The Gold to Silver Ratio is Indicating a Massive Move Higher for Silver

At the current time of writing, gold and silver are suffering under a renewed attack, with the former losing $16.54 (1.08%) throughout the trading day and the latter down by $0.20 (1.11%).

Yet, this is not a time to despair, as both gold and silver are showing incredible resilience, adapting and adjusting to these difficult times, with gold holding solidly above the $1500 mark and silver smashing through the $18.00 per ounce level.

This smash lower came just as silver was rocketing towards the $19.00 mark, after quickly passing through its previous resistance levels in prior trading sessions.

The reasoning for these metals moving higher are many fold and have been discussed at length on the Sprott Money blog and most, if not all of these contributing factors are still solidly in place.

The China / US trade war is giving no indication that it is going to come to a close anytime soon, despite President Trumps apparent softening in his approach over the past month, he has once again renewed his efforts and gone on the attack, stating that he regrets not raising tariffs higher on China.

The Fed's are clearly not the only masters of doublespeak.

Obviously, this is an attempt to keep the markets chugging along, while at the same time, trying to force the Fed's hand in lowering rates even further.

I believe that ultimately the Federal Reserve is going to do just that, as they know that the global economy is not healthy and is on the verge of a major recession.

Rates are going lower and that means that both gold and silver are going to adjust accordingly, moving higher in lockstep with lower rates and as investors seek the unique safety that only these metals can provide.

Despite believing that both gold and silver are ultimately going higher, I also believe that silver is destined to outshine gold in price gains, but why?

Good question.

The answer is simple, the gold to silver ratio and the fact that it is currently indicating by all historical standards that silver is very, very underpriced.

As it stands right now, the gold to silver ratio is approximately 85:1, meaning that it takes 85 ounces of silver to buy 1 ounce of gold.

To find the gold to silver ratio, all that you need to do is divide the current gold price by the current silver price.

Just for reference, here are some historical comparisons:

• The ratio of gold to silver in the earth's crust is 17.5:1.
• In ancient Roman times, the gold to silver ratio was set at 12:1.
• In 1792 the gold to silver ratio in the United States was fixed at 15:1 by law.
• In 1803, France set this ratio at 15.5:1.

Even if you disregard all of the above, and use much more recent numbers, the average gold to silver ratio over the past two decades still stands at 60:1, indicating that our current 85:1 ratio is horribly out of alignment and in need of a major adjustment.

This means that even if gold was to remain at its current price levels (something I don't believe is going to be the case), then silver would still have to move higher by roughly $7.00 per ounce, just to reach the more recent, modern day averages.

However, it is very likely given the fundamentals that gold is going to move higher, as David Rosenberg, Gluskin Sheff’s chief economist stated in a recent interview.

He believes that $3,000 gold is a very real possibility, which would mean that silver would need to move to roughly $35.00 per ounce, just to maintain todays current, historically out of whack ratio.

If silver out-paces gold, returning to a more healthy 60:1 gold to silver ratio, then this would put silver at $50.00 per ounce, nearing its all time high.

Either way, we are looking at incredibly impressive gains if gold and silver continue down the current path they are on, heading incrementally higher as the months and years progress.

The printing presses are not slowing down, the Fed is in all likelihood going to lower rates, just as the markets are demanding they do and the 2020 elections are just over the horizon, bringing with them massive turmoil and chaos.

Gold and silver are destined to move higher. Their time to shine is now.

- Source, as first seen on the Sprott Money Blog

Secret Revealed: Why Silver is Spiking

Why is silver going up? Good question, and the reason for the price spike in silver is surprisingly simple. 

Tune-in for discussion on what's going on in the economy & markets in general, and gold & silver specifically... especially silver!

- Source, Silver Doctors

Frank Holmes on the State of the Gold & Silver Markets

Frank Holmes, the CEO and Chief Investment Officer of U.S. Global Funds, helps us look into the future with has strong understanding of gold and gold shares markets.

- Source, Jay Taylor Media

Ted Butler: JP Morgan Busted ONCE Again

Another strong week for monetary precious metal values. The silver spot price is trading late this week around 17.50 oz in fiat US Federal Reserve notes. 

The gold spot price is trading $1,530 fiat US dollars per troy ounce near the end of this week’s trading. 

The Gold-Silver Ratio has ticked 1 troy ounce lower this week. It now takes 87 derivative ounces of silver to acquire 1 derivative ounce of gold. About 9-months ago, we last spoke with this week’s Metals & Markets Wrap guest, regarding the first, long time JP Morgan precious metals derivative trader, admitted guilt to financial fraud and market crimes committed. 

This week, we welcome back long-time silver analyst, Ted Butler to the show. To discuss yet another guilty plea this week by another over decade long executive director from JP Morgan’s precious metals trading division for the financial market crime of spoofing. We hear Ted’s take on the US Justice Departments various indictments of precious metal market criminals over the past year’s time. 

As well, we also discuss a likely massive silver trade which has formed in the last 3 months, in three of the most major silver ETF derivatives. To the tune of a silver bullion hoard the size of both the former Hunt Brothers and Berkshire Hathaway’s Warren Buffett. 

We discuss who is possibly making a multibillion-dollar move into the physical silver investment market and what this kind of movement may portend for some of the precious metal derivative trading entities on the short side of silver moving ahead.

- Source, Silver Doctors

The Libra World Currency: A Cashless Society is Coming, Beware

In a stunning admission, one of the worlds top central bankers said the following to say about the dollar. 

“Mark Carney, titled "The Growing Challenges for Monetary Policy in the current International Monetary and Financial System", where he dedicated no less than 23 pages to a stunning - for a central banker - cause: to describe why the dollar's "destabilizing" reserve status role in the world economy has to end, and why central banks need to join together to create their own replacement reserve currency. 

One potentially tied to Facebook's new "stablecoin" Libra, although in reality any "Synthetic Hegemonic Currency" as Carney defined it would do.”" the short term central bankers must deal with the situation as it is. 

But he also warned that “blithe acceptance of the status quo is misguided,” and dramatic steps will ultimately be needed. It's what he said next that was stunning: In the longer term, we need to change the game," Carney said. 

"When change comes, it shouldn’t be to swap one currency hegemon for another."

- Source, WAM

USA Watchdog: Globalists May Try to Crash Economy

Journalist Alex Newman’s biggest fear is the New World Order tanking the global economy to try to tarnish Donald Trump before the 2020 Presidential Election. 

Newman says, “We may see the globalists try to crash the economy, whether that be pulling the rug out from under the stock market or whether that be trying to crash the value of the dollar. 

Then using that to demonize President Trump and all of his supporters and to basically say see what happens when you defy globalism. See what happens when you try to implement tariffs so the communist Chinese don’t rip you off. 

You end up blowing up your own economy. They are going to say this is all Trump’s fault and the fault of the people who voted for him. 

I think this is a very real possibility...

- Source, USA Watchdog

Strong Retail Numbers and a Divided Fed Send Markets Spinning

The annual Jackson Hole, Wyoming Federal Reserve symposium began today and markets, as expected, were a nervous wreck, gyrating and throwing their typical temper tantrums.

The reasoning for the chaos that was unleashed throughout Thursdays trading season were numerous, but the one above all others that sowed doubt in the market's collective mind, was the recently released July 30-31 Fed minutes, which showed that the members of the board were incredibly divided over the quarter point rate cut.

Some members believe the economy is healthy, while others believe that the ongoing trade wars, that seemingly have no end in sight, pose a significant threat to not only the United States economy, but the world as a whole.

The divide heading into todays and tomorrows meetings is likely now only going to get worse.

Recently released impressive retail results posted by companies such as Nordstrom, Lowe's and Target, all of which are trading higher due to better than expected results, paints a promising picture of the US economy as a whole.

Nordstrom in particular is up by 10% in today's extended trading session alone, due to better than expected quarterly results fueled by growing digital sales (up 4%) and reduced inventory (down 6.5%).

This is a massive gain and as some Fed members are likely to argue, shows the true strength of the  economy, while other board members are going to continue to point to the deepening concerns surrounding the trade wars.

The markets hate uncertainty, and that is unfortunately exactly what we currently have as everyone holds their breath, waiting for the highly anticipated speech by Fed Chairman Jerome Powell.

This uncertainty caused the S&P 500 and Nasdaq to nose dive early on in the trading season, only to slightly recover as the day's trading action unfolded.

Reacting to this negative trading season, President Trump once again went on the attack and engaged in his own form of double speak, both talking up the economy while also encouraging rate cuts, which seemed bizarre to many.

Hoping to spur the Fed into action, the President had the following to say via his Twitter account;

"The Economy is doing really well. The Federal Reserve can easily make it Record Setting! The question is being asked, why are we paying much more in interest than Germany and certain other countries? Be early (for a change), not late. Let America win big, rather than just win!"

Gold and silver bullion also traded slightly lower, as precious metals responded as the markets did, taking the strong earnings from the retail sector as a sign that rates may not be lowered next month, as many anticipated they would be.

However, I wouldn't rule out a rate cut just yet, as I personally believe that the threat to the global economy due to increasingly unstable geopolitics is a much greater threat than anything else currently ongoing.

The trade wars, and the powder keg of a situation in the Straight of Hormuz could upset the proverbial "apple cart" at any given time, sending the global markets crashing lower and precious metals catapulting higher.

I believe Fed Chairman Powell knows this, and despite the jawboning and double speak that you are going to hear from him tomorrow, he is ultimately going to move forward with this at the front of his mind.

Lower rates are ultimately coming, if not next month, then soon, very soon.

Easy money is here to stay and precious metals are destined to go higher.

Until then, enjoy the discount and keep stacking.

- As first seen on the Sprott Money Blog

Silver Fortune: Why are Gold and Silver Rising with the Dollar?

It's all about safe haven demand and the irrationality in the bond market.

- Source, Silver Fortune

Jim Grant: Cycles Begin and End In Excess

Gold now pays better interest at 0 than $13 trillion in negative paying bonds! 

Socialized Risk: Big boys get winnings & tax payer takes all losses. 

Bagehot: Central Banks should lend at very high interest rates & only with collateral.

- Source, Golden Rule Radio

Tom Luongo: The Mother of All Safe Haven Trades Has Begun

As the sovereign Debt Crisis unfolds, we have now entered the SafeHaven trade with Gold. 

Tom Luongo says it's "the mother of all safe haven trades". Investors will also seek out safety in silver, but what about the dollar? 

Tune-in for the answer to that question and a whole lot more! Today we welcome first-time guest Tom Luongo to Silver Doctors. 

Looking for independent, free-market and alternative analysis with just the right blend of market, economic, political and geopolitical analysis? Then look no further!

- Source, Silver Doctors

Scaramucci Talks Gold Price and Market Volatility; Weighs In on a Gold Standard 2.0

Gold is a near-term safe haven asset, said Anthony Scaramucci, but the hedge fund manager and former White House Communications Director sees potential in other assets on a longer-term basis. 

“It’s a near-term safe haven but long-term it really doesn’t solve people’s problems,” Scaramucci told Kitco News. “I would prefer to put the money or the capital into assets that I think are actually going to return something as opposed to be waiting for other people to think it’s more valuable to me in terms of where my entry point is.” 

Scaramucci noted Warren Buffett’s view on gold, which is that the yellow metal’s value is derived from its finite supply rather than contribution to productive economic growth.

- Source, Kitco News

Inflation Rising: Consumer Goods Prices Increase by Most in Seven Years

The trade wars are taking root and finally, finally the damage is starting to ripple through not only Wall St, but Main St as well, as inflation steadily ticks higher.

This comes on the heels of a rate cut last month, in which one of the reasons why the Federal Reserve acted, was because they believe inflation was too low.

This is laughable that this is even a reason to act and it just goes to show the complete disregard that the Fed has for the average person on the street, who works hard their entire lives, saves for retirement, just to see those saving slowly chipped away by an easy money policy.

The Federal Reserve has a 2% inflation target, a target that until recently they believed they would not reach.

That may however be about to change, as the Labor Department stated on Tuesday that its consumer price index increased by 0.3% last month,  surpassing some analysts expectations.

Meanwhile, CPI Goods are up 0.4% year over year, which is the highest level since November 2012.

Relatively speaking, these levels are minor and nothing major to worry about, but what is truly worrying is how the Federal Reserve openly admits that they would love to see inflation rise to higher levels.

Rest assured that this recent uptick in inflation is going to do nothing to change the Federal Reserves easy money policy that they have embraced, the printing presses are going to continue working in overdrive and the markets are still highly anticipating an additional rate cut at the next months Fed meeting.

Both Goldman Sachs and Morgan Stanley are amongst those who believe that more rate cuts are on the way, with Morgan Stanley even going as far to predict that rates are going to return to zero, which is pure madness.

These additional cuts are only going to fuel inflation to even higher levels.

Sadly, more pain is on the way as we have yet to see the full ramifications of the ongoing US - China trade wars, that continue to loom over the worlds head.

Next month, on Septemeber 1st, an additional 10% in US tariffs are set to be enacted on Chinese goods entering into the country. It is expected that this will affect roughly $300 billion worth of imports.

Once again, these tariffs are going to hit consumer goods the hardest, as that it predominately what is imported from China, meaning that new highs in the CPI goods are likely on the way.

This strategy to drive prices higher and force companies to move the production of their goods to other countries is working, as I have recently highlighted, however, it is undoubtedly going to cause some short to medium term pain for consumers as well.

President Trump once again inflamed the divide between the United States and China, taking to twitter to launch a renewed attack on Tuesday;

"Through massive devaluation of their currency and pumping vast sums of money into their system, the tens of billions of dollars that the U.S. is receiving is a gift from China. Prices not up, no inflation. Farmers getting more than China would be spending. Fake News won’t report!"

No one is going to come out unscathed from these trade wars.

Sadly, it appears that we are going to be entering into a new era of rising inflation, as the Fed continues to be beholden to the markets, maintaining an easy money policy and as consumer goods prices continue to rise due to the ongoing trade wars.

Fortunately, this is exactly where precious metals come into play and as we have witnessed recently, are doing exactly what they should do in their time of need.

Most notable has been gold, as it continues to maintain above the crucial $1500 level, despite suffering repeated attacks from those who would love nothing but to see it brought lower.

If these trade wars are not rapidly brought to a close, then I believe that gold is destined to go higher, much higher, possibly even testing than breaking through old highs, with silver rapidly following suit shortly after.

The trade wars continue on, the easy money policies continue on.

Keep stacking.

- Source, as seen on the Sprott Money Blog

Steve Keen: Could A Debt Jubilee Really Work?

One way or another, we're going to have to address the $trillions of outstanding bad debts. 

Over the past decade, the world’s central banks have distorted the price of money by bringing interest rates to record lows. 

With credit so cheap, asset prices have risen dramatically as companies and governments have borrowed to the hilt. 

And now with the “Everything Bubble” threatening to burst (perhaps in mid-bursting already?), we’re suddenly realizing that the phantom asset price gains were ephemeral, while the debts are permanent. 

How will the economy cope with dangerously overleveraged nations, industries and households? Not well.

- Source, Peak Prosperity

Rob Kirby: Protect Your Money Before It's Too Late

You've been warned. You're enjoying the rising tide that's lifted your IRA, 401-K, and home valuation.​.. 

You know you're at risk... 

You know you're riding on a bubble... You've told yourself you'll take some steps to deal with it... Some day... Pretty soon... But you've gotten too busy... 

And on the news, and the president, and lots of people are saying everything's going to be okay... But you know in your gut everything's NOT okay. 

Rob Kirby, experienced credit and precious metals expert, proprietary analyst, and founder of KirbyAnalytics.com, returns to Reluctant Preppers to answer YOUR viewer questions, and to offer us his characteristically honest insight.

- Source, Reluctant Preppers

Wolf Report: Fuel for the Next Mortgage Bust?

Here we go again: Cash-out refi hype is back full-blast, and for the first time since early 2006, people are doing it.

- Source, The Wolf Report