop allocation is.
And this is according to history.
Obviously everyone's allocation is going to be different if you have
an inflation hedge, maybe it's less.
If you don't, maybe it's more or maybe maybe you feel like, hey, it's
more and then today's investment climate, but typically when you talk
to a financial advisor they said
Hey, you should do stocks and bonds.
And the thought is, if you do, stocks your more aggressive, if you do
bonds, you're more conservative and an allocation would kind of
balance a little bit of that and maybe you go heavier bonds, as you
get older, but we looked at less 50 years of data.
So basically since the 1970s, I didn't go before the 1970s because the
gold price was pegged at $35.
So it's not really a fair indication.
But basically, you know, 50 years of data.
And then what I did is I looked at 10 year average return.
So I normalize this, so I'm not going to penalize.
Stocks in 2008.
I'm not going to give gold the benefit of the doubt in 2011.
So I'm looking at 10 year average returns to, to say, hey the what,
what can we expect on a normal portfolio?
Looking at kind of normalizing, some of the returns and we actually
found out that it's actually possible to have almost a return of 100%
stock portfolio with the volatility of a bond portfolio.
So basically The Best of Both Worlds, you get the return but none of
the risk with 80% SP portfolio and 20% gold.
And the numbers actually,
We work out too and this, these are real returns to.
So the stock portfolio over that period of time, had a real return of
around seven percent five percent standard deviation, the bond
portfolio, obviously lower return five percent, return 3, percent
standard deviation.
So lower return, lower standard deviation and the gold SP and gold
portfolio had a 6.7% return.
So, not as The Little Couple basis points below the stock portfolio,
but a 2.7 percent standard deviation.
So actually lower than the bond portfolio.
So kind of an interesting thing as I
Everyone's case that therefore and I'd hate to make this a blanket,
you know, number and say every everyone do it.
It really depends on your asset, allocation your age and so on like
that.
Yeah, I think this investing climate is very unique situation.
We mentioned that inflation.
Is that a seven, seven and a half percent currently.
I think it's way under stated.
I think for many younger investors or who are investors, who may not
have studied history.
I think make sure to have yourself an inflation hedging in place.
You don't need to go crazy.
You don't need
Have. Hey, I'm going to do 100% gold or something.
But a little bit too couldn't hurt a little bit, could go a long way.
I think that that the next couple of years are going to be
tremendously bullish for precious metals, just because we haven't seen
this this type of investing climate since 1982 basically, so I would
say position yourself and you know, you don't want to just ride out
inflation just just with your normal portfolio.