The Silver Hurricane Why Industrial Demand is Triggering a Parabolic Move

Every single loan, the currency is created out of thin air. Fake money, dollars. Someone's out there printing them while you're out there working for them. It's completely unfair. We're printing currency like crazy. And on the industrial side, they're demanding more and more for EVs and solar and everything. And so silver is resting right in the middle of those two hurricanes. And that's why we're seeing the price go up. 1971 when we abandoned the gold standard and we all just started using this fake money, dollars. It's just a piece of paper. And like someone's out there printing them while you're out there working for them. It's completely unfair. And we all just play that game and pretend like it's okay. It's been 54 years. And uh it's just like you just regain your senses one at a time. Either you read Rich Dad Poor Dad or you just, you know, change your career and start thinking about this really intensely or whatever it is. And then you have these aha moments where you're like, "Oh my gosh, the dollar is a total scam." But like all your friends and family still believe in the dollar and they want to work for dollars and they think in terms of dollars and how do I get 4% or 7% on my dollars and it's like you know people will live their entire life just thinking that way. They won't wake up. So what's going on here? Because I know that we've lost I mean for me it's 50% purchasing power on my money in the last 5 years. I know and you can tell me it's 2% inflation but I know that a Chipotle burrito used to cost $6 and now it's $12. And that's that's half. So, you know, I can buy half a burrito for what I used to be able to buy one for. That's a that's a huge loss of purchasing power. So, what's happening? Okay. Yeah. So, the short version is currency creation. So, um because the dollar is not backed by anything, it can be created out of thin air. So, anytime you swipe a credit card or you borrow student loans or you take out a loan for your mortgage or a car payment or whatever or a small business says, "Hey, let me borrow a h 100red grand for whatever." Every single loan, the currency is created out of thin air. And so, basically, the bank just makes it. They just make it out of thin air. Every single loan. So, the bank loans me $100,000 of free of money they made up and then I owe them back $100,000 plus interest. That is correct. Wait, they don't have to have the $100 before they they loan it to you. Correct. So there's there's a hu So you guys know fractional reserve lending. So a lot of times the way that's explained the way a lot of times the way that's explained is very close to correct. It's close to correct with one important caveat which which I can explain. But then co in COVID March of 2020 the Federal Reserve abolished fractional reserve lending and there is no fraction anymore. So there's no requirement. So that small that small caveat which was maybe just like an interesting nuance, it now becomes like the main central thing which is kind of what I said. So the way fractional reserve lending was explained historically or typically is like if you if you deposit $100 into the bank and there's a 10% reserve ratio, the bank has to keep 10 of those dollars and they can loan out the other 90. And then if that 90 goes into your pocket and you put that 90 in the bank, the bank would have to keep nine out of the 90 and can loan 81. And then it goes on and on and on. If the money they just made gets redeposited back into their account, they can fractionalize that now and make more money basically. Yeah. Exactly. And so that you follow that chain, you know, until an asmmptote. Um and then you basically can multiply the currency supply by 10. And so that's a helpful way to think about it even though it's not technically true. It doesn't technically work that way. Again, this may be like a it's broadstrokes. Yeah, generally speaking. So, if you if you can wrap your head around that, that's probably helpful enough. But really, the way it works is anytime you want a loan, it's all created out of thin air. And then every two weeks, the at the end of every other Wednesday, this is just what the Federal Reserve rules are, or they were, um, the banks had to have a certain coverage ratio. So you then you could think about like oh after 2 weeks of currency creation unlimited they somehow have to come up with 10% or whatever the ratio is at the time to cover all the outstanding deposits if that makes sense. So it's not like Yeah. So if you So they're not limited by the deposits at the time of creation you know the $10 check on in a few weeks they just get checked on and in in practice there's all these different lending markets between the banks between the Federal Reserve. They can always find some currency here find it there. So they really weren't limited in that way. And like I said in 2020 they just did away with the reserve requirements. So now no bank has to have any reserves at all ever. So if you go to the bank and you want c they have to have no cash in in a branch there. There's no obligation to have ATMs. There's no obligation to have any reserves electronically. So you could go into your bank and it's been this way for five years. Uh almost six. You could go in there and they can just say, "No, we we do not have your currency. We don't have your money." No. So that could happen. So we're So we're printing a lot of money and that's what's made and so more dollars are coming into the system and that's why we're losing our purchasing power. Yes. But so silver and gold are going up because we can't print a lot more of that print. We can mine it, but we're consuming it and basically more dollars are being made than gold or silver. And so that's driving the price of silver and gold up. That is the simplest way to understand it. Yes. Yeah. You can't print gold and silver. You have to spend energy to create them, but you don't have to spend energy to create dollars. So what's going on with silver then on the industrial side? Yeah. So silver is a very interesting metal because it is primarily an industrial metal. So most of the silver that we mine, more than half, slightly more than half is used in industry. It's used in consumer electronics, solar panels, mirrors. I mean it's all like thousands and thousands of products. So most of the silver is used in industry. We're in a situation now where all these different industries all over the world um green energy technologies, you know, electric vehicles, all the batteries, all these things, AI, data centers, yeah, solar panels, all this stuff. of the whole green energy revolution. They're demanding more and more and more of everything but silver especially and we're not mining enough silver every year. So for the last 5 years we've actually been in a structural deficit meaning the demand for silver each year exceeds the supply. So that means in order to satisfy demand we have to eat into existing stockpiles and price is going to go up to you know reach equilibrium in supply and demand. So that's kind of the main thing that's happening in industry right now. And as that happens, people are sort of reminded that silver is also a monetary metal, right? So like I own silver, but it's not because I'm making solar panels in my basement, you know? Like it's because I think of it as money and I know it's going to allow me to buy more burritos like in the future. Uh you know, and and dollars are not going to not going to cut it. So uh so as the price of silver goes up, we talked about it being like a gifining good. um people tend to want it more and more as money. So people get interested in silver as money. So it's a very interesting metal because it has both an industrial side and a monetary side and not not many other metals are in straddle both camps. So it seems like we're in the midst of two hurricanes going on right now because geopolitically things are not going you know they're uh they're more volatile than ever. It doesn't matter whether you think what's going on is good or bad. The reality is it's more volatile, which is not helpful for a currency. We're printing currency like crazy. And on the industrial side, they're demanding more and more and more for EVs and solar and everything. And so silver is resting right in the middle of those two hurricanes. And that's why we're seeing the price go up. And you're saying we're not making enough silver every year. How much, like what's the ratio? How much are we making versus how much the world is consuming? Yeah. Um, off the top of my head, I'm pretty sure we covered we produced about 90% of what we needed. So, that other 10%. Is that is that kind of what you're looking for as a way? Yeah. Okay. Um, that other 10% is coming out of existing stockpiles. And those existing stockpiles can still last like more than a decade, but these things don't move linearly. So, it's like as pressure builds up, you start to get exponential forces in different directions. So, that that's why the price starts moving parabolically.