SD Friday Wrap: Good news. No, make that GREAT NEWS! The tide has turned for gold & silver. What’s the proof? Grab your surfboard and come find out…
Make that great news!
There is great news to report!
Imagine that, huh?
‘Ol Half Dollar isn’t the doom-n-gloomer he’s made out to be.
He is really an optimist with great news to report!
Starting out, check this out:
OK, “Hey Half Dollar, you said you had good news, so why are we looking at a poll with Bitcoin beating gold?”.
Bitcoin is not beating gold, and that’s the good news.
It’s great news, but you have to hear me out to understand how and why Bitcoin is not beating gold.
To hear me out, we need another visualization, which is the result of a simple Google search with the phrase “average age of twitter user”:
It is hard to see on the chart at the right, but the very first bar on the left shows 17.7% of Twitter users are 18 – 24 years old, the second to the left bar shows 22.5% of Twitter users are in the 25 – 34 age group, and the third bar from the left shows that 19.5% of Twitter users are between the ages of 35 – 44.
What does that tell us?
Nearly 60% of all Twitter users are under the age of 44. The largest demographic for Twitter is the generation of the Millennials, and there is a significant percentage of Twitter users between the ages of 18 to 24.
What does that have to do with Ron Paul’s survey?
A lot, actually.
Now, I’m no mathematician, and much less a statistician, but it doesn’t take either to realize that the majority of those votes cast would have been cast by people aged 44 years and below, and yet Bitcoin only got 51% of the vote.
You see where I’m going with this?
The tide is turning my friends, fellow stackers, and yes, we’ll even let the trolls know too.
The tide is turning.
The results of Ron Paul’s poll are skewed and inaccurate in the sense that the results do not reflect reality.
Again, since I’m no statistician, I can’t do a great job of explaining it in the mathematical abstract, so let me throw-up, figuratively, another visualization, this time from business insider:
Let’s see what we can glean off of that chart (in no particular order):
- It is a chart of the financial “peak at everything”, yet the creators don’t even count people under age 25 for anything, and that age group makes up 17.7% of Twitter users
- People aged 25 spend more money they don’t have (i.e. credit cards, student loans, or their parents money) than money they do have
- Men don’t make the most “money” in their careers until age 49
- The highest net worth that an individual will achieve doesn’t happen until at least age 65
Putting this all together in light of Ron Paul’s poll, what does this all mean?
In a nutshell, it mean that investors are finally starting to realize the importance and significance of owning gold.
By extension, we can say it means that investors are finally starting to realize the importance and significance of owning silver too.
More importantly, investors are willing to act on that realization.
Let’s think about all of this in another way.
Now, I don’t know who said this, but it is valid, it is important, and in my opinion, the following is true.
In no particular order of importance, somebody once said that Bitcoin is great for people who:
- Don’t understand history
- Don’t understand math
- Don’t understand money
Now I’d like you to think for a moment about “No Child Left Behind” and “the dumbing down of America”.
Take as much time as you need to think about those things.
After you have thought about those two things, I would ask, is it possible that the majority of the people who voted in Ron Paul’s poll don’t understand history, math, or money?
Heck yes it is!
On top of that, I’d like you to think about the fanaticism otherwise known as the Cult of Bitcoin.
Geez, those Bitcoin Fanboys.
I mean, it’s not really debatable – they’re fanatics.
Since the younger generations represent the largest percentage of users on Twitter, specifically the Millennials, it is, in my opinion, highly likely that these same social media oriented, Bitcoin fanatical Millennials, who don’t have any money of their own, or if they do have any money, they don’t understand history, math or money, yet they ganged-up together to intentionally skew the results of Ron Paul’s poll in favor of Bitcoin.
But, surely I’m just seeing things, right? I’m trying to see something that’s not there, aren’t I?
No and no.
Check out the same exact poll from the same exact person taken last December 5th, 2017:
OK, “Hey Half Dollar, the results look about the same to me!”.
They do look similar, but they are miles apart.
The percentage of people voting for gold increased from last year to now, and the percentage of people voting for Bitcoin decreased from last year to now.
But that’s not all.
What has happened to the prices of Bitcoin and gold since last year?
Bitcoin was above $11,600 on December 5th, 2017:
Additionally, Bitcoin was rising in price prior to the 5th, and Bitcoin was above $17,000 only three days later, on the 8th of December.
Gold closed the day on December 5th, 2017, at $1268:
Additionally, gold was falling in price for days prior to December 5th, and gold kept falling in price for days after December 5th.
Said differently, the sentiment was bullish towards Bitcoin on December 5th while there was bearish sentiment towards gold on the same day.
What are the prices of Bitcoin and gold right now, and what are those prices in relation to last December the 5th?
- Bitcoin is about $5,500 right now, down more than 52%
- Gold is about $1220 right now, down some 3.7%
Now, what does last year’s poll have to do with this year’s poll?
The price of Bitcoin has crashed more than 52% in less than a year, yet the Cult of Bitcoin is so strong, that even after a 52% crash, the young, that is, mainly, the broke Millennials who don’t understand history, math, or money, still prefer Bitcoin over gold. Additionally, taking both polls into consideration at face value, the Cult of Bitcoin obviously hasn’t even capitulated yet. This lack of capitulation is evident because the results from the two polls, at face value, are similar.
On top of that, the price of gold is only down some 3.7% since last December the 5th, and there is a larger percentage of people who voted for gold this time around than they did last year.
Now I get it: I’m mumbling through the points that I’m trying to make, but these points are important, so please re-read my mumblings, as painful as they may be to read.
Furthermore, I need to add yet another point on top of the points that I have already made.
This is the most important point I will make, because it gets at the essence of why that first poll at the very top of the page is great news.
Specifically, if Bitcoin stole some of gold’s (and silver’s) luster last year, the collective psyche is now turning back to favor gold (and silver).
Said another way: People who are into Bitcoin are now leaving Bitcoin, and they are turning to, or returning to, gold & silver.
I don’t know how to explain it any better than with the pathetic mumbling I have already mumbled. Maybe I can’t explain it any better because the picture is only now coming into focus, and I am only now starting to be able to see and connect these dots?
I mean, that latest poll from Ron Paul was just started yesterday, and technically, the poll is not even over yet.
And I’m sure nobody else has connected these dots either.
Bottom line: The tide has turned.
Investors are moving towards gold & silver.
And that’s good news.
Make that great news.
I get a bad rap.
I get it.
When you fight for honest money, you are bound to get that. Money is, after all, the most basic and fundamental tool we all have and we all use each and every day.
I also get a bad rap for my calls.
I don’t get that.
I’ve been spot on with the vast majority of my calls, and I admit when I’m wrong.
That said, what have I said about crude oil and the silver price? Screaming it from the rooftops for months on end? I said if crude oil falls into the mid-$50s, then get ready for lower silver prices.
Is it any coincidence then, that as crude oil traded down to a 55-handle, silver hit a fresh 52-week low?
The silver chart looks exactly as I said it would:
Have we seen the low?
I think so, but I wouldn’t put it past the cartel to smash price below the December 2015 lows, you know, just to spite us.
I don’t think they will, however, because they know that after three years of additional money printing, if they really smash to $13.50, then physical silver is going to vanish from the market. So they may smash, say one Sunday, at 3:00 a.m., when the West is dreaming of sugar plums, and the cartel smashes silver, and the price drops to $13.50, but the price only stays there for minutes, maybe even for seconds, and then the silver price immediately recovers.
If we do go lower from here, I don’t think we’ll stay much lower for long. I made two purchases this week. I got the price I was looking for two weeks ago. If price drops below $14 again, I’m going to keep on adding to my very humble stack. And yes, I’ll be dollar cost averaging on the way up as well with regular, monthly purchases.
You see, that is the box in which the cartel finds itself. Us stackers are smarter than we have ever been, and we have caught on to the cartel’s smash cycles, the cartel’s lower-bounds, and we have caught on to the cartel’s games.
So go ahead cartel.
We dare you.
Triple. Dog. Dare.
Sorry for the festive mood. I’m feelin’ pretty good about gold & silver right now, and it is, after all, the holidays.
Gold briefly lost $1200 not one but twice this week:
Gold did not, however, put in a new 52-week low.
Check out palladium:
People have been doubting the physical supply shortage in palladium, but that chart says it all.
Are we close to or at shortages with gold or silver?
We don’t know.
Well, I don’t know.
It is highly probable that the number of people who know the real physical supply of gold & silver can be counted on one hand, even the hand of some guy who lost a finger in the war. It is also highly probable that the actual above ground inventories of physical gold and physical silver are a more closely guarded secret than the recipe for Coca-Cola. Finally, and I’m not kidding when I say this, but the actual supply of physical silver may be a more closely guarded secret than perhaps even nuclear ICBM launch codes.
Platinum bounced nicely off of its 50-day moving average:
If the bounce holds that is a beautifully painted higher-low.
After plunging into a bear market on Tuesday, crude oil has bounced and is up for three days in a row:
Is the low for crude oil in?
That’s the question everybody wants to know, and likely, everybody wants to know what is going on with crude oil more than they want to know what’s going on with their favorite investments.
OK, “Hey Half Dollar, you said crude oil was going to $80 by years end. You were wrong!”.
Thanks for rubbing that in my face.
The year’s not over yet, but yeah, it looks like crude won’t make it there.
That said, I have a new working theory for crude oil. My working theory is that the dollar is going to begin to fall, and since the dollar is going to begin to fall, the price of crude oil is going to begin to rise. Since the dollar is about to fall and crude oil is about to rise, the cartel wants the price of crude oil as low as possible before that happens.
Because a falling dollar and a rising price of crude oil are a double whammy.
Copper looks like it could run here:
And I think copper will run higher.
For these main reasons (in no particular order):
- The price has already crashed this year
- Inflation in general in conjunction with a weaker dollar
- So the cartel can bring silver to market (as a bi-product of copper mining).
- Copper will be needed for the infamous Trump “infrastructure spend” (which may never come)
- Copper will be needed to fiscally stimulate a collapsing economy (assuming there was no “infrastructure spend”)
To all the people hoping the stock market is going to rally into the end of the year, I have bad news.
Behold the death cross on the Russell 2000:
That doesn’t look good.
The VIX has a golden cross which isn’t helping the stock market either:
If there is no Santa Rally, but instead, 4th quarter stock market crash, then we’ve got more volatility ahead of us, not behind us.
Yield on the 10-Year Note is now under 3.1%:
Which can only mean one thing: These markets are hyper-sensitive right now.
But why wouldn’t they be?
Governments and central banks around the world have screwed things up so much that the markets can’t even handle the slightest increase in interest rates.
Pop Quiz: Where is the gold to silver ratio right now:
The question is a gimme anyway.
The gold to silver ratio is right where we all have come to expect it:
Expecting the gold to silver ratio to stay there, however, is a mistake.
Ending with the all-mighty US Dollar:
I don’t see strength there.
And I don’t like the “cleanest dirty shirt” analogy either.
I like to think of the dollar as those pathetic guys who get silicone implants, much like women who get breast implants, but the guys get the fakery to give everybody the illusion of muscle.
Why do I like that analogy better?
Because the people dirty the shirt.
But it’s not the people who have ruined the dollar, or all of the other debt-based fiat currencies for that matter.
The surgeon is the one who has ruined the dollar.
And the surgeon’s name is Dr. Fed.
In one of these surgeries, Dr. Fed will kill the patient.
And it won’t be an accident.
– Half Dollar
About the Author
U.S. Army Iraq War Combat Veteran Paul “Half Dollar” Eberhart has an AS in Information Systems and Security from Western Technical College and a BA in Spanish from The University of North Carolina at Chapel Hill. Paul dived into gold & silver in 2009 as a natural progression from the prepper community. He is self-studied in the field of economics, an active amateur trader, and a Silver Bug at heart.