by Gary Christenson, Deviant Investor:
How low and how high will the price of silver range on the PAPER markets during 2017? Knowing the influence central bankers, politicians, HFT algos, bullion banks and JPMorgan exercise over increasingly managed markets … it is impossible to answer the question, and it is probably the wrong question to ask.
Instead, what do we know with a high degree of certainty?
- The U.S. national debt will substantially increase as it has almost every year since 1913. We can trust politicians and central bankers to act in their best interests to spend in excess of their revenues and increase total debt. See chart below.
- Politicians and central bankers are unlikely to change a century of their spend, borrow, tax and inflate behaviors.
- The price of silver on the paper markets will be volatile but, over the long term, will exponentially increase as it has since 1913.
- Silver prices relative to their own history and to the S&P 500 Index are low and far more likely to rise than to fall further. See charts below.
- Silver prices will, like the national debt, consumer prices and currency in circulation, increase. The inevitable long-term direction of silver prices is upward.
- Silver prices are currently low by many measures so the probable move higher should be substantial. Risk of lower prices is small.
What analysis supports these conclusions?
Plot the official national debt on a log scale every four years – presidential election years. The exponential increase (about 9% per year – every year) is unmistakable. Doubling debt approximately every eight years is not a winning strategy for the U.S. economy. Take cover!
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