The Truth

Have you watch the video? Please watch. “The Truth” is a highly awakening video everyone should watch. Really.

If you are now in certain form of debt (including credit card debt, personal loan, car loan, Ah Long debt, or any other creative debts), this did not happen by chance. The global monetary system is designed to get you into debt. The more debt you have, the more powerful “they” have over your life such as indirectly forcing you to cling to your job. When it comes to money, nothing happened by chance. The truth is, EVERYTHING is there for a reason and the reason is usually NOT benefiting you. Monetary system could simple if you understand how it works; but if you don’t, I recommend you take your time to look at these FREE educational videos I have compiled over long period of time.

Last week, I shared Rio Tinto’s Kennecott which contributes to US 16% annual silver production has landslided. This mine will likely shut down production. 5 million oz of annual silver supply (and 500,000 oz of annual gold supply) is vanished.

This week, I will share with you more precious metal mines are closing down due to the recent crash of silver (and gold) price. For the miners, it is simply not worth the cost to bring out new metal when the production cost is higher than the gold & silver price they can sell for.

1. Drumlummon Mine, United States

Miners drill holes on a grid pattern in the Drumlummon mine in 2010

Miners drill holes on a grid pattern in the Drumlummon mine in 2010

U.S. Silver & Gold is shutting down its historic Drumlummon mine because it costs more to produce an ounce of gold than it’s worth, the company announced on April 24, 2013.

During the first three months of 2013, the mine near Marysville produced just over 2,100 ounces of gold at a cost of nearly $2,300 per ounce. At the point of  the announcement, gold price was only $1,431. To put this into simple  layman terms, no businessman would want to continue an operation that requires RM2.30 to produce a product that can only be sold at RM1.40. Fair?

2. Pascua Lama, Chille

Pascua Lama

Pascua Lama is supposed to bring 700,000-800,000 oz of gold and 35 million oz of silver annually. Barrick (the company) is considering permanently suspending the Pascua Lama project. Barrick CEO, Jamie Sokalsky said “we are working to address the environmental and other regulatory requirements on the Chilean side of the project“. Do note that the shut down of Pascua Lama is due to environmental issue rather than silver & gold price crash. However, this would impact the global supply of physical gold and silver severely.

Knowing that for every 100 oz of paper silver being traded, there is only 1 oz of physical silver back them. For every 1 oz of physical silver that you buy at current suppressed price, you are making the silver manipulators to walk on a thinner layer of ice and helping to bring silver back to their true value.

Silver short term price movement might not be too exciting. Last week, I shared that silver price is “potentially” going to $20 within the next few weeks. Of course, do not know for sure if that would happen. But I will share with you what I observe:

Descending Triangle is one of the patterns in Technical Analysis. We draw one trend line that connects a series of support and a series of high. Once the breakdown occurs, the price is potentially going lower.

Descending TriangleHere is how silver price chart looks like:

Click on image for full resolution

Click on image for full resolution

How low would it go? I do not have the answer. However, during such suppressed price, I see it as an great opportunity to buy silver at undervalue price.

The MOST interesting part about our current situation is, regardless how low silver price, you might NOT be able to buy physical silver. Click here to see some proofs of physical silver shortage happening in both our Malaysia local silver stores and other silver stores in overseas.

Assuming that there is silver, premium (which contribute to the final purchase price) is much higher than it used to be. The premium for silver bullion is being updated 2 to 3 times in a week. The disconnection of silver spot price and physical silver is obvious and getting wider. Right now in US (a matured silver marketplace), it has been reported that some dealers are charging premium of more than 25%.

Looking at the silver chart earlier for the potential downtrend. This could be just the beginning. So, EVEN if silver price drop to $11, PHYSICAL silver might be selling at $30, $60, or even $100. In fact, I would be worried for you if you could still find silver at that time.

Silver Malaysia eBookTo find out more about silver investment, take a look at eBook: Practical Guide For Investing Silver In Malaysia. You will find out where I personally buy my silver from and my review on the dealers.

2 thoughts on “The Truth

  1. Hi Daniel, can we recycle silver? So that silver shortage will be reduced and it is hard for us to sell our physical silver to the industrial. If one day there is no more silver, gold still can replace silver in the industrial.

  2. Yes you can recycle silver but I suggest you don’t bet on it. When you buy your silver, you have paid for certain amount of premium to get the silver minted in a much presentable form. Industrial player do not value the premium portion, they will only buy for the silver content itself. No, gold cannot replace silver in industrial application. Furthermore, gold price is too expensive to be used for industrial application.

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