Was that the Gold Silver Price Bottom?

I entitled this week's update as a reminder to any of you out there, the exact numbers, path, and timeline of this price crash and its bottoms, only omniscience knows. It's kind of like, when is the Trump administration and Iran going to come to terms on a peace deal? We have points, major points of agreement. They want to make a deal. And we are very willing to make a deal. I think we're going to end it. I can't tell you for sure when they want to make a deal so badly. You have no idea how badly they want to make a deal. They want to make a deal so badly. I do see a deal in Iran. We were very close to a deal. I think it's close to over, yeah. I mean, I view it as very close to over. It's looking very good that we're going to make a deal with Iran, that it's going to be a good deal. This process should go very quickly. We're going to end that war very quickly. They want to make a deal so badly. We think we're close to a deal, and that's okay. We're in the final throes of what will be a very, very good deal. Perhaps we'll only know once we've fully seen it in the rearview mirror. Meanwhile, nominally ramping US stock market perhaps cynically for rounds of corporate insider IPO bag dumping on the retail. Well, since 2006, the largest 20 IPOs by market cap saw drawdowns of an average of negative 61% only one year after the IPO. Ignoring the silly hyperbolic language of bot articles saying things like silver surged over 67 an ounce, this week we got nearly the 40th promise of an Iranian peace deal with another rising government inflation print of 4.2%. Anyone trying to stay cool and or actually transport anything in the real world knows this is an insult given recent experiences. Almost $300 billion in federal government overspending for last month, May 2026 alone. The feds are well on their way to another over $2 trillion budget deficit this fiscal year, 2026. Happy coming birthday, USA. I'm not even going to mention the unfunded liabilities, multiples larger than these ballooning debts to come. Interest on our debt is already at or near military spending, which is hard to deduce given new wars we've engaged in. Foreign US bondholders continue selling our debt on net thanks to increases in energy prices the world over. That looks like about $150 billion or so sold off since this war started. Perhaps some of that ended up on the Fiat Federal Reserve's balance sheet, which has gone from light QT to now expansion again since the start of the year. Heads up next week, Thursday, for new Fed head Kevin Warsh's policy talking points. It seems both US banks and stablecoins will have to pick up shrinking foreign US debt buyers. The good news for now remains that internationally the Fiat US dollar is still dominant, and it can increasingly afford us more bullion ounces than it did before earlier this year. Later this decade and the next, I doubt I'm going to be able to say that or make either claim. Fiat currency creation around the world from December 2025 through the end of April 2026, that's a five-month time span, that ramped up over $7 trillion according to recent data. If we annualize that growth, we're talking low double-digit percentage growth with what people mostly misnamed money long ago. If we stopped creating Fiat currency, and you know we're not going to do that anytime soon, the price of the world's physical gold pile still needs to double just to reach the old 40% coverage levels hit in the early 1980s. And yes, this Fiat M3 pile will undoubtedly grow more, along with myriad stablecoin government debt financing schemes a-coming. Here was Ronny Stoffeli of the In Gold We Trust report talking about likely road ahead for gold through the end of this decade. Have a listen. If we want to draw an analogy, I think the best is if we compare it to climbing a mountain, climbing Mount Everest, which is almost 8,900 meters high, which is almost exactly our long-term price target. I mean, you cannot just run up the Everest. At some point, you have to stop, go to the base camp, rest there for a couple of days, get used to the altitude, get used to the thin air, and then you can continue climbing. And I think people tend to forget gold had a return of more than 60% in dollar terms last year. I mean, for a pretty big asset class like gold, that's a huge return. And I think now we really have to digest this move. We're sitting now in some sort of a base camp. Of course, bull markets are more fun than bear markets. But I think we're already seeing pretty negative sentiment. We're seeing, when it comes to the mining stocks, we're seeing almost some panic. But the bottom is a process. So I think lots of damage has been done technically. And I think the market usually wants to see the round number. So I think that we will test the 4000 US dollars. But I think you really want to be an aggressive buyer at those levels. You'll probably have seen this chart before, I'm sure I've shown it here, illustrating on a relative basis how much larger gold ETF holdings were in the 2011 bull market top versus where they've been since. Even unsecured gold proxies are hardly owned relative to other ETF bubble asset piles. This chart made the rounds this week, highlighting that last few years of large unsecured gold ETF net buying from 2300 ounce gold onward was more than one third done by Asian investors, mainly in China. Now, this bullion bull doesn't end, in my opinion, until Western investors also too go angle deep into precious metals allocations at large. Most Western investors still have next to none, and much less any clue that 110 million ounces of supposed gold held in ETFs worldwide is only like 1.5% of all the gold we've ever mined. They are a sentiment indicator, unlike silver ETF flows, which can literally throw that market into price ramps and declines, as we've recently seen over the last year or so. I'm finishing this first half with famed Indian gold research analysts at Yardini Research. As you can see on this chart, gold blew outside their red forecast lines to start this year, and now we're getting an opportunity to buy on the other side of those climbing red pattern. More on gold silver related price action charts ahead, plus some recent thought leader insights from even Mr. 60 2020 gold portfolio allocation bullion bull himself. We're going to be right back. Hello, this is James Anderson on behalf of SD Bullion. Smash the like button if you enjoy these bullion market updates, and be sure to visit sdbullion.com forward slash sweepstakes to enter our free silver monster box giveaway. New to buying gold or silver? SD Bullion makes it simple with no order minimums, clear pricing and discreet shipping. Trusted by hundreds of thousands. sdbullion.com where America buys physical gold and silver. Precious metals market sold off and then rallied back on peace from renews. The spot silver price slightly closed up at $68.02 an ounce bid. The spot gold silver price fell to close the week at $4,219 an ounce bid. The spot gold silver ratio fell lower to close the week at $62 on silver's relative strength versus gold. As you likely know, world silver production from miners has been stagnant for the last near decade running, and the world is increasingly relying on secondary recycled silver supplies to make ends meet. A major problem for large silver miners using sulfur and, for instance, zinc refining, is the exploding cost of sulfur if you can secure supplies. Over 1 in 8 ounces of world yearly mined silver comes from Chinese zinc refining, which requires heavy loads of sulfur they banned from exporting last month. We are seeing many reports from some of the largest silver miners in the world that their outputs are not keeping up with their last few years, and I'm not talking about just China, but the largest mining silver market in the world, Mexico. The gold price is now well below its ongoing 200-day moving average, now near $4,450 an ounce. In bullion bull markets, this is buying season. 200 days ago, the price of gold was just below $4,100 an ounce, and thus, in the coming months, the 200-day moving average will keep rising given gold's Q1 2026 move. The point is, gold is now on sale, and it's below the 200-day moving average. 200 days ago, silver was still priced near its seemingly ancient resistance of $0.50 an ounce. Think about that. The current 200-day moving average is near $0.68 an ounce, but that average is also going to be rising into the $0.70s an ounce and probably higher given silver's spectacular move last December and January. So yes, silver, at and below its 200-day moving average, is also now available for you bullion bulls. Moving on to hear from David McIlvenny, whose coming takes are much in line with what we have covered thus far this week. Okay, gold had that surge. There was talk by the end of this year, I think they were saying $5,000, some people were saying $7,000, and now it seems like it's stalled. What's gone on since the start of the year when it came in on such a high? Well, I mean, for a little bit of perspective, we had central banks who've supported the price for a number of years now, and we began to see investor interest widen the base, and by the middle of last year, sort of the third quarter and fourth quarter of 2025, investors were certainly very interested. Their interest was peaked, and they came in, frankly, a little bit late as the rate of change was increasing and to an unsustainable level. Gold did well, silver did even better, and the hot money crowd kind of got their hands slapped by the end of January. Seen a normal correction since then, roughly a 50% Fibonacci retracement of that $2,800 move, and I think that between now and the end of the year, we see recovery and putting in of new highs. And what gives you the confidence with that? Central banks are still the buyer of first resort, and I think you may see investors as the buyer of last resort, and I say last resort because investors typically don't look at gold unless there's concern. What we saw late 2025 and early 2026 was really a momentum crowd, combination of late-to-the-party investors and hedge funds. They were in and they were out. I think they will be back, but the more common characteristic in a gold bull market is for people to buy because they want to preserve value. They see something wrong in the world and see gold as a safe haven. It was not being bought as a safe haven. It was being bought as a pure momentum trade by the end of last year, and so I think it's more normal characteristics will show themselves as we get later into this year. We certainly have concerns about valuations in the equity markets as well as sort of the sustainability of the AI narrative as actual productivity gains are called into question as well as things as simple as what is the rate of return on investment capital in the AI infrastructure build out. All right. I just want to ask, just go back for a second to gold. Usually, it's a safe haven perceived with what unfolded in the Middle East with the war. It didn't really, it didn't turn into that. So what's happening now that we may, this may, another potential peace deal, hopefully this one is the one. And if we see oil dropping and calm centering in the Middle East, what happens with gold then, do you think? Yeah, I think there was a misconception in the trading circles that have pushed gold around quite a bit here of late, and it is that oil up equals inflation up equals interest rates up equals gold down. And in this particular scenario, very unlike the 1970s, if you look back to the 1970s, we had interest rates up and gold up at the same time. I'm not sure the system can take higher interest rates to any real degree with the amount of debt that is on treasury balance sheets these days. Japan, a north of 200% debt to GDP, depending on how you measure it here in the U.S., somewhere between 105 and 122% debt to GDP. Interest on the national debt now exceeds our defense expenditure. Not a great place to be. Frankly, we just can't afford higher rates. So this notion that higher interest rates are somehow going to be a drag on gold, first of all, it forgets the Summers-Barsky thesis that you need to have higher real rates, so inflation has to be tamed, and that has yet to occur. But beyond that, I think in this round, very different than the 1970s, we can't take interest rates higher. It would be game over for the U.S. bond market. We would have our own version of the Liz Trust moment, not because of a policy choice relating to public spending, but because the interest expense is too great. We're already north of 20% of total tax revenue going just to pay the interest meter, and a marginal adjustment higher for our average interest cost, which currently sits about 3.37% would be catastrophic for the treasury. So there's not a lot that they can do in terms of raising interest rates. I think this is a very interesting setup for gold, both as we see investors clamor for safe havens. Obviously, that's theoretical and future tense, but very much so the central banks continue to buy. So I think central banks are still the drivers, but there'll be plenty of catalysts as the year progresses. Again, valuations are in the range of ridiculous. If you look at these in terms of standard deviations, we're between 2.5 and 3 standard deviations. That accounts for 99.7% of all time. In other words, this is one of the most expensive markets we've ever had, and it's difficult to argue from a historical basis that paying high prices is a great way of lining up future positive returns. So I think you're dealing with some investor expectations, which are a little bit over the edge of their skis. And so what are you doing with that, with the concerns about the overvaluation and AI? Yeah, I mean, our recommendation is that people trim back their equity positions. And as enthusiastic as that is, infrastructure buildouts tend to get ahead of themselves. There's such a powerful narrative, and in this case, a flat-out arms race. Who will lead and who will win in this arms race? And not a lot of penciling out of how this is going to pay for itself. Sort that out at some future point. We've seen that in the past. It hasn't played out well, both in the tech and telecom era. I'm going to go back even further to the rail era. We were building too much. Now, ultimately, the thesis was correct. So I'm not anti-AI. I think it is as revolutionary as people believe. But someone else will win significantly. In the era of rails, I'm pretty sure it was JPMorgan who stepped in and bought those assets for pennies on the dollar after they dealt with collapse in the debt and equity. And that, to me, Roger, I think is a telling issue. We now have a clock started. As soon as you introduce debt into an investment equation, this really does have to pay off sooner rather than later. And it's not clear that that's how the egos that are involved in the AI buildout are thinking. It'll pay off someday. And we just have to be at the very lead edge of victory. Finally, we're going to turn to Mr. 602020, Gold Portfolio Allocation Shotcaller, Mr. Mike Wilson, CIO of Morgan Stanley. He was interviewed this week from Bloomberg. A couple of interesting excerpts that we're going to listen to. He spoke about hot capital flows injecting unsustainable moves from commodity to commodity sector. And he explicitly cites a few things about gold and silver. Have a listen. By the way, that goes to the heart of my main question. Watching this throughout the last months and years, right, because spreads have been so tight and equity indexes keep running up. Investors have enough money to pile it into gold and things like Bitcoin. Where is all this cash coming from? Well, don't forget, the bond market's been in a bear market for four years, OK? So what we're seeing is people are not reinvesting their bond proceeds, right? They mature and they're putting into things that can actually protect them against inflation, something we haven't talked about yet. Like the average asset owner is pretty smart. They figured out that, hey, the biggest risk going forward is inflation, which is kind of my thought. Then I want to own assets that will protect me against inflation. That's not bonds, OK? That's equities. It's gold. It's silver. It's other real assets. And that's what they're doing. So there's a tectonic shift, OK, from the 60-40 to something that looks more like 60-20-20 or even 70-30, depending on your preference. But the rate of change matters. In the short term, it matters. And that's what's going on right now. To me, that's