Over the last 100 years, the major peaks and troughs of the silver/gold ratio have marked HISTORIC turnings in the markets. 
As the ratio surges through 80 to 1, is the gold / silver ratio trying to send us a MAJOR WARNING?

 

 

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Submitted by AGXIIK:

February 2016 is how 80 to 1 and rising steadily Is this an indicator of worsen times, more economic stress and banking problems. Correlation and causation are at work here.
I’ll leave readers to decide for themselves.
The peaks of this critical ratio are the peaks of economic stress.

 

Major GTSR Peaks and Troughs:

Sept 1931: 78 The Depression bites hard–gold is a monitor of fear
July 1940: 97 Winds of War are blowing hard
May 1968: 16 Lots of war(over there), DOW is high, inflation is low PMs are kicked to curb
April 1972: 31 Watergate, War is going badly, higher inflation and taxes, wage and price controls
June 1973: 45 Losing war, recession, DOW crash post gold standard, inflation and joblessness high
Jan 1975: 42 DOW at low, inflation and unemployment hit 10%
Jan 1976: 26 Pivotal presidential election year—hopes for revival are high.
Dec 1979: 14 The gold and silver rush in on, silver skyrockets in price Thank you Bunkie!
Mar 1980: 41 Gold and silver are near their peak in price
June 1983: 36 Interest and tax rates are down, economy starts to pick up.
Oct 1986: 76 Economic and banking headwinds, Russian and currency crises abound
Jan 1991: 100 Start of major banking crisis, housing crash, 1000 banks were closed
Sept 1991: 92 Continuation of bank and housing crash
June 2003: 79 Culmination of tech wreck
Nov 2006: 49 Low GTSR, a couple of months before the 2007-09 housing and market crash
Nov 2008: 81 One month after Lehman crash
April 2011: 32 Two months after the gold/silver price peak and price crash–an outlier event
Feb 2016: 80 Let the good times roll—NOT

Note that the swings have become more radical and violent in the last 40 years

The systemic stresses grow daily as the gold to silver ratio climbs.

The chances are much better that gold will go up significantly in price before silver.  Silver is a lagging indicator.

I surmise gold goes up first because it is a metal that means something to the central banks, central governments and wealthy individuals.

Silver is poor man’s gold and when the vast majority of people realize they are behind the curve and must acquire precious metals, they go to silver.

While silver is more of a commodity metal at present prices, imagine its value when its price builds to the point at the GTSR is 20 to 1 and gold is $2,000.
This is food for thought. And food for those who see this ratio as an indicator of weakness in the overall markets.

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    • Pretty cool that with a week to go in February the US Mint is just a tick away from selling 10 Million ASE here in 2016.

      So does anyone REALLY think the Silver is there to continue sales at a 5 Million unit per month pace?
      I sure don’t.
      So well see…. I’m still 100% convinced that Physical –availability– is going to be the Story….And the action will be right there for all to see as the “Allocations” from the Government Mints will exhaust…Expecting word to filter out that production is slowing/stopping as soon as next week.
      I still fully expect supply problems for investors trying to add Phyzz Silver going forward beginning here at the end of Feb…and fully expect Mint allocations to begin biting stackers hard— in March with a dramatic rise in premiums….so much so, that by 4th of July spot and premiums will be equal and by Labor Day premium will exceed the spot price on Mint items…..and ‘Numismatic Value’ will shock buyers on Maples and ASE’s…even only 4 or 5 years old. Stackers are going to see with their own eyes–Hold in their own hands Silver and think to themselves…. Spot, + Premium + a Numismatic Value  added up together…… making it tough to hold their water!

    • Hey 4oz Old Friend!

      I agree with what you are saying, but for one thing:

      Numis lose their premium as compared to Bullion, in a big Bull Market upleg.

      They say that millions of numismatic coins were melted when Silver peaked at $50

      in the late 79 to early 80 run up… The bullion value exceeded the numismatic value.

      Hard to believe, but it went uo so quickly people said “screw it”

      If the markets had time to stabilize at high levels, the numis might have regained

      some of their “extra premium” over the bullion coins.  JMHO, but

      I believe history bears it out also.

      I also think our old Uncle AGX is on to something, here  😉

  1. Yes, the signal is…………

    Au can be 2000 per oz. while at the same time Ag can be 20 per oz.

    Historical ratio’s / facts mean zilch. Billionaires own Au, not Ag.

    Its harder to tamp down Au while Ag is the thinnest of markets and can be controlled with much ease.

    Au is 98% money/store of value.

    Ag is 30% money and 70% industrial use.

    Period!

     

    • I just bought some electronics solder.   The good stuff.   It’s 4% silver and the rest is a mix of tin and lead.   It’s used in high-tech electronics circuits – and it’s pretty cheap right now.   But you’re right – there are other uses for silver beyond money.

    • So let me get this right, according to Sinclair and holter the real stgr (actual physical out of the ground) is 9 gold to 1 silver. You are saying that 70% of silver is swallowed up for industrial use, so that makes it 3 times rarer as an investable store of wealth. Now extrapolate that to the figures mentioned before and the investable part of silver against the investable part of gold is……….stgr= 3 gold to 1 silver. Not bad!! I’ll stick with silver, period! (Also with extra spit)

    • Let’s not forget the fact this could also indicate that the price of gold is too expensive right now and gold to silver ratio seems to point that gold could go down pretty soon to the normal ratio levels. Silver went down first because people is not attached to it.

    • @ NotAnOwner….. you must be high…. are you kidding me? When inflation is factored in, gold and silver are cheaper than anytime in history….EVER! Time for you to assume a different way of thinking bro… to da moon!

    • Don’t forget that markets tend to react before hand. Could give silver a bit of a push upward towards its real price. Markets react swiftly and often violently. I sense silver is waiting for any excuse to lift off. There seems to be an increased resistance to its downward movement on most days. This is a good thing. Keep your fingers crossed boys !!!!

  2. Gold is the preferred metal for Gov’t and Central Banks, silver not so much.

    80 to 1 ratio is the prevaling market,

    Chinese are buying gold and India buying silver by the ton’s.

    Keep stacking till it hurts and then

    stack some more.

    • Silver was money in China, Mexico and Rome not to mention many other places. Its gold to silver ratio is so skewed BECAUSE silver is a smaller market and easier to manipulate. However when the faith and good will towards the dollar causes gold to go up how on earth could anyone think silver wont go up too? And because it is “cheaper” and has a history of being money, a fact that people will be reminded of, it will be restored to its true value, somewhere around 8 to 15 to one of gold. IMHO.

      And when industrial users plan for the future uses of silver in their products they will hoard it too causing the price to go far beyond those ratios. All the easy silver on the planet has been mined over the last 2000 years or so. Its getting more difficult to find every year.

       

    • @aztecminer

      I feel the same way…I have to force myself to get the Au…deep down though I know it is the prudent thing to do…simply because you can carry some Au in your pocket to bug out fast and what if you have to wait for awhile for the proper ratios….I am willing and prepared to wait…but a little Au could help in the short term…I am very top heavy in in Ag but I do see Au for it’s advantages…I mean heck when Au was a smidgen over $1k/oz you had to be looking at getting some…right?

    • I think you mean US-SKEWED Statistics!

      And since it is in U$D, (wrc) it makes sense, but only for a little while… 

      I just hope that the US crash does not take down major portions of the rest of the world.

      I bet the Euro is toast, but aren’t the folks over there preparing for a Euro-Crash as well, J?

      Ill fated economic “experimentation” and they are looking to supposedly do that here,

      to make the NAU  like the EU? 

      What a fuggin’ abortion…

       

    • I am hoping that the Allocated Bullion Exchange does just that.  What I would like to see is the quotes from the ABX shown on Silver Doctors and other websites, perhaps alongside the quotes from the Futures markets which we have now.  The thing is we have to exercise greater control over the dialog.  By showing ABX quotes I think we begin to change the messaging framework.  Put another way, I want to know what the actual trading price is for spot, not the BS Futures numbers.

  3. I suppose someone has to play devil’s advocate. Ok, so, history proves this and history proves that… and it has happened every time….right until the last time and then it doesn’t happen again.  Buggy whip sales are at an all time low….times have changed.

    Respectfully, how can the gold/silver ratio be sending us a message when there is no price discovery mechanism any longer. I think the entire topic of precious metals needs to switch from speaking of todays “manipulated paper metals prices” on Kitco.com to “hey, what would someone like to sell me a bar of gold for today?” I personally wouldn’t sell mine at any price at the moment!

    Now we would be getting somewhere.

    • The doc lists what price he’ll sell all of the gold and silver merchandise. So there you have it. And whether it’s in Stock or how long the backorder is.

  4. welp,

    once again. to repeat.

    STGR explained

    silver $15.00 an ounce x 15 equals $225.00

    so if silver is 15.00 an ounce and gold is silver times 15 that makes gold $225.00

    so Gold is Really over priced at $1,200.00 an ounce.

    See now You feel better about the silver price, don’t cha?

    Dolph

     

    • Is there any metric more important as a basis for price than COST?
      Cost ratio is around 60:1 now.
      So gold IS being marked up higher or marked down less, than silver. Just not by a lot.

      Cost ratio is most discussed by yours truly, for all of the globe. Most analysts won’t even go there. Yet in free markets without unnatural kapitalization, cost is very important. Now that everyone makes a loss, what’s to keep a new mine from opening on an ore body that costs $20/oz to mine? Everyone else is doing it. Cost is currently not part of price finding, but it should be leading.

  5. I wonder what the ratio would be if the gubmint confiscated the yellow but not the white?

     

    Gold is for billionaires…..maybe, but there are 1000 times more paycheck-aires who can’t even think about gold, who do not want to be left out so even if confiscation never happens, silver will have it’s time in the sun, and I don’t mean in solar panels.

  6. @zigzag [email protected]   I see that and while gold might a decent price now, price discovery problems notwithstanding, silver seems to be underpriced.  The  chart I used went back around 100 year so the 18th and 19th century were not checked. Back then and in centuries past, the ratio ranged from 9 to 16.  Price discovery is making a hash of the price we see but the swings observed 100 years ago were only half as violent as today. Ranging from 78 to 1 in 1931 was a tremendous high but ranges from low to high were not as violent as the last 40 years.  Swings are now more violent and more frequent, emblematic of the worsening monetary swings, crashes and financial problems.  This pendulum swing from high to low in national and world economic situations seems to produce the big swings in the ratio.

    One thing to notice is that once the high is hit, often just before a crash, the ratio drops very quickly to a much lower level as some sort of reset takes place

    Price discovery is pretty fake but within the false price discovery, the swings still show up.  So the ratio changes seem to hold

    High GTSR—more economic crises   The next one is going to be a doozie and the ratio is confirming my assumptions.

    Selling gold and buying silver or just buying silver seem prudent at these levels

    Hi Dolph   good to see you on the boards.

    • I am, of course, being sarcastic.

      Love My silver stack and very jealous of the Gold buggers because I have none. We all pretty much know what is gonna happen to silver.

      Everything gets a turn in the Oligarchs world of commodities wealth. Wood, steel, PM and so on. At least us little folks can buy silver!!

      Our turn is coming. This is un realistic and totally bizarre what is going on in these markets. The Israeli war pigs and their  Federal reserve banking cartels seem like they might be out of tricks? Their cash cow (USA) is broke, busted, spent. Everyone is watching this show with bewilderment, like a slow motion train wreck.

      Stack up folks,

      Nice to have You mention Me AG!

      As always,

      Thanks for the input!

       

    • Hey! (Panting from outrunning zombies in Washington State)

      …Ranger….(catching my breath)… See you survived Rangerocolypse too!….

      (Groaning in the background)

      (Catching my breath) Well! Time to keep moving!  …Be safe man! Good to still see another survivor….

      (Runs off into the wasteland)

      🙂

    • There you go buddy.  You are seeing what I see.  It’s just taken you much longer to get there.  I think you and I would both like to see significantly higher prices and a less corrupt system.  These guys are spitting in our faces over and over again.  It’s f ing insulting to people’s intelligence.  If these guys had any conscience they would just sht up already.  Disgusting.

  7. Just acknowledge that you have no idea where things are headed and move on.  We all know you guys are just grasping at straws.  Just hold onto your stacks and stop paying attention for awhile.  I just don’t understand how people can write thousands of articles about something they don’t understand.

  8. @AGXIIK:

    This precisely why I got out of Silver into Gold.    This time around Gold could go ‘no bid’ because holders of Gold are stronger hands and see Gold as a store of their wealth.

    Silver on the other hand is bought by a lot of weaker hands who could start selling if the price jumps up and they want to cash in.

    I have suddenly become a Gold ‘hold it in your hand’ advocate and I am at this very moment extricating my self from BullionVault and buying Krugerrands on the internet.

    Because of the delay in selling and transferring the money and then buying  it’s quite nerve wracking.

  9. @AGXIIK

    April 2011: 32 Two months after the gold/silver price peak and price crash–an outlier event

    As I remember it, it coincided with silver’s peak, as market regulators opened machine gun fires, shooting margin rate hikes at silver. Gold was left alone to climb until early August. An absolute outlier as both were going seperate ways. had silver been left along as long as gold, the ratio could have reached 20 or so. For $90-100 silver.

    Note that April 1st, the US Dollar index also bottomed. On that day, nothing real happened.

    • They had to hammer Silver, because it reached that “PSYCH NUMBER”

      of $50 an ounce! It was $48.xx in the daytime markets, but it actually BROKE $50

      in the overnight trading session…

  10. “As the ratio surges through 80 to 1, is the gold / silver ratio trying to send us a MAJOR WARNING?”

    In Australia the GOLD ONE OUNCE has a face value of $100

    ”    ”                 SILVER ONE OUNCE has a face value of $1

    Just wondering, is Australia ready for the RESET when we reach 100 to 1. ?

     _JOHNLGALT

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