I own gold myself for risk avoidance, silver moves further and faster.
Silver seem to move in the second half of a bull market.
It would seem to me the establishment of the validity of the narrative
is led by the fear buyer.
Somebody who buys gold for the classical reasons to protect themselves
and in the
Half of the tubule Marcus, I've lived through in my life, gold has
driven and silver has lagged when the momentum in the price in the
second half of the market, or even in the third third of the market
kicks in silver, moose further, and faster, the lower unit price of silver.
As an example, gives the bottom path of the world's.
Elation measured by economic Cloud, the ability to participate in the
inflation narrative.
A poor person in India who sees their rupiah depreciating by 20% a
year and being rewarded with the three percent savings rate.
It may be that the unit cost of gold at 60 or 70 dollars.
A gram is too high for them to participate and that great hunk of
mankind can only participate in the narrative and something with a
Lower unit cost which is to say silver.
Similarly.
The speculators are drawn to the volatility of silver.
And after the narrative has been driven by gold, the speculators look
to the historic.
Outperformance was silver relative to gold and of course become
attracted to Silver in the second half of a bull market.
I don't know why it is is David.
I can tell you why in terms of interest rates precious metal should do well.
I don't know why the
Under performance of gold in the first half of a bull market and the
relative outperformance part of me the Rope the really under
performance of silver in the first step of a bull market and the
extraordinary out performance of silver in a second half of a bull
market occurs.
I can only tell you that I've experienced in very dramatic fashion
twice in my life and I let some horrid Fascination.
Look forward to experiencing it again.
I own gold myself.
For risk avoidance.
I look at conventional Financial assets assets, as being in some way
riskier than the rest of society.
And the idea that I would add to rather than delete.
My risks seems odd to me many, many, many Americans, and I can't speak
for British people or Irish people, but many Americans believe, if you
can't touch it, you don't own it, which means that they take physical
delivery from a shop like yours and they engage in an activity that I
laughingly refer to as midnight gardening.
Which is to say that they try and keep gold and silver on the premises
and inexplicably.
They often mention this to other parties, which means sometimes those
other parties visit them at inappropriate times with weapons to
relieve them of their physical gold, and silver the introduction of
the type of risk that happens.
When you engage in self storage or midnight gardening is
Be unacceptably, high unallocated storage.
If the dealer that is selling the unallocated storage or providing the
unallocated storage isn't public, is an unacceptable risk on allocated.
Storage means, you don't actually own the gold and silver.
What you are is an unsecured creditor of the dealer or the storage
facility.
And if you can't see their balance sheet and their income statement on
a quarterly basis to understand that their good credit risk, you can't
afford to be
Be an unsecured creditor where you don't know enough about the value
of the other credits against the collateral that you have.
Remember, in unallocated storage.
You are a hypothecated credit creditor.
You're an unsecured creditor and being an unsecured creditor where you
don't understand the credit quality of the risk is stupid.
It's just plain stupid.
So from my view,
Point the way that you mitigate the risk around, holding physical
gold, and silver is that you have the contract between yourself and
the storage facility.
That's owned at the very least by a public company.
So that you can quarter by quarter by quarter, look at their balance
sheet and look at their income statement because even in the case of
allocated storage, if you own it, in a facility that goes bankrupt,
you can have an awful lot of difficulty, sorting out your claims from
the other claims and recovering your metal.
There were circumstances in the United States in the second half of
the 1970s where people who had
Allocated metal in facilities where the facility owner himself or
herself went bankrupt, the ultimate owner of the allocated metal
required 12 to 18 months to secure their metal from the bankruptcy
court, which is unacceptable to me.
I have also personally held bullion in safe deposit Bank.
Pardon me safe deposit boxes in
In chartered Banks, where I had some faith in the solvency of the Chartered Bank.
Many people don't like that because they're afraid of bank holidays
or, you know, whatever that sort of thing is.
I'm I'm probably more tolerant of that risk.
The only thing that I can say, their parenthetically is understand
that those safe deposit boxes are designed for wills and trusts, and
passports, the gold and silver are very heavy.
And so if you are going to
Put gold and silver in a safe deposit box.
Get the lowest box on the stack.
You don't want a circumstance which I've seen before.
You don't want a circumstance where the combined weight of various
peoples, bullion Holdings collapses, the stack of safe deposit boxes,
and it's difficult to ascertain who's gold and whose watches are where
it sounds funny.
But there was a circumstance here in Vancouver British Columbia where
I am right now where there was an independent storage facility in the
And 70s safe deposit facility and the consequence of the physical
construction of the safe-deposit.
Boxes was such that enough weight of gold was entered into them.
Remember that?
At that point in time gold ownership was illegal in the United States.
So Americans would come up to Canada and store it here.
Anyway, it tore the stack of safe deposit, boxes off the wall and
collapse them and there was a tremendous mess on the floor of this
dealer where
Quote, secret assets were commingled and well, it's funny to me with
no Independent Record of exactly, who's was his great.
So, it's important to people think about this.
I did this partly to Regale.
Your audience, partly to reinforce the fact that if you are into
precious metals for risk mitigation, think through the whole process
of risk, mitigation and risks and mitigate every risk.
That's controllable the two notes one.
We've gone through before which is to say,
Say that to forty percent of the savings and investment assets of the
biggest investors in the world is comprised by debt instruments, which
are now guaranteed at this interest rate to lose the money at the same
time that the political forces can't allow interest rates to raise
enough to rise enough to give them a positive rate of return and the
second.
Which is the extraordinary low market share of gold and silver, as
savings and investment assets relative to Historic norms and let me do
the arithmetic for you there too.
It's estimated in the United States.
By the way.
I understand that you opened up location United States.
So welcome.
Thank you very much in the United States.
It is estimated that precious metals and precious metals related,
Investments comprise a little less than one half of one percent of the
total.
All value of savings and investment Assets in the US market.
Interestingly, that compares with a 30-year mean of between one and a
half and two percent.
So if the combination of quantitative easing death and deficits and
negative, real interest rates causes people to be concerned about the
maintenance of their purchasing power in other savings and investment
assets.
And they act just a little bit gold.
Doesn't need to win the war against
Bonds, gold doesn't need to win the war against savings products.
It just needs to lose it.
Less badly.
If the market share of precious metals and precious metals related
assets and then States reverted to me demand would triple or
quadruple.
And so, for those reasons, sadly because precious metals do well, when
other things do poorly and I would love everything to do.
Well, for those Reasons.
I'm out.
More.
I think than fairly bullish about precious metals.
I would caution your listeners to understand that when people buy into
this narrative, they buy into it too.
Well, what do you mean by the nice thing about precious metals is when
they move, they move much further than people would expect.
So if you're looking at gold and silver as lifestyle or portfolio
Insurance, a little bit.
A long way if you had a circumstance where precious metals mimicked,
the activity in the first two bull markets, my career 1970 to 1981,
where the gold price went from $35 to 850 dollars an ounce or the Tain
bull market of the first decade of the 2000s where the gold price went
from $253 to nineteen hundred dollars.
What you understand is the little bit goes a long way 10% of your
portfolio in Precious Metals.
Can probably shelter the depredation that will occur to the forty
percent of your portfolio which would occur in bonds.
If you were traditional investor, too many investors hearing this
narrative, go all into precious metals.
They go 100% into precious metals and that denies the fact that while
these bull markets are traditionally a very long duration, 10 years.
They're extremely volatile, and most investors if
They're all in, don't have either the psychological or the financial
staying power to face.
Even a 20 or 25% decline.
History shows us that a 10-year bull market will be punctuated by at
least four 25% declines.
In the first bull market of my careers.
I told you I suffered through a 50% decline in one year in 1975, and I
have to say it shook, the faith.
It's easier to have the financial and psychological staying power of
the market that has that much volatility and that's sort of
periodicity.
If your ten percent involved or 15% involved.
It's much more difficult as it should be.
If you're 100% involved.