Even with silver trading near an all-time high at $53, the silver price remains radically undervalued vs the 1980 high.
Silver
November 14 (King World News) – This is a small portion of Jesse Colombo’s fantastic report on silver: … we will look at silver in relation to another measure of inflation: the U.S. M2 money supply. The money supply may be an even better indicator of inflation than the CPI, which is known to understate actual inflation (learn more). Moreover, growth in the money supply is the underlying cause of inflation itself. As Milton Friedman, the Nobel Prize–winning economist, famously said, “Inflation is always and everywhere a monetary phenomenon.”
During the secular bull market of the 1970s, silver measured against the M2 money supply rose by 1,670% over 98 months. In the 2000s secular bull market, it gained 634% over 113 months. In comparison, the current secular silver bull market is up only 195% over just 37 months. This is yet another indication that the current bull market is still quite young, and those claiming it is long in the tooth are clearly out of touch with the objective facts.
KING WORLD NEWS NOTE: Silver Radically Undervalued vs US M2 Money Supply Compared To 1980 High
Another novel yardstick I have been experimenting with lately for comparing precious metals and commodity prices is the U.S. national debt. After all, the more the national debt grows, the closer that brings us to the final ultimate fiscal crisis, which will then open the floodgates of digital money printing. That, in turn, will cause a currency crisis and hyperinflation, which will send precious metals to prices that our minds can barely comprehend.
During the secular bull market of the 1970s, silver measured against the U.S. national debt increased by 1,736% over 98 months. In the 2000s secular bull market, it rose 410% over 113 months. In comparison, the current secular silver bull market is up only 160% over just 37 months—a sign of a young bull market that still has a lot more life left in it.
KING WORLD NEWS NOTE: Silver Radically Undervalued vs US National Debt Ratio Compared To 1980 High
Finally, we measure gold against the Dow Jones Industrial Average, which I find to be a particularly useful yardstick. There is a well-established principle that equities and precious metals move in opposing long-term cycles, where one outperforms the other as large amounts of capital rotate between them. When major secular bull markets in stocks come to an end, such as in the early 1970s or early 2000s, a significant amount of capital typically flows out of equities and into precious metals, and I believe we are about to see that dynamic play out again, which will send gold and silver’s current bull market into overdrive.
During the secular bull market of the 1970s, silver measured against the Dow rose by 3,745% over 98 months. In the 2000s secular bull market, it increased by 900% over 113 months. In comparison, the current secular silver bull market is up only 98% over just 37 months, which indicates that, by historical standards, it has barely even begun.
KING WORLD NEWS NOTE: Silver Radically Undervalued vs Dow Compared To 1980 High
Now that we’ve looked at the various yardsticks in chart form, I’ve compiled all the data on silver’s performance in past and current secular bull markets into this helpful table to show how the current one compares. As you can see, by every metric, the secular bull market that began in September 2022 still pales in comparison to the previous two. This is a clear indication that it has many more years and gains ahead.
For example, if silver were to match the performance of its 1970s bull market, it would reach a peak of $664 per ounce. If it were to replicate the performance of the 2000s bull market instead, it would peak at $219 per ounce. In both cases, these targets are significantly higher than the current price of $53.40 per ounce.
KING WORLD NEWS NOTE: Silver Price Will Reach $664 If It Repeats 1970s Bull Market
King World News note: This is just a small portion of the latest piece from Jesse Colombo’s fantastic work featured on his substack illustrating how radically undervalued the price of silver is vs the high set in 1980.
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