Steve St. Angelo: Exponential Debt Cycle is Past the Point of no Return

Tom welcomes back Steve St. Angelo of the SRSrocco Report for a discussion on the record-high prices of gold and silver. St. Angelo suggests these levels for silver could be a new floor as they've historically returned to production costs following price spikes. The average cost of primary silver production is around $26 an ounce, taking taxes and developmental costs into account.

St. Angelo stresses the importance of distinguishing investment demand from industrial demand when analyzing the silver market dynamics. A decade ago, there was a significant silver surplus due to decreased industrial demand which has since reversed with increased investment demand. Industrial demand is expected to consume all available supply, making additional investment demand potentially price-volatile.

*Palisade Radio Links:*

Steve explores the impact of energy scarcity and continued money printing on production costs, driving up gold and silver prices due to inflationary pressures. They discuss the possibility of a market correction offering the last chance to buy silver at present rates.

Steve and Tom delve into the relationship between expanding money supply, debt, federal funds rate, and silver price. Looking towards the period leading up to 2025, a market correction is anticipated due to increasing unemployment and possible employment data revisions. Economic weakness could lead to reduced interest rates and more money printing, instigating inflation and purchasing power reduction. However, Commitment of Traders reports may not accurately reflect demand.

The global silver mine supply and output have been declining since 2015, necessitating existing inventories to bridge the deficit. This imbalance could lead to a substantial correction when prices significantly surpass production costs. Concerns about marginal silver supply include transparent and non-transparent inventories, solar industry demand, and copper prices as indicators of industrial demand and potential recession.

Steve discusses the shift from LBMA to ETF silver inventories. Pre-pandemic, there was significant physical buying leading to expanded ETF inventories. However, in 2022, overall LBMA inventories decreased due to Indian purchasing and ETF withdrawals.

Finally, Steve discusses the merits of assets such as Bitcoin, gold, and silver. While some view Bitcoin as a digital counterpart to gold, Steve contends that saving in Bitcoin is not the same as saving in precious metals. This is due to Bitcoin mining causing considerable share dilution and due to the energy costs.

Steve advocates understanding asset worth based on economic progress versus past activity, emphasizing energy's role in asset value, and preparing for future energy realities.

Talking Points From This Episode
- Silver's new floor could be around average production cost ($26/oz).
- Industrial demand vs investment demand crucial in analyzing silver market dynamics.
- Economic instability, the energy cliff, inflation, and supply concerns may lead to significant price volatility.

Time Stamp References:
0:00 - Introduction
1:22 - New Silver Price Floor
3:30 - Miners & All-In Costs
5:55 - Energy & Money Supply
8:44 - Types of Metal Demand
11:35 - Money Printing & Silver
15:13 - Purchasing Power & Rates
17:06 - Fed Cuts & Corrections
21:37 - Utility of COT Reports
23:52 - Mine Supply & Output
28:44 - Silver & Manufacturing
31:54 - Grid Stability & Solar
34:40 - LBMA Silver Trends
37:06 - Miner Production & Shares
40:35 - Dedollarization & Gold
47:50 - Dr. Copper & Economy
51:34 - Energy & Volatile Mkts.
54:13 - Energy, GDP, & Debt
55:20 - Federal Deficits Chart
57:10 - Trends & Collapse
1:00:48 - U.S. Spending & Budget
1:02:50 - Bitcoin & Precious Metals
1:06:10 - Energy Store of Value
1:09:25 - Wrap Up

Guest Links:

Independent researcher Steve St. Angelo (SRSrocco) started to invest in precious metals in 2002. Later on, in 2008, he began researching areas of the gold and silver market that, curiously, most of the precious metal analyst community have left unexplored. These areas include how energy and the falling EROI "Energy Returned On Invested" stand to impact the mining industry, precious metals, paper assets, and the overall economy.

Steve considers studying the impacts of EROI one of the most important aspects of his energy research. For the past several years, he has written scholarly articles on some of the top precious metals and financial websites.

[yumorules]

Tom the hardest working guy on YouTube. Love your channel mate.

[JohnS-hshb]

Steve St Angelo is the best. He is in a league of his own when it comes to insightful independent thinking.

[collinmcdevitt]

Love seeing Steve St Angelo on. Great insite into energy.

[TexSilverFarmer]

Steve St Angelo knows his stuff, everyone would be well served to heed his advice.

[KurtWittendorfer]

Very worthy insights to consider. I look forward to anytime that Steve St Angelo speaks. Kinda like the E.F. Hutton commercial in the day….but for real.

[melindaxbc]

Profoundly important information in this interview. Thank you so much, Tom, for having this deeply knowledgeable guest. Love your channel!

[fbazzrea]

i always enjoy Steve's perspectives. ty gentlemen

[jimmillward]

never ceases to be a fascinating listen.

[carolinageduldig]

A fantastic Interview, 1st class Guests, a fantastic channel!!!
I hear with great pleasure everything on your channel learning a lot. ❤❤❤
Many thanks and greetings from Germany / Bulgaria ❤❤❤
Please....go on because it's all so interesting!!!

[MA-jxyq]

Tom always has great questions. Steve St Angelo & Ted Butler (RIP) are the best to listen to about Silver!

[mennobaron]

Steve's vision is the 100% opposite of the Green Chicken's (Doomberg's) vision of energy..
Would be really great to have a discussion between them here on Palisades!!!
I rather put my bets on the Chicken's view on energy which is very wel studied and documented..

[TonyL-gwqx]

Steve is it ever a good time to buy gold or silver? I left because you never told subscribers it’s a good time to buy? All the way back to 1700-1800 per ounce gold.

[thriftybob]

It was recently reported that the Saudis had recently secretly bought 160 tons of Gold. That would be 160 tons x 32, 000 oz x $2600 = $13.3 billion. What I see as important there is that this was recent, not back when Gold was $2, 000.

[thomasbeslanovits]

SILVER HAS ONLY ONE WAY TO GO UP AS THE USE OF SILVER GROWS EVERY DAY AND AS MONEY TAKES OFF AS AMERICA PAPER DIES.

[mariner]

I I buy Barrick mining, GOLD . Smartest ceo and almost no debt. Huge reserves ..

[TonyL-gwqx]

Times have changed and cost of production means nothing to central banks ! I don’t pay attention to technical charts when banks are buying non stop.

[elonmuskox]

David Morgan said there is 500 ounces of silver in a Tomahawk cruise missile. This demand is not counted by the Silver Institute.

[Diogenes]

I am a little puzzled by the idea of gold and silver as storing energy value. I quite agree that energy has gone into producing them. But you can’t turn them back into energy.

[angry-white-men]

History shows us that society/empires have gone backwards. After the Roman empire collapsed in Rome and moved to London, the manufacturing economy restarted again as all the technology from the old empire was lost.

[youtube_is_a_POS]

I think his energy take is very compelling.
I have an issue with peak energy -> it will be self induced aka de pop