Market Analysis by covering: Gold Spot US Dollar, Silver Futures, FTSE 350 Banks. Read 's Market Analysis on Investing.com
Stock market today: S&P 500 ekes out closing record high despite wobble in chipsIn a dramatic speech to the Democratic National Convention in 1896, William Jennings Bryan declared these famous words. Bryan, the Democrats’ nominee for President, was a staunch opponent of the gold standard.
Instead, he advocated for a more prominent role for In the late 1800s, political movements—primarily centered around the Democratic Party—began pushing for inflationary policies. But the gold standard was a major obstacle. It imposed a strict limit on the government’s ability to redistribute wealth through inflation. Unbacked fiat paper money—like the inferior currency we’re forced to use today—was not an option back then. That’s why the Democrats and other inflation advocates rallied behind the easiest form of money available: silver. For example, farmers lobbied for inflation so they could repay their debts with cheaper dollars. In response, Congress passed the Sherman Silver Purchase Act, requiring the US government to buy set amounts of silver to support its price and trigger inflation. It was in this context that Bryan made his powerful speech condemning Ultimately, their efforts failed. Bryan lost the election, and the US did not adopt silver to make inflation more feasible. It was a temporary victory for hard money advocates. But it wouldn’t last. In the decades to come, the US would move to a far worse form of money than silver: unbacked fiat paper currency.First, it demonstrates how hard money frustrates the ambitions of spendthrift politicians—and that’s a very good thing. Second—and more importantly—the triumph of gold over silver is a powerful example of an economic principle few people truly understand. Grasping this concept is essential to seeing the Big Picture and making transformational profits in the months ahead.Gold is a superior form of money compared to silver—except in one key area. Physical gold isn’t convenient for small transactions. The smallest practical unit of gold is about one gram. As of this writing, that’s worth around $100—which is not insignificant even in today’s debased dollars. That’s where silver historically came in. Throughout history, silver was more convenient for day-to-day use. It earned the reputation of being the “gentleman’s money,” while gold—with its higher value density—was the “money of kings.” But by the late 1800s, silver’s edge in small transactions began to erode. As the banking system matured, there was less of a need for people to carry around physical metal.started issuing paper currency backed by gold. This made it much more practical to use gold—even for small payments.It was a clear illustration of how people naturally gravitate toward harder money, even if it means relying on third parties like banks. In other words, people chose harder money with counterparties over easier money without counterparties . As a result, silver’s monetary role—which had lasted for thousands of years—fell into sharp decline. It never recovered. Silver became primarily an industrial metal, with only a small remaining monetary premium. That status continues to this day.Let me get straight to the point: there’s only one reason I’m interested in silver.I’m not interested in its industrial applications either.Silver is a small market with enormous speculative potential during periods of monetary chaos—like the one we’re now entering. Silver does have some monetary demand, but it’s usually too small to meaningfully impact the price. However, during periods of monetary chaos and runaway inflation, people rush into alternative forms of money—assets that hold their value better than rapidly depreciating government paper currencies. It’s in these moments that silver often sees a stampede of demand. And because the silver market is so tiny—roughly one-tenth the size of the gold market—it doesn’t take much to overwhelm it, triggering sharp price spikes. Further, the combined market cap of all silver stocks is less than 1% of Microsoft’s market cap. It’s also less than 1% of NVIDIA’s. Less than 1% of Apple’s.I like to think of silver as an industrial metal with a call option on inflation and monetary chaos—something that could arrive sooner than most expect. Silver’s monetary demand tends to soar during periods of high inflation. As money floods in, the price surges. It’s happened before, and it could happen again—soon. Just look at the story of the Hunt brothers. During the high inflation of the 1970s, they bought as much silver as they could get their hands on. That aggressive accumulation squeezed supply and helped drive silver from around $6 in the late 1970s to nearly $50 by 1980. Today, the stage is set for another inflationary explosion—likely even more severe than what we saw in the 1970s. It could trigger a crisis-driven silver mania, much like the one that peaked in 1980. Adjusted for inflation, $50 silver in 1980 would be worth over $187 an ounce today—many times higher than the current price. Silver mining stocks could deliver even more dramatic gains if we see a similar move today.The stars are aligned for a silver price spike of historic proportions. The time to get positioned is now.Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks. Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.would like to remind you that the data contained in this website is not necessarily real-time nor accurate. 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