Maria’s Note: Maria Bonaventura here, Rogue Economics’ senior managing editor. I’m thrilled to welcome our new editor, Nomi Prins. Nomi is a best-selling author and financial journalist. But once, she was a Wall Street insider…
Nomi worked as a managing director at Goldman Sachs… ran the international analytics group as a senior managing director at Bear Stearns in London… and was a strategist at Lehman Brothers and an analyst at the Chase Manhattan Bank.
Over the next few weeks, Nomi will show you why she left her career as a global investment banker… and set out to demystify the world of money.
And, going forward, you’ll hear from Nomi and her team every day in these pages. They’ll shed light on the ways the elite few manipulate the financial system to serve their own interests, at the expense of everyone else.
And they’ll put you on the right side of a disconnect Nomi sees between the economy and the markets. Read on for today’s insight from Inside Wall Street contributing editor, Lau Vegys…
Silver, the poor man’s gold.
It is often overlooked by investors, even during commodities rallies.
In fact, when most people think of this unique metal, they don’t think of it as an investment.
They think of their grandmother’s precious cutlery set that’s only taken out for special occasions.
In today’s essay, I’ll explain why silver is much more than a shiny family heirloom. In fact, it is essential for the future economy… and your investments.
Let me show you what I mean…
New Energy Is a Big Win for Silver
I’ve been writing financial newsletters for 12 years. During that time, I’ve covered metals and mining extensively.
I’ve visited explorers and producers at the far corners of the globe. And I’ve delivered high returns to our subscribers on various commodity investment recommendations.
Silver has always occupied a special place in my heart. And I can tell you there are many reasons to like silver right now.
Silver is both a precious and an industrial metal. It’s used in nearly every major industry – from biocides and electronics to solar panels and batteries.
You’re unlikely to go even one day without using a product made with silver, even if you don’t see it.
But here’s why I’m most excited about silver today…
Silver plays a vital role in the global shift towards New Energy sources.
New Energy (or alternative energy) means any energy source other than fossil fuels. And it’s at the core of the green energy megatrend sweeping the globe right now.
Now, silver may not seem like an “energy metal.” But its properties make it a winner in the green energy megatrend in two crucial ways.
It’s a better electrical conductor than copper. And it has the highest thermal conductivity of all metals.
That’s why silver is a critical ingredient in most solar panels and vehicles. And the amount of silver needed to bring about the “New Energy” world will only increase in the coming years.
Look no further than California, for instance. It recently mandated that all new residential homes be equipped with solar electricity systems.
This is a big win for silver.
The Silver Institute estimates that about 110 million ounces of silver went into solar panels this year. That’s a 13% increase over 2020.
And as more states follow California’s lead, that will mean a huge spike in demand for silver in the solar energy field.
Another Big Driver of Silver Demand
But solar power is not the only reason silver will get a big boost in the years ahead. Silver’s use in automobiles is also on the rise.
It’s no secret that most major economies worldwide have been working hard to get away from internal combustion engines (ICEs) and complete the shift to electric vehicles (EVs).
Most experts agree that all-electric autonomous vehicles will rule the road in the not-too-distant future. This, too, bodes well for silver. That’s because it takes more silver to make an EV than your traditional gas hog needs.
Each EV battery is made from about 25–50 grams of silver, while an ICE vehicle needs about 15–28 grams.
The Silver Institute puts automotive demand for silver at 64–65 million ounces in 2021, growing to about 80 million ounces by 2025.
Disconnect Between Potential and Price
The best part is: Silver is still a bargain.
It’s trading well below its March 2011 high of $46 an ounce. And it declined roughly 18% in 2021.
Yet, silver’s demand is poised to surpass 1 billion ounces in 2021, for the first time since 2015. That’s an increase of 15% over 2020.
All this tells us one thing: There’s a disconnect between this metal’s potential and its price.
That’s a sign of a bigger disconnect our editor, Nomi Prins, has identified between the financial markets and the real economy.
It’s the greatest discovery of Nomi’s career. And it could create the biggest wealth-building opportunities of your lifetime – if you know how to play it.
And silver is a perfect example. It’s hard to find a more distorted market right now. Investors are ignoring silver, despite the huge growth potential we outlined above.
How to Play This Market Disconnect
So how do you take advantage of this opportunity?
One of the simplest ways is to buy physical silver.
You could start with buying the most popular silver bullion coins. These include American Eagles, Canadian Maple Leafs, and Austrian Philharmonics.
Just keep in mind, coins are typically priced at a premium to the silver spot price.
To avoid high premiums, silver bars are another great option. They have lower premiums than coins.
The next few years could be huge for silver. Now is the time to add some exposure to this unloved metal to your portfolio. So look out for more from me on ways to do this in future dispatches.
Contributing Editor, Inside Wall Street with Nomi Prins
Maria’s Note: Stay tuned for more from Nomi and her team over the next few days. They’ll show you ways to take advantage of the trends that will shape 2022. Tomorrow, you’ll hear from Eoin Treacy. Eoin has been a gold and natural resources investor and trader for nearly 20 years. He’s recognized worldwide for his knowledge of asset classes, sectors, and thematic investing. Look for Eoin’s essay on the opportunity in a beaten-down part of the energy sector in your inbox at 12:30 p.m. ET tomorrow.
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