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Which Country Is the Largest Silver Investor In The World??
Which Country Is the Largest Silver Investor In The World??
Over the past decade, these top five countries were the leading silver investors in the world. From 2010 to 2019, citizens in these countries invested over two billion ounces of silver bars and coins. Which country was the largest investor of silver? Actually, I was surprised by the data.
Since 2010, investors from India, China, United States, Germany, and Canada purchased a tad bit more than two billion ounces of silver bar and coin. To be precise, it was 2,004 million oz. The world’s largest investor of physical silver bullion products turned out to be Americans. U.S. citizens invested in 929 million oz (Moz) of silver bars and coins over the past decade.
Indian investors came in second at 615 Moz, followed by Germany (265 Moz), China (139 Moz), and Canada (56 Moz). While I wasn’t shocked that Americans were the largest physical silver investors, I was quite surprised at the amount purchased by the Chinese and Canadians.
According to the data from the Silver Institute’s 2020 World Silver Survey (by Metals Focus), while the Royal Canadian Mint produced nearly 26 Moz of Official Silver Coins in 2019, it’s citizens only purchased 5 Moz of silver bars and coins last year. Thus, most of the Silver Maple Leafs were bought by Americans or other foreigners.
Furthermore, even though there are over 1.4 billion Chinese, it’s citizens only invested 139 Moz in silver bars and coins from 2010-2019. Chinese tend to favor investing mostly in physical gold bullion. In contrast, India, with a smaller population than China, invested more than four times in physical silver. Moreover, Indians prefer silver bars over coins. The overwhelming majority of the 615 Moz of physical silver purchased by Indians was in bar form… most likely 90+%.
…click on the above link to read the rest of the article…
BREAKING NEWS: Peru Silver Mine Supply Collapsed In April
BREAKING NEWS: Peru Silver Mine Supply Collapsed In April
With the data now finally out, Peru’s silver mine production collapsed in April. Due to the shutdown of a large portion of Peru’s mining industry, as a result of the global contagion, the impact on the world’s second-largest silver supply was enormous. While I had mentioned in previous articles that I expected to see silver production from Mexico and Peru to decline significantly, I’m amazed actually to see the real numbers.
Over the past several months, I have checked the Peru Ministry of Mines website for updates on the domestic mine supply figures. However, they have not updated their monthly production data since December 2019. I tried writing the Peru Ministry of Mines website to find out why they haven’t been updating their figures, but I received no reply.
I decided to do a bit more digging and found a newly released April 2020 Mining Update in response to the global contagion. This new Mining Bulletin published Peru’s mine production data for January to April 2020. According to the recently released data, Peru’s silver mine supply in April fell to 85 metric tons (mt) versus 322 mt during the same month in 2019:
Peru’s silver mine supply collapsed by 74% in just a few months. If we convert to troy ounces, the year-over-year change was a decline from 10.3 million oz (Moz) to 2.7 Moz. Thus, the world’s second-largest silver mine supply fell 7.6 Moz in April. Now, if we look at Peru’s monthly mine supply over the past year, we can see that silver production started to decline in March:
As the Peruvian government started implementing mine closures in the middle of March, silver production fell by nearly 100 metric tons compared to February.
So, if we compare the change in the first four months of 2020 versus the same period last year, here is the result:
…click on the above link to read the rest of the article…
U.S. Total Public Debt Increases a Stunning $25 Billion A Day In 2020
U.S. Total Public Debt Increases a Stunning $25 Billion A Day In 2020
Americans better become reacquainted with Gold and Silver. With the Federal Government adding $25 billion of new debt every day so far this year, at some point, investors are going to lose faith in the U.S. Dollar and U.S. Treasuries. Just think about that for a minute. On average, for every working day this year (116 days so far), the U.S. Public Debt has increased by $25 billion.
In just one week, the additional $125 billion of U.S. Public Debt could have purchased all global silver mine supply for the past eight years, nearly 7,000,000,000 oz. And, in a little less than a month and a half, the increase in U.S. Public Debt would have purchased ALL KNOWN Global Silver Production since 1493… 52,000,000,000+ oz. This is how insane the whole system has become.
According to the data from the St. Louis Federal Reserve and TreasuryDirect.gov, total U.S. Public Debt increased from $23.2 trillion in Q4 2019 to $26.1 trillion as of June 10th (the figure is $26.065 trillion, but I rounded it up to $26.1 trillion).
So, in less than six months, the total U.S. Federal Debt ballooned by nearly $3 trillion. Now, if we go back and take the annual debt increase for each year and divide it by 250 working days, we have the chart below:
From 2007 to 2019, the average debt increase per day was $4.4 billion. Take a look at the average increase of U.S. Public Debt so far in 2020. It sticks out like a sore thumb.. eh? If we divide $2.9 trillion of new debt by 116 working days in 2020, it comes out to a nice EVEN $25 billion PER DAY… LOL.
…click on the above link to read the rest of the article…
BIG TROUBLE FOR THE BIG THREE U.S. OIL COMPANIES: Financial Disaster In Its Domestic Oil & Gas Sector
BIG TROUBLE FOR THE BIG THREE U.S. OIL COMPANIES: Financial Disaster In Its Domestic Oil & Gas Sector
There’s no better way to describe what is taking place in the U.S. Big three Oil Companies domestic oil and gas sector than a complete and utter financial disaster. Honestly, I am not exaggerating. The only place ExxonMobil, Chevron, and ConocoPhillips are making decent money is in their non-U.S. or International oil and gas sector.
While it’s no secret that the U.S. shale oil industry continues to be a trainwreck, the damage is now spreading deep into the financial bowels of the Big Three Oil Majors. Unfortunately, the largest, ExxonMobil, has the worst-performing domestic oil and gas sector in the group. So, it’s no surprise that ExxonMobil was forced to borrow money just to pay dividends. I posted this chart in my last article on ExxonMobil:
As you can see, ExxonMobil’s long-term debt over the four-quarters (Q2-2019 to Q1 2020) increased nearly the same amount as the shortfall between the dividend payouts and the free cash flow.
However, if we look at the Big Three as a group, Q1 2020 wasn’t pretty at all. The next chart combines ExxonMobil, Chevron, and ConocoPhillips Upstream Earnings and Capital Expenditures (CAPEX) from their U.S. sector versus their non-U.S. or International sector. The upstream sector refers to the company’s oil and gas wells.
The Big Three suffered a net $900 million earnings loss from their U.S. upstream sector while spending a whopping $5.6 billion ($5,591 million) in CAPEX. Now compare that to the combined non-U.S. or International upstream earnings of $4.3 billion based on investing $4.6 billion in CAPEX.
…click on the above link to read the rest of the article…
U.S. MINT GOLD COIN SALES ALREADY DOUBLE vs. 2019: Best BUY PRICES For Gold Eagle & Buffalo Update
U.S. MINT GOLD COIN SALES ALREADY DOUBLE vs. 2019: Best BUY PRICES For Gold Eagle & Buffalo Update
Sales of the U.S. Mint Gold Eagle and Buffalo coins are already double what they were for full-year 2019. And, with the Fed and central banks continuing to print money hand-over-fist, I doubt the demand for gold coins will diminish anytime soon.
Interestingly, sales for precious metals bullion retail products, according to Dan at Cloud Hard Assets, are running about 60% for gold and 40% for silver (total value, not ounces). Investors would be buying more silver, but due to the backlog and shortage of retail silver bullion products, individuals are being forced to buy more gold.
According to the U.S. Mint’s most recent update, sales of 2020 Gold Eagles totaled 332,000 oz compared to only 152,000 oz for 2019. Furthermore, Gold Buffalo coin sales have reached 117,500 oz versus only 61,500 for 2019. Again, we are only five months into 2020, so it will be interesting to see what demand for these U.S. Gold coins will be for the remainder of the year.
Investors looking to acquire Gold Eagles and Buffalos are still paying high premiums. In comparing the premiums for 2020 Gold Eagles and Buffalos, the best value that I could find from the leading online dealers is about 8%. However, the Gold Buffalo coin premiums were even higher.
Here is an update on the BEST BUY PRICES for 2020 Gold Eagles and Buffalos from the leading online dealers’ vs. CLOUD HARD ASSETS (Prices below based on $1,745+ gold spot price early Thursday):
As you can see, it’s important to compare the prices of gold bullion products (and services). Moreover, I am putting together a spreadsheet comparing the top online dealers’ Silver Eagle premiums vs. CLOUD HARD ASSETS. Today, the top online dealers 2020 Silver Eagle premiums are running about 59% of the current spot price vs. 39% for CLOUD HARD ASSETS. Again, it’s wise to compare prices and services at the different precious metals dealers.
…click on the above link to read the rest of the article…
CHART OF THE WEEK: Primary Silver Miners REAL COST Higher Than Published All-In-Sustaining Cost
CHART OF THE WEEK: Primary Silver Miners REAL COST Higher Than Published All-In-Sustaining Cost
The chart of the week shows that some of the leading primary silver miners total REAL COSTS are higher than their published All-In Sustaining Cost. My analysis suggests that the companies’ All-In Sustaining Costs (AISC), are not really “All-In.” So, I quickly did my calculations based on these companies’ adjusted earnings. If I used their net income, their estimated Breakeven would be much higher.
In the chart below, the four primary silver mining companies (if we can still call some of them that) posted their AISC for Q1 2020. The biggest JOKE of them all is Hecla, which reported a low $11.06 All-In Sustaining Cost for silver. Well, that’s surprising when Hecla suffered a $17 million net income loss for the period. So, how could Hecla be losing money if its All-In Sustaining Cost was $11.06 when they received $16.94 per ounce for their silver during Q1 2020?
It’s quite simple… the All-In Sustaining Cost is a BOGUS METRIC used to confuse and bamboozle unsophisticated investors… and it works like a charm:
So, if you scan across the chart above, you will see the individual company’s AISC in BLUE, while the RED BARS show my simple estimated Breakeven for each. Endeavour Silver gets the TAKE ME OUT THE WOODSHED AWARD because it’s losing money hand-over-fist ever since it had to shut down its El Cubo Mine, a COMPLETE WASTE of a mine that should have never been acquired by the company.
In a nutshell, if you are a new investor looking for HOT silver mines to invest, do me a favor and pay no attention whatsoever to the All-In Sustaining Cost metric. I need to do more analysis in this area to help investors from buying the WORST CANDIDATES in the industry.
Important Factors Impacting The Gold & Silver Supply And Price
Important Factors Impacting The Gold & Silver Supply And Price
The majority of analysts still don’t understand that gold and silver are based on two different price or value functions. To understand the future forecasts for precious metals, investors need to the difference between the two value functions.
In my newest video update, Important Factors Impacting Gold & Silver Price And Supply, I discuss in detail the two different price functions and why the current commodity-based mechanism differs from the precious metals “Store of Value.”
In the video, I explain why the “commodity-priced mechanism” is important as a floor for the gold and silver prices. Unfortunately, because Harry Dent doesn’t understand this mechanism, he continues to put out faulty and incorrect analysis on the gold price. Dent stated in his April 13th video update that during the next deflationary collapse of the markets, gold would head back down to $900-$1,000 or the lows of 2008 at $700.
Dent’s gold forecasts continue to be wrong because he fails to incorporate the impact of “ENERGY” and the “COST OF PRODUCTION” on the gold mining industry.
I updated Barrick and Newmont’s combined total production cost versus the gold price for Q1 2020, and was quite surprised. Again, I explain why I don’t see gold heading anywhere near $700 due to the significant increase in cost to produce the yellow metal since 2006 when gold was the same price.
This video took longer to publish then I had planned due to the research. I was quite surprised to see Barrick and Newmont’s total production cost rise to nearly $1,400 an ounce for Q1 2020 versus the $1,272 average for 2012, when oil prices were over $100 a barrel.
…click on the above link to read the rest of the article…
Top Primary Silver Miner Cost Of Production Now Breaking Even
Top Primary Silver Miner Cost Of Production Now Breaking Even
One of the top primary silver mining company’s is now breaking even producing silver. Pan American Silver just released its Q1 2020 Report surprising analysts by posting a net loss of $77 million. However, if we go by the company’s “Adjusted Earnings,” Pan American Silver reported a $7.6 million loss. This is the figure I use for my calculations in determining the “Estimated Breakeven.”
I will be posting a new Youtube Video update on the details of the Silver Market and the Breakeven Analysis this weekend.
Here is a quick peek of Pan American Silver’s All-In Sustaining Cost (AISC) that jumped in the first quarter of 2020:
According to Pan American Silver’s calculation of its All-In-Sustaining Cost for silver, it jumped to $15.26 in Q1 2020. The company stated the reason for the increase was mainly due to:
lower by-product credits, driven mainly by lower realized base metal prices; increased concentrate smelting and refining charges; and higher direct operating costs per ounce in part due to lower silver grades.
Because Pan American Silver produces so much copper, zinc, and lead, along with silver, these base metal prices impact the by-product credit amount in the analysis of the company’s All-In Sustaining Cost. The base metals prices declined considerably during the first quarter of 2020, thus pushing up the All-In Sustaining Cost for silver.
So, with Pan American Silver’s All-In Sustaining Cost for Q1 2020 at $15.26, it is now very close to the current spot price of silver at $15.48. However, with the lower oil price in April and May, this will likely lower the company’s production costs in Q2 2020. But, if base metal prices continue to be weak or weaker in Q2 2020, Pan American Silver may not see much of a lower AISC when the results come out in July.
Interestingly, my Estimated Breakeven for Pan American Silver is much higher than the company’s AISC. Again, I will provide the details in my newest video update.
Please check back for my newest Youtube Video Update this weekend.
THE END OF A U.S. OIL GIANT: ExxonMobil’s Days Are Numbered
THE END OF A U.S. OIL GIANT: ExxonMobil’s Days Are Numbered
ExxonMobil, the largest oil company in the U.S. and a direct descendant of John D. Rockefeller’s Standard Oil, days are numbered. The once-great profitable oil giant is now borrowing money just to pay dividends. How long can this charade go on?
Good question. Now, some may believe that ExxonMobil was forced to borrow money to pay dividends due to the collapse in oil prices as a result of the global contagion. However, the company hasn’t been able to pay shareholder dividends from its cash from operations over the past four quarters, even with much higher oil prices.
The leading culprit as to why ExxonMobil lacks the available cash to pay dividends stems from the lousy economics of its U.S. oil and gas wells, especially the company’s shale oil portfolio. Ever since ExxonMobil ramped up its domestic shale oil production, that’s when the financial troubles at the company began to intensify.
The best way to compare ExxonMobil’s U.S. Upstream (oil and gas wells) performance, BEFORE and AFTER SHALE, is to go back to 2004. Even though the oil price fell considerably in Q1 2020, it was higher than the oil price in 2004. For example, ExxonMobil’s U.S. Upstream Sector earned $4.9 billion in 2004 with an average oil price of $41.51 compared to a $704 million loss on a $42.82 oil price:
Furthermore, look at the U.S. oil production differences between 2004 and Q1 2020. According to ExxonMobil’s 2006 Annual Report, the company’s average U.S. oil production in 2004 was 414,000 barrels per day (bd) versus 699,000 bd in Q1 2020. Even with higher oil production and similar oil price, ExxonMobil’s U.S. Upstream Earnings in Q1 2020 were dismal in comparison. Moreover, the company invested $1.9 billion in CAPEX for all of 2004 on its U.S. oil and gas wells compared to the $2.8 billion just for Q1 2020.
…click on the above link to read the rest of the article…
THE DEATH OF THE BAKKEN HAS ARRIVED: Oil Production Down 30%
THE DEATH OF THE BAKKEN HAS ARRIVED: Oil Production Down 30%
With North Dakota Bakken oil production down more than 30%, the death of the mighty shale region has begun. There is no way for the companies producing shale oil in the Bakken to recover from this global contagion overnight collapse. Yes, it virtually happened overnight. Since March 1st, the Bakken has seen at least 400,000 barrels per day of production shut-in.
What took three long years for the companies in the Bakken to increase production from the lows in 2016, vaporized in just the past two months. Unfortunately, shutting in horizontal fracked wells is the worst thing a company can do. Why? When a horizontal well is prematurely shut-in, it causes a lot of problems that are expensive to remedy when restarting the well. So, many of these wells may be shut-in for good.
According to the Reuters article, ‘Like watching a train wreck’: The coronavirus effect on North Dakota shale oilfields:
Output has dropped by at least 400,000 bpd since March 1, nearly a third of the state’s around 1.4 million bpd output before the crisis. State officials expect the volume shut in to rise further.
“This is truly unprecedented,” said Lynn Helms, director of North Dakota’s Department of Mineral Resources, the state regulator overseeing oil production. In the days following the price collapse, oil companies sent teams out to shut wells.
Field inspectors, who work with the state’s 20 largest operators, had dire news for Helms, the worst of it from Continental Resources (CLR.N), the state’s largest operator. By April 21, about 95 percent of Continental’s production in the state had shut down.
Continental on average produced about 188,000 boepd in North Dakota Bakken during fourth quarter 2019, with about 1,540 net producing wells as of year end, according to company data. Other large producers in the state were also shutting down. Oasis Petroleum (OAS.O) was halting all drilling in the Bakken, where it pumped about 80,000 boepd at the end of 2019.
…click on the above link to read the rest of the article…
U.S. Public Debt Increases More In April Than During Entire 2019
U.S. Public Debt Increases More In April Than During Entire 2019
The U.S. public debt increased at the fastest rate ever during April. Due to the negative economic impacts stemming from the global contagion, the U.S. Treasury increased the federal debt by a whopping $1.3 trillion in a single month.
The additional $1.3 trillion of U.S. public debt during April would purchase approximately one-third of all the physical gold investment bullion in the world, which currently stands at $4.1 trillion. In just one month (April), Uncle Sam’s printing press or digital monetary liquidity could purchase 750 million oz of gold. That 750 million oz of gold would be 67% of the total Central Bank Gold Reserves.
So, at some point, the Fed and central bank monetary insanity will come back to BITE THEM HARD… LOL.
According to the data from TreasuryDirect.gov, the U.S. public debt increased by $1,287 billion ($1.28 trillion) during April:
Now compare that to the average monthly U.S. public debt increase of $106 billion in 2019. Thus, the U.S. public debt increase in April was even higher than in Full-Year 2019:
While it took twelve months for the U.S. Treasury to add $1,207 billion in debt (2019), it only took one month to increase it to $1,287 billion (April). I don’t believe Americans understand how much damage is being done to the U.S. Government Balance Sheet. Unfortunately, it’s only going to get worse going forward.
It is impossible to forecast the collapse of the U.S. Bond Market or U.S. Dollar. However, the current monetary policy taking place suggests that it’s going to be SOONER rather than LATER.
And, it’s all due to the Collapse in U.S. oil demand. Keep an eye on the U.S. Oil Industry and oil price for clues how quickly the domestic economy and financial system will head into a depression.
The Global Contagion Impacted Silver Production The Most
The Global Contagion Impacted Silver Production The Most
According to a new report released by GlobalData, the global contagion impacted silver production the most while gold mine supply fared the best. The two largest silver producing countries, Mexico and Peru, have issued temporary shutdowns lasting nearly two months.
Peru, which started its lockdown on March 15th, extended it last week to end on May 10th. The Mexican Government issued their temporary shutdown on March 30th and have also extended it to May 30th. With Mexico and Peru on lockdown, a considerable amount of silver mine supply has been curtailed.
I came across this data from the Kitco.com article by Anna Golubova, COVID-19 mining shutdowns hurt silver production the most, gold the least – report:
The latest report from GlobalData looked at different mining sectors and how they have been affected across the globe. Silver fared the worst, while gold was hurt the least out of all the major mining sectors the report looked at.
There were temporary shutdowns introduced by more than 1,600 mines across 32 countries as of April 3, the report stated. Since then, the total mine shutdown have already dropped to 729, GlobalData added.
… At the end of the day, silver production was hit the most by temporary shutdowns. As of April 27, there were an equivalent of 65.8% of yearly global silver production still on hold, GlobalData identified.
As the GlobalData reports, nearly two-thirds of current global silver mine supply was still on hold. So, it depends on how long these primary and by-product silver mines have been offline.
Here is a chart using the data from the article linked above:
…click on the above link to read the rest of the article…
FIRST SHALE OIL DOMINO TO FALL: More to Follow
FIRST SHALE OIL DOMINO TO FALL: More to Follow
In a stunning news release, Continental Resources, the largest shale producer in the Bakken, is shutting in most of its production in the region. That is one hell of a lot of output to shut-in as Continental Resources was producing over 200,000 barrels per day in the Bakken at the end of 2019.
From the data on Shaleprofile.com, Continental Resources had over 2,200 wells in the North Dakota and Montana Bakken producing oil and gas during February this year. How many wells will Continental’s Harold Hamm shut in the Bakken?? And how many will be brought back online, at to what cost, when the market recovers??
According to Reuters, Continental Resources halts shale output, seeks to cancel sales:
April 23 (Reuters) – The largest oil producer in North Dakota has halted most of its production in the state, notifying some customers it would not supply crude at current pricing, according to people familiar with the matter.
Continental Resources Inc, the company controlled by billionaire Harold Hamm, stopped all drilling and shut in most of its wells in the state’s Bakken shale field, said three people familiar with production in the state. North Dakota is the second-largest oil-producing state in the United States after Texas.
This is terrible news for the U.S. Shale Oil Industry because $200 billion in debt is due over the next four years. How are they going to repay this debt if shale companies stop drilling and shutting in production??
If we look at the top five shale oil producers in the Bakken, Continental Resources was clearly ahead of the pack:
This chart from Shaleprofile.com shows that Continental Resources produced more than 200,000 barrels per day in the Bakken at the end of 2019. Hess, which is the second-ranked company, followed by a wide margin at 145,000 barrels per day. Interestingly, the third-largest producer in the Bakken is Whiting Petroleum that just filed for Bankruptcy on April 1st.
…click on the above link to read the rest of the article…
IMPORTANT TOM CLOUD PRECIOUS METALS UPDATE: Including Gold & Silver Eagle Best Buy Prices
IMPORTANT TOM CLOUD PRECIOUS METALS UPDATE: Including Gold & Silver Eagle Best Buy Prices
As the global contagion continues to cause a great deal of uncertainty in the markets, I thought it was a good idea for precious metals dealer Tom Cloud to provide a new update. Tom starts off the video saying that in his 44 years in the industry, he has never seen anything like the current situation in the precious metals markets.
Tom stated that one of his wealthier clients last week took money out of the banking system and purchased a large sum ($millions) of physical precious metals. Unfortunately, there still are only a fraction of financial planners that advise their clients to own a percentage of physical gold and silver in their portfolio. I believe investors should be increasing the typical 5-10% of precious metals in one’s portfolio to at least 20-25%.
Tom also went on to say that some leading financial analysts are calling for a 30% drop in U.S. GDP by Q2 2020. This is no longer a recessionary event. Rather, we are heading into a Depression, the likes we haven’t seen for nearly eight decades. Very few Americans are prepared for what’s coming.
With investment demand for physical precious metals at near-record levels, Gold and Silver Eagle premiums are some of the highest ever. It is quite amazing to see Silver Eagles buy prices more than $10 over the spot price. One large online dealer is selling its Silver Eagles for nearly $12 over spot. Thus, Silver Eagle premiums are ranging between 50-80% over spot.
I also wanted to provide an update on the Gold & Silver Eagle BEST BUY prices. I spoke to Tom yesterday for about a half-hour. He told me that Silver Eagle premiums increased again, but CLOUD HARD ASSETS still has the lowest prices versus the top leading online dealers:
…click on the above link to read the rest of the article…
