But if industry needs 50% of the market a decade ago and now 60% moving to 70, if we see the industrial demand continue, and I’m not talking just photovoltaics, although that’s a great part of it, but also EVs and everything else that we use to electrify the planet, we will see. In theory, industry alone will not have enough silver to meet demand at current mining levels and recycling levels.

Well, hello there my friends. Chris Marquez here with you for Arcadia Economics. And today I’m quite excited to have back one of my favorite guests who I’m guessing most people watching today’s show are very familiar with because of course joined by David Morgan, the silver guru of them, who is one of the people studying the silver market for the longest, quite well known in the industry and certainly with a lot happening in the last couple of weeks, we’ve seen silver get to the higher end of its range and pull up a chart in just a second when we get started.

But most importantly, David, it’s great to see you again as always. And how are you today, sir? Chris, I’m doing well today. We’ve got some sunshine here in the Great Northwest and it’s always a pleasure to see you. So I’m ready. Well, it’s a great time to have you in. Obviously as you and probably most of the people watching this are quite familiar. We’ve had a rally over the past three weeks now.

We’ve seen gold hit new all time highs, saw silver start off a little bit slowly, although here we see it was back down at $22 on, let’s call that February twelveth, almost $3 higher now. Curious any of your thoughts as we’ve seen silver finally catch up actually on a percentage basis, silver up about 13 and a half percent in the past month. Almost double the increase in the gold price.

I guess gold gets more attention since you had the new all time high and silver is still well below its all time high. But perhaps we could start there and just get any of your thoughts from what you’ve seen the past couple of weeks. Yeah, I could only add on really that it’s been frustrating. I mean, with gold leading the way. That’s fine. I have no issue with that.

And I am happy to see silver outperform on a percentage basis you just outlined. I really want to see some sustainability in silver. And the dow theory is like the transports and utilities confirm the industrial and Jim Dimes came up with that years ago. Know you had to have confirmation with silver confirming gold or vice versa. And I kind of buy into that. And so what does that mean? It means that both of them are know, not exactly the same or exactly the same time, but more or less confirming each other.

And for that confirmation to exist, and this is just an arbitrary number that I’ve picked out. Studying silver market for the decades that I have, I put it at a gold silver ratio. And I’d say that the gold silver ratio has to be 70 or lower for that confirmation to occur. And it’s not there yet, although silver is catching up. So I’d like to see silver above 28 and sustain it.

And I’m a little bit concerned, but perplexed that the dynamics and fundamentals of silver are probably stronger than gold on a fundamental basis. And yet it obviously hasn’t kept pace, although it’s catching up. So probably a long answer, but those are my thoughts. Well, that makes sense. And as you mentioned there, on a fundamental basis ties in with something that I’ve been thinking about that we talked a minute about before we hit record yet that bridge between supply and demand and the price.

Because as we’ve seen, let’s say the Fed goes to 0% rates tomorrow and starts QE again. Now, on one hand, you would certainly think on the Comex pricing, which is following and dictated a lot by the Fed, that you would see a rally in silver. Although I’ve been trying to find where and how things are actually connected with what underlies that. Where we have Silver Institute right now has us in a deficit for, I believe, the third or fourth straight year projecting that going forward.

So you could say that right now the supply is not meeting the demand. So at a higher price you get more supply. And perhaps if we are indeed in a deficit and we see that continue, I’m not saying that we’re going to get something that happened similar to the cocoa market, but at least some of the pieces seem to be in play there. Although let’s say the underlying supply and demand doesn’t change, but you just see the price of silver go up on some level.

There has to be the actual demand. Because if we got $75 silver tomorrow, yet if there is not monetary demand, whether inside or outside of the US, maybe this would take a couple of years. But if, let’s say, silver stayed at $75, then eventually you get more supply coming online. So I guess through all of that, what does it take to get an environment where we see a higher silver price, but not a short squeeze that shoots up and comes back down? And even as these monetary events play out, what does it take to get something that is sustained? Yeah, well, there’s a lot to unpack there.

So let me start with this. I think the best way to say if there’s a deficit or not is to look at the above ground silver supply. And if that’s shrinking, you have a deficit. If it’s expanding, you really couldn’t say you have a deficit. You could say there is a deficit based on accounting. There’s this much that has to go to industrial, this much that goes into investment, and there’s a delta.

That’s a negative number. You could say that. But let’s go back to the very basics. We’ll just say rudimentary. I don’t know anything other than what I can visually see and what the facts are. So if you go from 1990 to 2005, there was a deficit for 15 consecutive years of 100 millionoz of silver a year. So it went from about a stock problem, about 2 billionoz above ground in 1990 down to 500 million in 2005.

And yet the price was at like $8. So you would have thought 15 years of consecutive deficit. If that happened in wheat or soybean oil or cocoa or oil, I mean you would have seen a higher price, but not in silver. Why? Well, there’s lots of reasons why. You can read my book silver manifesto and look at the sharp’s law and the ratios and all the stuff we did mathematically to prove that the silver market is managed.

I’ll use that word. So regardless, at some point, had that continued, I mean in theory you would have been out of silver. Had that 100 millionoz continued another five years. It didn’t. The silver supply started to build after 2005, but the mining supply started to come on board in the early two thousand s and we started to build up the above ground supply. So there is a lead lag.

That’s the supply demand. And the numbers don’t seem to add up. Let’s go back to 1980 and talk about the silver squeeze. So if we go back to the silver squeeze in 1980, if you look at January 1979, the all time high for silver in US dollars was about $6 per ounce. A year later it had gone up 850%. In one year silver went up 850%. It went from $6 to 50 plus.

Now it was a one day event, but nonetheless it’s a fact. It got there. So what happened after that? Well, here’s the interesting thing. That after the squeeze, the market came back, it settled down. And we’re silver Thursday in March and all these things that silver nuts are familiar with one thing that Harley Whitney will never talks about is what did the silver price look like after that? And the answer is the average price for silver for the entire year of 1980 was $20 an ounce.

So let’s think about that for just a minute. Let me emphasize my point. January 79, $6 all time high. 1983 times six is 18. So $2 more than that, $20 silver for the entire year. So I would say what we might see is something similar to that. The next time you might get a monetary demand that takes silver all the way up to pick your favorite number, 100 and 5200.

I don’t know. I’m not going for the 1000. Sorry, Chris, I just can’t do that. But I go for 100, I go 150, maybe 200, I don’t know. But we get a spike and then we get a resettlement. Well, the all time high in nominal terms, as we all know, is 50. So let’s say that it shoots up to 150 for talking purposes and settles back down at, let’s pick 75, for example.

So that’s well above the nominal high that it’s been for decades, right? And it averages 75 for the entire year. I’m not saying that’s going to happen. I know the silver market, don’t know everything, never said I did, and probably losing my status as a silver guru, which was kind of a joke to begin with. But regardless, I see it that way. Now, who says that you’re still the silver guru, David? Come on, man.

Anyway, let’s look at the other side. And you asserted, or how I heard it, that if we get to $75 silver, that’s going to bring on more supply and you’re going to have inventory build and that’s going to take the price down in most commodities. That’s true in silver, I’m not so sure. Because if and only if, the projections going forward by such notables as Matt Watson are correct, we are in what Jim Dines will call a natural corner.

So the hunts tried to corner the silver market. You could say yes, you could say no and make up your own mind on it. But if industry needs 50% of the market a decade ago and now 60% moving to 70, if we see the industrial demand continue, and I’m not talking just photovoltaic, so that’s a great part of it, but also EVs and everything else that we use to electrify the planet, we will see.

In theory, industry alone will not have enough silver to meet demand at current mining levels and recycling levels. And we may have hit peak silver. Now, here’s where I have to be really careful, because if you read, and I know you’ve bought the book, silver profits in the 80s, there were silver profits in the 70s. What’s behind the new boom and silver coming? Currency cris. I mean, drone Smith wrote a lot of books, but he projected like $200 silver in the mid 90s or something.

Remember that? And I was at a conference. I’ve said this before, so people can fast forward this if they’ve heard it before, but one of my first conferences, like the second time I spoke in public, and I’m at this wealth protection conference in Phoenix, Arizona, Tempeh, I think, and got through my pitch. And the proprietor, the one that put the event together, let me tell you this, he got kind of puffy with me.

We’ve been hearing about this supply demand thing about know never happened. You guys are know what happened. You know, I said, well, here’s what happened. I go, Jerome Smith made the assumption that the 50 or 60 years of silver mining was 350,000,000oz per year, and it was that way for 60 years consecutively. So he withdrew the conclusion that was going to remain at 350,000,000oz a year. And based on that, we’d be out of silver by mid 90s.

So pick a number. 5150, he said up to 200. And if mining supply had stayed static as he certed or thought in his process, probably would have. Problem was, as soon as the ink dried on that last book, we really got into heap leaching and we upped the supply dramatically. And so that took the price of silver basically down, as you suggested in what you asked me. So I can never rule that out.

There might be a breakthrough in technology or maybe a substitution. There’s really no good substitutes for silver. I mean, yeah, you could substitute platinum, palladium, but they’re a lot more expensive, so you’re not going to do that. But maybe graphene costs more in most cases, but there could be. So I always think ahead, that I don’t want to make the same mistake that he did. But nonetheless, all things being equal, in theory, we could run out on industrial demand alone.

And am I right about hitting peak silver? And the answers depends. I mean, the USGS just came out with their new survey. They had one. I tried to look it up. I spent a long time trying to find couldn’t. I found articles about it, but I could not find the actual USGS printout that at one time they said that silver would be the first element on the periodic chart to go extinct.

And I typed in something along those lines into one of the main search engines, and there were two or three articles I found that quoted that, but I couldn’t find it on the USGS website. But even when they came out with that, and it sounds very bullish, I said the obvious, which you just said, silver mine. Silver is uneconomic at 25 an ounce, and there’s a lot of those because a lot of these mines can only produce at 25.

So it’s like mining for free. Why would you be in a business where you make zero profit? But if silver goes to 150, those mines become quite lucrative, and so you’re going to get more silver above ground because they become economic. So it’s a question, as you already suggested, that depending on the price level, is it economic to mine or not? And the answer is, it’s the higher the price, the more silver that’s just sitting there disseminated.

And it’s not very high grade becomes worth, it becomes economic. So there’s a lot to factor into it. Having said all that, the grades keep going down in the burning ring of fire and the price just stays the same. In other words, Fresneo some of these bigger mines and some of the smaller mines, basically across the board, broad brush. It’s not every single mine. So, David, you’re. It’s.

Look at this mine. Like is silver a few others, but in most cases, from a broad perspective, the grade keeps going down, not up. So that suggests that it’s going to cost more to get it out of the ground because of cost remaining the same. It’s lower grade. You got to push more dirt to get the same amount of ounces. On the other hand, that’s not the only problem.

Energy costs are going to go up, labor costs are going to go up. We’ve got an inflationary bubble that hasn’t been extinguished yet. Even though we get a lot of rhetoric from the Ministry of truth telling us, don’t look over here, everything is wonderful, the economy’s strong, and look at the new averages. They’re making a new high. So back to you, Chris. Well, I know what you mean, and obviously a lot of factors there that we’re guessing how they evolve going forward.

And I think the demand side has changed. Certainly in the 15 years that I’ve been studying and looking at silver where we had industrial demand before, but certainly with the green agenda has taken things to a new level within that. I guess what really got me into the silver market in the beginning was thinking about what happened in 2008, 2009. And then seeing that we still have banking issues.

And really at the end of the day, the big thing to me is the debt, not just on the government, but many governments and corporations as well. And at some point you have extra’s pyramid and you wonder if that flows through. Obviously that would be a big driver in demand. And it’s interesting, we’ve seen a lot of talk. There is no bricks, gold backed currency, yet we see signs emerging that certainly they could be heading in that direction.

We see the central banks buying gold. And I’ve been thinking about how we haven’t seen perhaps a data point like that for silver yet. Although if you go back five or ten years and think about gold back then, maybe outside of the gold and silver community, the idea that we’re going to be using this as money or a store of value, a little harder to believe. But now we’re seeing that on the gold side and I’ve wondered, well, just perhaps in the same way that things change over time as events develop, that if central banks or sovereigns are going to gold, mainly because I think there’s a growing concern about the treasury as a store of value, I mean, it’s not rocket science to look at the supply or look at the yield versus inflation, do you still expect that at some point that we’ll see a similar sentiment carry over to silver as well? That’s a tough, you know, I’ve rethought that several times.

So here goes a long winded answer. So if you look at Professor Jastrom’s book Silver the restless metal, he proves without a shout of a doubt that nothing does better than silver in an inflationary environment. In a deflationary environment, the results are mixed. But that book is decades old. So if we look back at the last from the 1300 to present day, I put that chart up on my Twitter feed just a week ago or so.

I showed the all time inflation adjusted high for silver. 1990, $8 is $800 an ounce, and that’s an $800 bill of 1998, but still is a constant. And then the gold silver ratio never got above 20 for thousands of years. Thousands. And why was that? Well, it was because gold and silver were the exact same function. They were money and money alone. And once silver became industrialized and demonetized by the eastern bankers in the crime of 1873, then silver was Persona non grata, even though we had enough of it to use in coinage and all that through 64.

So the point is that if silver were a monetary metal and used such, it would have a much different gold silver ratio than you have now. Now let’s flip over to the conspiracy side of things and talk about my crypto conspiracy series, where I did 30 interviews. The premise of that is basically from John Perez, and he suggests, for your consideration, that a lot of the money that went into the cryptocurrencies could have, should have, might have gone into the precious metals.

I think that’s a fairly valid argument. So after he made that argument, I did a bit of a deep dive and thought about it, and, well, how do I present this and how do I verify it? And what I discovered is that it could have an effect. I mean, buying a house instead of buying metals has an effect, but we just focus on bitcoin. Bitcoin at the time was about one 10th of the gold market.

So if all that money that was in bitcoin went into gold, would it have an effect? Yeah, could. But it’s 80 times more powerful on the silver side. And what’s interesting is most of the people in the early days of bitcoin were your silver people, because they are the ones that will take the highest risk, take the highest risk to reward profile. So, yeah, I might have a nominal effect on gold, but I have 80 times the power in silver.

So certainly some of that money that might have gone in the precious metals and gone into silver, it could have had a noticeable effect. Is that something that was contrived in somebody’s smoke filled room said, hey, let’s get crypto going and take money away from silver? I highly doubt it. I’m not that big a conspiracy theorist. However, it is an interesting thought study about, I wonder if. And then there’s the flip side of that coin, which means there are gold and silver backed cryptos, which makes it even better, I think, in some ways, than the old days where we actually transferred coins, because you could have it on your phone now, just like a bitcoin, and you can transfer it peer to peer or peer to business or whatever, pretty easily to the grain or Gram, which means you don’t have to worry too much about exact change or any of that stuff.

So there may be a resurgence of silver as money that not too many people think about. From the aspect that you can put it on your phone, you can go from mine to mobile, put it on your mobile phone, and transact and put yourself on the silver standard again. So lots of things in our future, lots of things to be excited about, and lots of dynamics. It depends on the price, depends on supply, demand, depends on is there going to be a monetary aspect of silver again? And it depends primarily on the mindset and people like you have done a great deal to educate people.

And it doesn’t take a lot of new money coming in the silver market because it is so small that we’ll carry it. Once we get up into 30 range, we get above that and that becomes support level. We could get back up into the nominal 50 range fairly quickly because there’s not a lot of overhead resistance above the 30 32 level. Yeah, I know what you mean. And perhaps countering my earlier question, I mean on the other hand you could look at it as that the gold industry has much smaller industrial demand, almost negligible I guess you could say, versus silver where most of it’s being consumed.

But gold in a much higher dollar sized market has still been rising. So you could say that if silver gets that treatment then perhaps that could change things. And it’s interesting, if you take 10% of the US population and they even bought 100oz each, that’s another 3. 3 billionoz of silver, which I don’t know if 10% of the population is going to do that. Maybe some of them would buy a lot more than 100oz.

But certainly like you said, in the environment where we are now, and I guess that’s one of the things that stays in the back of my mind, is that the fed balance sheet and the debt load keep getting bigger. Maybe temporary reduction in fed balance sheet yet. And along the lines with what you said with the cryptos, here’s a question for you. If someone was holding a decent amount of cryptos, let’s say some guy had a million dollars worth of bitcoin back when it’s $3 3000 rather, and they’ve seen it go up to 20, back down, they’ve seen it go up to 60, back down to 20, then up to.

So if you’re going from 3 million to 15 or 20 million coming back down. Now, I know most of the hardcore bitcoin proponents are very steadfast. Yet I would think especially if you have a good chunk of money and you’ve seen those swings, even if you fully believe that it’s going higher and going to be a central part of the world going forward, you’re still a human and you would think up at 63, you might consider diversifying some of that.

No? Yeah, no, it swings both ways and that’s a great point. And I do think that it will happen. It might be gold primarily, but certainly some are moving. The silver market is so undervalued in fact, I remember being in a resource conference at the Brick Vancouver Resource Investment conference early days in the early two thousand s. I forget which year. I’ll just say 2004, thereabouts. And gold silver ratio is about 80 to one at the time.

And I told all the gold bugs in the audience, if you really want to get a killing on gold, buy silver right now at 80 to one. And when the ratio goes back down to 40 to one, swap your silver into gold, you’ll get twice as much gold. And that did happen, and that’s kind of the similar situation here. If you take your bitcoin at whatever, 67,000 and swap half of it into silver at 25 and watch Silver go to 50, and what if bitcoin doesn’t go much above 70,000 for a while? In fact, I just have to interject.

I’m wanting to do probably the last, maybe the final chapter to the crypto conspiracy. I mean, I finished that off probably over a year ago, but I really dived deeper than ever into the whole equation of bitcoin. And there are some things that really concern me. I’m going to put that on, but I want to divert from our conversation. But I get it out. I’ll certainly make you aware.

I’ll let my audience know as well. Any teasers or highlights? Well, yeah. It has to do with an exponential function. And as Chris Martenson has pointed out in some of his lectures, one of the big fallacies of the human race is the inability to understand an exponential function. And that’s what we commonly refer to as a parabolic move or the hockey stick or those kind of thing. If you look at any stock chart, commodity chart, and you see something going vertical, it does not let sustain itself for very long.

It can. And look at Nivia or whatever it is. I mean, that thing’s going straight up, but it won’t go straight up forever. As they say, no tree grows to the moon. So same thing happened in 1980 with the hunts. It went from 15 all the way to 50 in a matter of weeks. It wasn’t like it took a long time to get there once these big parabolic moves take place.

And the thing to understand is that the exponential function is just that. It’s the old game thing about, well, will you take this much for your labor or will you give me one penny on the first square of a checkerboard, two on the next four on the next eight? Oh, yeah, I’ll do the checkerboard. Sounds like you’re never going to get anywhere. But once you start getting into the middle of the board and you double, that’s called compounding or an exponential function.

And that’s only exponential to the two exponential, three, four, five. It’s far more powerful. Bitcoin is a two. It’s an exponential function of two, but nonetheless, I don’t think it can be sustained. So there’s your teaser. Well, there was a great series that you did with John Perez. It’s been a little while since I talked to him, although he’s an entertaining character. Knows a lot about the markets too, so we’ll keep an eye out for that.

And David, perhaps in wrapping up, you can just let people know where they can stay posted with what you’re doing and also how they’ll be able to find out when that series comes out and anything else you’d like to share. Well, thank you. And I just want to circle back to what you said just before my last comment about how precious the precious metal is. So I looked it up before the show and I said, well, how much silver was carried by the average US citizen back in 1900? Okay.

And the average wage back there was about $2. 40 a day. So I’m just going to say that the average person had a day’s worth of wages on him. Because remember, if you didn’t have silver, you had no money. Silver was the money. That’s all it was, money. So 240 a dollar, as most of us really know, and not people that don’t study that hard. One dollars, zero point 77oz is not an ounce.

Even though the treasury doesn’t know that and they stamp one dollars on a 1oz coin, it’s wrong. A dollar is a weight and it’s not an ounce. But anyway, so if you go to $2. 40, that’s zero point 75, I’ll round it down. That’s an ounce and a half plus $0. 40. So an ounce and a half plus 40, I call it 2oz. So 2oz of silver back in 1900 was what the average person had on them.

Maybe more, maybe less. And now there’s what, 330,000,000 Americans, if they all had that 2oz, we’d be at 660,000,000oz. And that’s more than is available on any given year. Because the total silver supply is 1 billionoz. That’s 850 out of mining and 150,000,000 of recycling. 60% of that market is gone in the industry. So you got to take that and you have about 400 millionoz left. Well, you got about 20% or so.

Depends on the year. Say ten in jewelry. So now you’re down to maybe 300 millionoz. And just every American had what they had. 1900 in silver today, which isn’t a whole lot. I mean, 2oz of silver is what, $50? It’s not going to make or break your day. I mean, if you have $50 in silver, unless you buy a lottery ticket, is not going to change your financial status.

And yet we couldn’t do that. There’s not enough silver available to really do that on an annual basis. And even on an above ground basis, it’s always debatable how much there is, but let’s just say there’s equal to gold. Five or 6 billionoz even there, it’d only be a few years supply. So back to you. Thank you. Two things I’ll mention my website, theborghanreport. com. Get on there.

At the top of it, the landing page, there’s icons for our Facebook group, our LinkedIn, our Twitter, and our YouTube channel. And if you’re interested in the documentary I’m doing about the stress and becoming free of this debt based monetary system, I’m doing a documentary called Silversunrise TV. So go to Silversunrise TV. Take a look at that. And if you’re encouraged by what I’m doing and want to join a revolution to put the power of money back into people’s hands, please join in.

Well, that sounds exciting to hear, and I will look forward to checking that one out. And there is Silversunrise TV. And David, just thank you for joining me here today and laying some insight out there for people as we see, it’s weird. On one hand, I would say an exciting time in the gold and silver market, yet it feels like most people still feel pretty beaten up in gold and silver.

But things happening and appreciate everything that you’ve done in studying and teaching others about the silver market and actually listening to the silver manifesto audiobook right now. So been enjoying that one again. And you just take good care of yourself. I know people always appreciate hearing from you, and we’ll catch up and do this again sometime soon. Thank you, Chris. Appreciate the time. Well, thank you, David. Sure was nice to catch up with him, as always.

Obviously someone who has been studying and analyzing the silver market for quite a long time, and someone that I know people enjoy hearing from one of my great teachers on this journey. So hope you found that helpful at home. And before we wrap up, I did want to thank silver Viper Minerals, who brought us today’s show. And Silver Viper, as you may know, has its La, Virginia gold silver project, where they had their discovery at El Ruby, which has been the basis of a 49 million ounce silver equivalent resource estimate as they have found high grade gold and silver throughout El Ruby.

And they’re still on track to be releasing an updated resource estimate and also looking forward to going out drilling again hopefully sometime later this year to further define what they have there, as well as to test some of the new targets that they have uncovered during their mapping and sampling plans. So can find out more about silver Viper@silvervipermininerals. com and certainly if we are on the verge of a Silver rally, a company to take a look at and find out more about.

We’ll be having Steve Cope of Silver Viper back on the show probably next week, so hear more about it from him. But in either case, thank you to Silver Viper and thank you to David and everyone watching at home. Hope you enjoyed today’s show and we will see you again soon. .

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