Ted Butler: Silver's Bull Run — Price Drivers, Stocks, What's Next
Summary
Silver Market Dynamics: Ted Butler discusses the rapid rise in silver prices, nearing the $50 mark, and highlights concerns about the sustainability of this rally while predicting eventual breakthroughs due to increased media coverage and public participation.
Backquidation Phenomenon: The silver market has entered backquidation, where futures prices are below spot prices, leading to increased demand for physical silver, potentially driving prices and premiums higher.
Gold-Silver Ratio: Despite the rise in silver prices, the gold-silver ratio remains high at 80, suggesting silver is still historically undervalued and could reach $60 by reverting to historical averages.
Indian Demand and Rate Cuts: Indian demand for silver and recent Fed rate cuts are significant catalysts for silver's price increase, with expectations of further rate cuts potentially boosting silver prices.
Safe Haven and Military Demand: Geopolitical tensions and military applications are driving safe haven demand for silver, with historical precedence of increased silver consumption during conflicts.
Platinum Market Insights: Platinum is experiencing a supply deficit, with demand driven by catalytic converters and jewelry, particularly from China, while supply challenges persist in South Africa.
Platinum-Gold Valuation: Historically undervalued compared to gold, platinum presents investment opportunities, with its price dynamics influenced by geopolitical and economic factors.
Investment Strategies: Butler emphasizes the potential in silver and platinum markets, suggesting exploration companies for high-risk investors and highlighting the importance of understanding market fundamentals for long-term gains.
Transcript
[Music] I'm Charlotte Mloud with investingnews.com and here today with me is independent analyst Ted Butler. He writes for Ronnie Sturfl's in gold we trust report, Peter Crow silver advisor and David Morgan's The Morgan Report. Thank you so much for being here. Great to have you once again. >> Thanks for having me Charlotte again. I'm really looking forward to talking silver, gold and and platinum with you today. really looking forward to it as well. We've got a lot to go through and we're catching up on our last conversation about 3 months ago in July. You were telling us at the time that this was Silver's moment. We'd gotten through that important 35 $36 level and you were pretty confident that we were going to keep going higher, which of course we we've seen that happen. So, I want to start by checking in with you on silver. You expected this move, but did you see it happening quite so fast? How are you feeling? >> Well, I think we're all happy to see silver finally within touching distance of that $50 level. Um, I didn't actually expect it to happen so quickly. In fact, I think it's a bit concerning how quickly it's happened in terms of the sustainability of the rally. However, I do think that we will eventually break through $50. Uh, I'm not sure if it's going to be exactly in this cycle. um you know in the near term at the end of this year uh there might be some sort of uh high level consolidation as David Morgan calls it or or some kind of healthy correction but ultimately it will break through and that's going to happen because when it does cross 50 uh mainstream media coverage will begin and that's where we're going to start to see the generalist come in. we're going to start to see uh the public participation phase as as we call it in this cycle and that's going to all pile up on top of the institutional demand that's already starting to build up. Um and and one of the technical reasons why I actually believe that it's going to break through at the $50 level is that the silver market has now entered what we call backquidation which is a phenomenon where the futures price trades below the spot physical price. Uh normally this results in an overwhelming demand for physical. Um that could take the form of SLV investors standing for delivery. Uh whether that be the the industrial players who are notoriously re resolute or even you know billionaire whales from India. Uh and we'll get to India later. But in that event, which is already playing out by the way, uh silver prices and premiums will continue to increase, maybe even dramatically uh as the news of insufficient physical silver transmits itself through the market. Um so that's where I'm at at the moment. There's a lot of other reasons why I'm excited in terms of the gold silver ratio. Um and and that is obviously at 80 80 uh the 80 mark. Um that's still quite high for historical standards. Um typically uh the gold silver ratio averages you know over the last century between 50 and 60. Um and and basically now with the gold price at 3,800. If we take the midpoint of that gold silver ratio which is 55 over the last kind of 100 years we're talking about $60 silver. But that's just reverting to the historical mean. So silver based on the gold silver ratio despite its rise is still historically undervalued. And if you even want to take it further than that and look at the gold silver ratios of 20 to 30, uh, back in the bull markets of 2011 and 1980, we'd be looking at $120 silver or even maybe $200 silver. So the idea that this bull market is over is a fallacy. I would exercise caution because I do believe we do a correction, but I'm very happy with silver's performance so far year to date. Lots of directions for us to go in there and a good summary of what you see going on with silver. I want to ask a little bit more about the maybe the gold silver ratio angle and the relationship with gold for silver. One thing I've been asking quite a bit lately to the experts I've been speaking with is okay, we have this rise in silver. How much do you see being related to silver specific factors and how much is more silver finally starting to follow gold higher? How do you see it? You know, I think it's a combination of the two, Sean. I really do. Um, I think gold's performance has been unbelievable, uh, year to date. I do think we're getting to the point now where gold could be I think gold is in the public participation phase now, the actual gold price itself. I think there's still a lot of room left for mining stocks. We can get to that later. Um, but really it's silver's time to shine. Uh I do think like you say that the factors on the demand side we already know that silver's in in a supply demand deficit and has been for the last 5 years um to the tune of I think the equivalent of one year's mine production. Um but but in terms of the factors I think India has been a big catalyst in this. I think when we spoke in Boca Raton, Charlotte, you might remember that I mentioned that um Indian demand was one of the big drivers I was watching. Uh and in part that was due to the fact that 40% of the entire country's retail investment demand went into silver ETPs in 2024. So that's the entire country, the retail investment demand into silver ETPs, not gold, silver. And that trend has actually continued further into 2025 uh with Indian silver imports now sitting at all-time record highs right and that doubled uh from September to o uh to August sorry um during that period and as we know the silver price went from 37 to $48 in in that those two monthly periods and I think that Indian demand had a great deal to do with that. In terms of other catalysts, I do think that we've had um you know, if you look back to the rate cuts that we had in September, um another big catalyst was was definitely the the fact that Jerome Powell decided to cut 25 basis points. Um I think President Trump will be very happy with that after all the pressure that he applied on on Jerome Powell. Uh, and now last time I checked, I think investors were pricing in uh an 86% chance of another 100 basis points worth of cuts by by July next year. Uh, and as you know, as I mentioned in the interview last time, uh, silver produced an average of 332% um after the uh after a rate cut in uh the first rate corner cycle began uh since 2000. So with that in mind, I totally expect that that rate cuts will um continue to cause the silver price to rise if we see more of them later this year. >> I do remember talking about India in that last interview and definitely the Fed rate cuts have come to the four since since we've been speaking. Any other important silver catalysts that you are watching heading into the future? You know what? I think one of the big ones uh in light of the kind of um geopolitical tension that we're living in right now is safe haven demand. And many people associate safe haven demand with only gold u which is true to an extent but silver really does perform well in um incidences instances of um geopolitical turmoil um you know whether it's um Israel Iran situation uh whether it was Russia Ukraine uh you know historical events going back to you know the 1980s or whatever there's definitely been a link there between the silver price and wararm mongering. Um, and obviously when you've got the new secretary of war, uh, Pete Hex saying to ensure peace, uh, we must prepare for war in his big speech the other day. Um, that could be quite forboding in light of the um, US strikes on Venezuelan boats in in the Caribbean. Um, so you've got all of these different trends. In the same time, you've got the EU. Uh they just put out this like uh rearm Europe program for 2030. Uh it was introduced in March and we wrote about in the engulf trust report. It basically is designed to mobilize a colossal 800 billion euros over four years to finance the European defense readiness. And let's not forget that actually in the height of of the World War II in 1943, we've got this on record that the US consumed 200 million ounces of silver in that year. Now, at present, we estimate that it's somewhere around 40 to 50 million ounces a year based on the dots that we're connecting. Um, because a lot of that is is guarded as a secret, not that military information. Um, but ultimately it wouldn't be far-fetched to see that that 40 to 50 rise, not towards 200 because we're not at that level yet, but silver is is a critical metal. It's absolutely essential for military applications. And so if we see these tensions continue to rise, Charlotte, we could see the silver price rise from safe haven demand, but also as its demand for military applications rises, too. >> Yes, I think that's a really important one to go into. So, thanks for touching on that as well. I want to look a little bit more closely at the price. So, you do see silver getting past 50 and beyond, but you mentioned 50 maybe not in this this current cycle that we're in right now. So, I'm wondering if we can go into that a little bit more because of course people are excited to see silver move, but we can't forget that volatility angle that's inherent for silver, >> right? >> Yeah. Well, well, silver volatility is an opportunity as I think Peter Kraut, uh, my my colleague actually says, um, but up to now we haven't really seen that much volatility. This rise in the silver price has been quite clean and quite inter uninterrupted. Uh, and what that means is that until we get that volatility returning, the silver price could continue to to mar through the 50 level. I do feel that psychologically it is a limit that that of a resistance in people's heads. But when I say it's not going to cross in this cycle, I don't mean um in the next year. I do believe it will probably cross early next year the $50 level. Um but actually I think it would be healthy if there's some kind of high level consolidation around this sort of 46 4748 level. um you know as a kind of um as opposed to going directly in a straight line upwards to sort of staircase upwards um it would be a lot healthier for the silver price long-term sustainability to stay there. Um of course there is obviously the downside risk too. Now, we can't deny that. And it's important to note that all of these industrial applications, which is now a big part of silver demand, um that just got a whole lot more expensive, right? So, on the solar side, um you know, the the cost of, you know, implementing silver into solar panels has basically doubled uh from, you know, $25 a few a few months ago to to now near $50. Um, so that could have an a short-term impact and and you know as more data is released into the market will see that. Um, but I'm that doesn't change my long-term perspective on silver that we're still in a supply deficit. The damage was already done from the mine production perspective because it takes 10 to 15 years to get a silver mine from inception to production. And you talk about you think about all the different jurisdictions where you know silver is mined and and you look at like places like Mexico um being being the main one and and silver production has been falling in Mexico the last few years quite considerably. So the the idea that you know it's going to stop below 50 is is not a reality for me. I really do believe that it would be a pause and not um and not a a meaningful decline. Yeah, I think that helps to elucidate your thinking there. And I want to talk a little bit more about silver beyond 50 because you're mentioning, okay, this is the level where you see the general public get more interested in silver. They start to come in and I'm wondering what more you can say about what we might see there as we get into kind of that blue sky area that we haven't been before. >> Yeah, that's a great question, Charlotte. I think typically when when there's a breakout and when a stock or commodity price heads beyond heads into uncharted territory um it it it does continue to rise um and that's because there's there's no more strings attached you know the bets are off and and so I wouldn't be surprised to see it you know if the momentum is good that the you know the silver breaks its way through 50 and continues to maraud up to that sort of hundred $100 level um simply due to the media attention that would would um come into the silver market. You know, you're going to have people who haven't even heard about silver in their lives, have completely forgot that it was even an investment, didn't even know you could invest in it, and the generalists are just going to pile in. And and silver is such a tidy market relative to gold. You know, I think the market cap silver is like 20 billion um the silver market compared to gold, which is, you know, multiples more than that. So it wouldn't take a lot for, you know, think about all the the money sitting in money markets right now. You know, I saw at the start the other day that it had been revised to to from 5 trillion to 7 trillion. If if a tiny percentage of that makes it way into the silver market, there's going to be these um disproportionately large returns and as we know the the London market right now is a choke point. you've got like um very very low levels of physical silver in the in the LBMA inventories. A lot of that went to across the B across the the Atlantic to the US uh earlier this year. Uh but I really do believe that those those um inventories could continue to be drained and when the journalists come in that that will be the the the straw that breaks the camel's back if you like. So big implications for the silver price, but for the silver companies as well. And I'm wondering if we can take a look over at the silver stocks. Of course, people typically look at them because they want to see them outperform silver itself. So I'm curious what you're seeing so far from silver companies in terms of their performance compared to silver and where you're focusing right now among the companies. Yeah. So, uh, I write for the Peter Kraut and and we work on the the silver companies, uh, for the silver advisor service that we provide. Um, so, essentially, I'm I'm very happy with where we're at at the moment. I do I do believe that, you know, a lot of us are maybe 150% 200% up. And that can be very tempting to look at those gains and think, you know what, I'm going to take some gains. I'm going to I'm going to trim, you know, I'm going to take a third of my profits, maybe even half. I may even sell the whole thing. I I'm not going to be doing that because I see the the long-term um the long-term rewards of this this silver bull market. Yes, there will be corrections. Jeff Clark, one of our colleagues as well, pointed out in his recent uh speech at myth that sometimes these corrections can be up to 20% intra bull market, you know, in the silver m silver and gold mining stocks. So, up to now, we've we've kind of seen maybe 5% corrections, maybe 7% corrections, depending on which stocks you're looking at. But there's probably going to be more of that. And if if that's not what you like, if you don't have the stomach for that, then then maybe this this industry isn't for you. But when you understand the fundamentals, when you understand that these companies um have paid down a lot of their debt and they're in a better financially position financial position than they were in previous years. When you consider the quality of the management teams that are out there, you consider that uh mergers and acquisitions are picking up finally again and and we're having sort of record financing months such as we did last month um for for mining and gold and silver miners. I I think we're in an excellent position and and you know it's really depends on your risk tolerance as to whether you want to take profits now or hold on for the ride. But in my opinion, the ride's going to continue for you know one or two years at least. And it also I think depends where it depends on yourself where you want to focus in terms of the cont companies the bigger ones or the smaller ones. Where do you see the most potential at this point in terms of share price gains? >> I I think obviously the the highest potential and the highest risk simultaneously lies in the exploration place. um depending on whether you come in at it from a wealth preservation perspective or or uh a speculation perspective, you're going to have a different uh perspective. Um I do believe that as a young guy, you know, I'm 24 years old uh getting on 25. Um I do believe that what do I have to lose, you know, to to speculate in these exploration companies. So I've got a longer time horizon, so my risk tolerance is higher. you know, if I were an older person, maybe 70, you know, 75 years old, I'd be thinking more about wealth preservation. I'd be thinking more about royalty companies, and I'd be thinking about quality, um, that would would allow me to maybe have a dividend from my for my pension, from retirement, your IRA, whatever. So, it depends, but for me, I'm I'm looking at the exploration companies. Um, you know, I think the opportunities below uh 500 million market cap are excellent. Obviously, high risk, so be careful. Uh but if that's what you're interested in, we we cover the best uh for the silver advisor on our service. So uh please check that out. >> Okay, very very well put there. And we've talked about silver. We want to take a look at the other precious metals as well. And where I wanted to move over is platinum. So this is another one that we talked about a few months ago during that other conversation that we had. And you're mentioning the potential that you were seeing there. It's another one that has been in deficit for years and we've seen the price really moving again since that last conversation. So I'm wondering if you can start by reviewing what is behind this move in platinum where it feels like it's been building for quite some time. >> Yeah, I know it's one of my favorite favorite stories I suppose in the commodities over the last few years. Many people benefit from the uranium bull. Um many people got in on gold really early, me included. Uh, but platinum was one that at the Morgan report we we called when it was at $950 and we're very proud of that. It's now $1,600. So, we can't say that it's the, you know, the stone cold bargain that it was at that price, but I do believe it's good value. And one of the reasons I believe that is because of the exa existing supply deficit as you point out Charlotte. Um, and and actually that is uh being exacerbated at this point in time. Um, specifically it was about 968,000 ounces last year, which is about 15% of the annual mine production. And and many of those demand drivers, you know, um, you know, they're kind of ancillary like electronics, dentistry, um, things that you, you know, wouldn't really expect. But the main one is catalytic converters from the automotive industry. And that's responsible for about 43% of the total demand. And uh to quote the the great rig rule, he said that the amount of platinum used in a catalytic converter is tiny compared to the overall vehicle price, just a couple hundred in a car uh costing well over $150,000. So that kind of price inelasticity means that even if platinum prices were to double, it would barely move the needle on the final vehicle price, which is why that demand category is so solid. So in in the Catholic to convert demand segment, platinum kind of has a price flaw. Um but actually what what's interesting, Charlotte, is that jewelry demand, particularly from China, has been the big demand driver in in the price rise in in of late. And um I think if I remember correctly, it was 151% yearonear uh that fabrication has increased uh in China's platinum jewelry industry. Um, and that's been helped by the relatively expensive gold prices relative to platinum. Um, and and ultimately those those two demand drivers of jewelry combined uh combined with the catalytic converters are coming together converging to to exploit a dwindling supply and 70% of that platinum supply is located in South Africa. Uh everybody knows that in South Africa they've had problems with load shedding in recent years which is basically due to a dependence on their dilapidated um coal powered um uh power grid and production in South Africa of platinum was fallen about 15% from its peak in 2021. it fell year on year last year as well. And so that combination of um you know an insecure energy supply and also the corruption also the crime also uh the high levels of bureaucracy in South Africa is making it quite difficult really and and the interest in platinum isn't hasn't been you know historically strong and now we're seeing the effects of that in the supply which is being exploited by the demand. So supply demand is is excellent and and also as I'll get into later um you know it's historically undervalued relative to gold platinum as well. >> Right. This is where I was hoping you would go with this. I was wondering if you could give some context on the platinum price because of course this year we look at it and it feels like it's made a really big move but from a historical perspective it's it's lower than it has been before. Usually it's more comparable to gold. So, how how should we situate ourselves when we look at the platinum price? >> Yeah. So, basically through the 1990s before I was born and and the 2000s, you'd need at least 1 oz of gold to buy 1 oz of platinum. And at certain times, like in 2000, 2008, you'd even need 2 or 2.1 ounces of gold to buy 1 oz of platinum. Obviously, after gold's relentless rise to 3,800, I think even nearly 3,900 today, that dynamic has now flipped. Um, in other words, you'd need uh I think I think roughly 4/10 of an ounce of gold to buy 1 oz of platinum at today's price of 1,600. That's about right, isn't it? Um, so that's actually pretty close to the most undervalued platinum has been relative to gold for at least 35 years. uh and the exact bottom in that platinum gold ratio uh came in April of this year around 0.28 now at 0.4 for so it's still a lot of value considering that it's been you know up at 2.1 at its peak and averaging you know one at least um so if you're thinking if gold stays at these levels which I do believe it will like as part as as part of this high level consolidation that I think we will see because every drop every dip in gold institutions are buying ETF holders are buying it it's it's the the most robust bull market I think we've seen since the 70s um so with All that in mind, you think that platinum's rel relative valuation to gold is actually very very cheap even after the 72% year-to- date rise this year. So that's very exciting as a platinum investor myself. >> Yes, I think those ratios really help to give some context on where where we're actually at compared to history. And so I think that people are definitely now seeing the case for platinum and they wonder all right how do I get exposure from the picture you're painting of the South African miners sounds like maybe that might not be the direction to go and I know there's kind of limited companies outside of South Africa they're doing platinum. So is it is it safest or best to just look at the metal or how are you approaching it? I I think there are there are very few and far between quality platinum miners or um even juniors. There's very very few juniors even less outside of South Africa and Russia which is where the majority of the of the supply is located. Um I do have a have investment personally full disclosure in uh in Still Water Critical Minerals which are based up in Montana. Um they've got a PGM complex with a lot of nickel as well in there. um which is adjacent to to uh Sivven Stillwaters project. It's part of the same sort of spin-off but separate companies. Um so that's one of the options. Um outside of that there's there's a couple. There's one in Brazil um that I that I own um Bravo Mining um which were actually also I believe at the at the event uh Rick's event in in Bocaraton that we both were there at. Um so there are a few but for me South Africa and also Russia for obvious reasons due to the war are outbounds so you're really kind of um you're very hardressed to find platinum names in that sense I think you know always good to have some physical of course you know I would say silver and gold first to get your initial positions in there um but but platinum definitely as a speculation and as as an undervalued metal great to hold physically you might consider some ETFs. Um, I think there's a Sprat one. I don't own it personally, but I'm pretty sure there's a Sprat one and maybe an Abedine one as well. Um, might be wrong on that, but there's those options and there's those those companies that I mentioned. That's personally what I'm invested in, which is of course not a recommendation. >> Okay. So, so we've got options. If we want to look at platinum, you can go in a variety of different directions. All right. So, we've looked at silver and platinum. I we're getting to the end, but before I let you go, I do want to touch on gold at least. And there's a reason that we've saved it for last. We're mentioning before we turn the camera on that gold is it's not your most favorite precious metal right now. So maybe before I let you go, you can talk a little bit about why that is, where where you place gold right now, and your your outlook there. >> Yeah, I mean, I still think of the thing, show I I'm not bearish on gold at this point. I'm just kind of I'm almost exhausted from how long that this bull market is going on. I think we all are. We're all kind of maybe slightly concerned at how quickly and how intensely the gold price is rising. I still do think as we wrote for the sound money report, I wrote an article that about a month ago that said kind of gold is is still could be argued as undervalued. And I still stand by that when when you're looking at things like the monetary base, right? And the monetary base um has expanded um I think it was in 1980 it was 157 billion US and today it's expanded to 5.74 trillion and that's 3556%. Now gold in that time was somewhere around 350% increase. Um, so when you think about the extent of that increase relative to gold, you could even make the argument that gold's going to go further. And we're now approaching that round number of $4,000. You've got all this geopolitical uncertainty. You've got an absence of monetary stability with the with the dollar's continued demise. And it's getting quite concerning now how quickly it's it's falling. You've got policies in in the United States with Trump who inherently needs a weaker US dollar to to make the US exports more attractive on the global stage. You know, he is willing on the the Fed chair to cut rates which will initiate further weakness into the US dollar. So actually a lot of this gold price going up business is the US dollar going down. And when you look at what Russia and China are doing with their um shows of strength at these conferences in the world where they you know show all their military equipment which by the way looks very very advanced compared to what we're seeing in the west. You know, there's a lot of reasons why investors are are tuning into gold. And I don't think that central banks, you know, a lot of that central bank demand is is price inelastic. like platinum with the catalytic toic converters, the auto makers, central banks are also buying gold whatever whatever price it is because they know that it's going to hold its value as a store of value that's naturally scarce better than an infinitely printed paper piece of you know you fill in the blanks. >> Yeah, I think this is a sentiment I'm starting to see a little bit more often. The case for gold is of course still there, but you might want to be broadening your focus a little bit more when it comes to the precious metals. So really good way I think to start wrapping it up. And any any final thoughts you would leave investors with? It's clear that you have a lot of different places that you're working right now. Maybe you can also mention where we can find you. >> Sure. Um yeah, so I think the the overriding theme is that this is now time for performance gold. As we said in the in gold trust report this year, this is time for silver, the mining stocks to take on the baton from gold and start outperforming as they already are doing. After that, it will be the broader commodities uh complex, the industrial metals. That might be a few months down the line, maybe years down the line, but right now it's silver's time to shine. It's platinum's time to shine, and gold's going to continue consolidating and rewarding investors for their for their um you know, smart thinking. Um where you can find me uh best place is on LinkedIn or on on X TJ Butler. Um I'm writing for various different publications right now. We just started a new one called the sound money report which you can find on Substack. That's with Roy Surfer. I'll also be writing the silver chapter this year in the in Goldie Trust report uh for the fourth year running that'll be now. Uh I also write about specifically silver stocks um you know juniors typically or developers below 1 billion uh market cap and that's for the silver advisor which you can find uh on the goldadvisor.com uh that's with Peter Kraut and Jeff Clark and I also write for the Morgan Report and I have been doing for three years and uh David Morgan of course a silver expert who I owe so much to an absolute genius of the silver market and um I'm still continuing to do that and uh Yeah, thanks for having me, Charlotte. I really appreciate this, >> of course. And we'll have to have you back soon to catch up on what's going on. I'll include links in the video description so people can sort out where to find you. And yes, thank you for coming on. Once again, I'm Charlotte Mloud with investing.com and this is Ted Butler. Thank you for watching. If you like this video, make sure you hit the like button and subscribe to our channel. We'd also love to hear your thoughts, so leave us a comment below. 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Ted Butler: Silver's Bull Run — Price Drivers, Stocks, What's Next
Summary
Transcript
[Music] I'm Charlotte Mloud with investingnews.com and here today with me is independent analyst Ted Butler. He writes for Ronnie Sturfl's in gold we trust report, Peter Crow silver advisor and David Morgan's The Morgan Report. Thank you so much for being here. Great to have you once again. >> Thanks for having me Charlotte again. I'm really looking forward to talking silver, gold and and platinum with you today. really looking forward to it as well. We've got a lot to go through and we're catching up on our last conversation about 3 months ago in July. You were telling us at the time that this was Silver's moment. We'd gotten through that important 35 $36 level and you were pretty confident that we were going to keep going higher, which of course we we've seen that happen. So, I want to start by checking in with you on silver. You expected this move, but did you see it happening quite so fast? How are you feeling? >> Well, I think we're all happy to see silver finally within touching distance of that $50 level. Um, I didn't actually expect it to happen so quickly. In fact, I think it's a bit concerning how quickly it's happened in terms of the sustainability of the rally. However, I do think that we will eventually break through $50. Uh, I'm not sure if it's going to be exactly in this cycle. um you know in the near term at the end of this year uh there might be some sort of uh high level consolidation as David Morgan calls it or or some kind of healthy correction but ultimately it will break through and that's going to happen because when it does cross 50 uh mainstream media coverage will begin and that's where we're going to start to see the generalist come in. we're going to start to see uh the public participation phase as as we call it in this cycle and that's going to all pile up on top of the institutional demand that's already starting to build up. Um and and one of the technical reasons why I actually believe that it's going to break through at the $50 level is that the silver market has now entered what we call backquidation which is a phenomenon where the futures price trades below the spot physical price. Uh normally this results in an overwhelming demand for physical. Um that could take the form of SLV investors standing for delivery. Uh whether that be the the industrial players who are notoriously re resolute or even you know billionaire whales from India. Uh and we'll get to India later. But in that event, which is already playing out by the way, uh silver prices and premiums will continue to increase, maybe even dramatically uh as the news of insufficient physical silver transmits itself through the market. Um so that's where I'm at at the moment. There's a lot of other reasons why I'm excited in terms of the gold silver ratio. Um and and that is obviously at 80 80 uh the 80 mark. Um that's still quite high for historical standards. Um typically uh the gold silver ratio averages you know over the last century between 50 and 60. Um and and basically now with the gold price at 3,800. If we take the midpoint of that gold silver ratio which is 55 over the last kind of 100 years we're talking about $60 silver. But that's just reverting to the historical mean. So silver based on the gold silver ratio despite its rise is still historically undervalued. And if you even want to take it further than that and look at the gold silver ratios of 20 to 30, uh, back in the bull markets of 2011 and 1980, we'd be looking at $120 silver or even maybe $200 silver. So the idea that this bull market is over is a fallacy. I would exercise caution because I do believe we do a correction, but I'm very happy with silver's performance so far year to date. Lots of directions for us to go in there and a good summary of what you see going on with silver. I want to ask a little bit more about the maybe the gold silver ratio angle and the relationship with gold for silver. One thing I've been asking quite a bit lately to the experts I've been speaking with is okay, we have this rise in silver. How much do you see being related to silver specific factors and how much is more silver finally starting to follow gold higher? How do you see it? You know, I think it's a combination of the two, Sean. I really do. Um, I think gold's performance has been unbelievable, uh, year to date. I do think we're getting to the point now where gold could be I think gold is in the public participation phase now, the actual gold price itself. I think there's still a lot of room left for mining stocks. We can get to that later. Um, but really it's silver's time to shine. Uh I do think like you say that the factors on the demand side we already know that silver's in in a supply demand deficit and has been for the last 5 years um to the tune of I think the equivalent of one year's mine production. Um but but in terms of the factors I think India has been a big catalyst in this. I think when we spoke in Boca Raton, Charlotte, you might remember that I mentioned that um Indian demand was one of the big drivers I was watching. Uh and in part that was due to the fact that 40% of the entire country's retail investment demand went into silver ETPs in 2024. So that's the entire country, the retail investment demand into silver ETPs, not gold, silver. And that trend has actually continued further into 2025 uh with Indian silver imports now sitting at all-time record highs right and that doubled uh from September to o uh to August sorry um during that period and as we know the silver price went from 37 to $48 in in that those two monthly periods and I think that Indian demand had a great deal to do with that. In terms of other catalysts, I do think that we've had um you know, if you look back to the rate cuts that we had in September, um another big catalyst was was definitely the the fact that Jerome Powell decided to cut 25 basis points. Um I think President Trump will be very happy with that after all the pressure that he applied on on Jerome Powell. Uh, and now last time I checked, I think investors were pricing in uh an 86% chance of another 100 basis points worth of cuts by by July next year. Uh, and as you know, as I mentioned in the interview last time, uh, silver produced an average of 332% um after the uh after a rate cut in uh the first rate corner cycle began uh since 2000. So with that in mind, I totally expect that that rate cuts will um continue to cause the silver price to rise if we see more of them later this year. >> I do remember talking about India in that last interview and definitely the Fed rate cuts have come to the four since since we've been speaking. Any other important silver catalysts that you are watching heading into the future? You know what? I think one of the big ones uh in light of the kind of um geopolitical tension that we're living in right now is safe haven demand. And many people associate safe haven demand with only gold u which is true to an extent but silver really does perform well in um incidences instances of um geopolitical turmoil um you know whether it's um Israel Iran situation uh whether it was Russia Ukraine uh you know historical events going back to you know the 1980s or whatever there's definitely been a link there between the silver price and wararm mongering. Um, and obviously when you've got the new secretary of war, uh, Pete Hex saying to ensure peace, uh, we must prepare for war in his big speech the other day. Um, that could be quite forboding in light of the um, US strikes on Venezuelan boats in in the Caribbean. Um, so you've got all of these different trends. In the same time, you've got the EU. Uh they just put out this like uh rearm Europe program for 2030. Uh it was introduced in March and we wrote about in the engulf trust report. It basically is designed to mobilize a colossal 800 billion euros over four years to finance the European defense readiness. And let's not forget that actually in the height of of the World War II in 1943, we've got this on record that the US consumed 200 million ounces of silver in that year. Now, at present, we estimate that it's somewhere around 40 to 50 million ounces a year based on the dots that we're connecting. Um, because a lot of that is is guarded as a secret, not that military information. Um, but ultimately it wouldn't be far-fetched to see that that 40 to 50 rise, not towards 200 because we're not at that level yet, but silver is is a critical metal. It's absolutely essential for military applications. And so if we see these tensions continue to rise, Charlotte, we could see the silver price rise from safe haven demand, but also as its demand for military applications rises, too. >> Yes, I think that's a really important one to go into. So, thanks for touching on that as well. I want to look a little bit more closely at the price. So, you do see silver getting past 50 and beyond, but you mentioned 50 maybe not in this this current cycle that we're in right now. So, I'm wondering if we can go into that a little bit more because of course people are excited to see silver move, but we can't forget that volatility angle that's inherent for silver, >> right? >> Yeah. Well, well, silver volatility is an opportunity as I think Peter Kraut, uh, my my colleague actually says, um, but up to now we haven't really seen that much volatility. This rise in the silver price has been quite clean and quite inter uninterrupted. Uh, and what that means is that until we get that volatility returning, the silver price could continue to to mar through the 50 level. I do feel that psychologically it is a limit that that of a resistance in people's heads. But when I say it's not going to cross in this cycle, I don't mean um in the next year. I do believe it will probably cross early next year the $50 level. Um but actually I think it would be healthy if there's some kind of high level consolidation around this sort of 46 4748 level. um you know as a kind of um as opposed to going directly in a straight line upwards to sort of staircase upwards um it would be a lot healthier for the silver price long-term sustainability to stay there. Um of course there is obviously the downside risk too. Now, we can't deny that. And it's important to note that all of these industrial applications, which is now a big part of silver demand, um that just got a whole lot more expensive, right? So, on the solar side, um you know, the the cost of, you know, implementing silver into solar panels has basically doubled uh from, you know, $25 a few a few months ago to to now near $50. Um, so that could have an a short-term impact and and you know as more data is released into the market will see that. Um, but I'm that doesn't change my long-term perspective on silver that we're still in a supply deficit. The damage was already done from the mine production perspective because it takes 10 to 15 years to get a silver mine from inception to production. And you talk about you think about all the different jurisdictions where you know silver is mined and and you look at like places like Mexico um being being the main one and and silver production has been falling in Mexico the last few years quite considerably. So the the idea that you know it's going to stop below 50 is is not a reality for me. I really do believe that it would be a pause and not um and not a a meaningful decline. Yeah, I think that helps to elucidate your thinking there. And I want to talk a little bit more about silver beyond 50 because you're mentioning, okay, this is the level where you see the general public get more interested in silver. They start to come in and I'm wondering what more you can say about what we might see there as we get into kind of that blue sky area that we haven't been before. >> Yeah, that's a great question, Charlotte. I think typically when when there's a breakout and when a stock or commodity price heads beyond heads into uncharted territory um it it it does continue to rise um and that's because there's there's no more strings attached you know the bets are off and and so I wouldn't be surprised to see it you know if the momentum is good that the you know the silver breaks its way through 50 and continues to maraud up to that sort of hundred $100 level um simply due to the media attention that would would um come into the silver market. You know, you're going to have people who haven't even heard about silver in their lives, have completely forgot that it was even an investment, didn't even know you could invest in it, and the generalists are just going to pile in. And and silver is such a tidy market relative to gold. You know, I think the market cap silver is like 20 billion um the silver market compared to gold, which is, you know, multiples more than that. So it wouldn't take a lot for, you know, think about all the the money sitting in money markets right now. You know, I saw at the start the other day that it had been revised to to from 5 trillion to 7 trillion. If if a tiny percentage of that makes it way into the silver market, there's going to be these um disproportionately large returns and as we know the the London market right now is a choke point. you've got like um very very low levels of physical silver in the in the LBMA inventories. A lot of that went to across the B across the the Atlantic to the US uh earlier this year. Uh but I really do believe that those those um inventories could continue to be drained and when the journalists come in that that will be the the the straw that breaks the camel's back if you like. So big implications for the silver price, but for the silver companies as well. And I'm wondering if we can take a look over at the silver stocks. Of course, people typically look at them because they want to see them outperform silver itself. So I'm curious what you're seeing so far from silver companies in terms of their performance compared to silver and where you're focusing right now among the companies. Yeah. So, uh, I write for the Peter Kraut and and we work on the the silver companies, uh, for the silver advisor service that we provide. Um, so, essentially, I'm I'm very happy with where we're at at the moment. I do I do believe that, you know, a lot of us are maybe 150% 200% up. And that can be very tempting to look at those gains and think, you know what, I'm going to take some gains. I'm going to I'm going to trim, you know, I'm going to take a third of my profits, maybe even half. I may even sell the whole thing. I I'm not going to be doing that because I see the the long-term um the long-term rewards of this this silver bull market. Yes, there will be corrections. Jeff Clark, one of our colleagues as well, pointed out in his recent uh speech at myth that sometimes these corrections can be up to 20% intra bull market, you know, in the silver m silver and gold mining stocks. So, up to now, we've we've kind of seen maybe 5% corrections, maybe 7% corrections, depending on which stocks you're looking at. But there's probably going to be more of that. And if if that's not what you like, if you don't have the stomach for that, then then maybe this this industry isn't for you. But when you understand the fundamentals, when you understand that these companies um have paid down a lot of their debt and they're in a better financially position financial position than they were in previous years. When you consider the quality of the management teams that are out there, you consider that uh mergers and acquisitions are picking up finally again and and we're having sort of record financing months such as we did last month um for for mining and gold and silver miners. I I think we're in an excellent position and and you know it's really depends on your risk tolerance as to whether you want to take profits now or hold on for the ride. But in my opinion, the ride's going to continue for you know one or two years at least. And it also I think depends where it depends on yourself where you want to focus in terms of the cont companies the bigger ones or the smaller ones. Where do you see the most potential at this point in terms of share price gains? >> I I think obviously the the highest potential and the highest risk simultaneously lies in the exploration place. um depending on whether you come in at it from a wealth preservation perspective or or uh a speculation perspective, you're going to have a different uh perspective. Um I do believe that as a young guy, you know, I'm 24 years old uh getting on 25. Um I do believe that what do I have to lose, you know, to to speculate in these exploration companies. So I've got a longer time horizon, so my risk tolerance is higher. you know, if I were an older person, maybe 70, you know, 75 years old, I'd be thinking more about wealth preservation. I'd be thinking more about royalty companies, and I'd be thinking about quality, um, that would would allow me to maybe have a dividend from my for my pension, from retirement, your IRA, whatever. So, it depends, but for me, I'm I'm looking at the exploration companies. Um, you know, I think the opportunities below uh 500 million market cap are excellent. Obviously, high risk, so be careful. Uh but if that's what you're interested in, we we cover the best uh for the silver advisor on our service. So uh please check that out. >> Okay, very very well put there. And we've talked about silver. We want to take a look at the other precious metals as well. And where I wanted to move over is platinum. So this is another one that we talked about a few months ago during that other conversation that we had. And you're mentioning the potential that you were seeing there. It's another one that has been in deficit for years and we've seen the price really moving again since that last conversation. So I'm wondering if you can start by reviewing what is behind this move in platinum where it feels like it's been building for quite some time. >> Yeah, I know it's one of my favorite favorite stories I suppose in the commodities over the last few years. Many people benefit from the uranium bull. Um many people got in on gold really early, me included. Uh, but platinum was one that at the Morgan report we we called when it was at $950 and we're very proud of that. It's now $1,600. So, we can't say that it's the, you know, the stone cold bargain that it was at that price, but I do believe it's good value. And one of the reasons I believe that is because of the exa existing supply deficit as you point out Charlotte. Um, and and actually that is uh being exacerbated at this point in time. Um, specifically it was about 968,000 ounces last year, which is about 15% of the annual mine production. And and many of those demand drivers, you know, um, you know, they're kind of ancillary like electronics, dentistry, um, things that you, you know, wouldn't really expect. But the main one is catalytic converters from the automotive industry. And that's responsible for about 43% of the total demand. And uh to quote the the great rig rule, he said that the amount of platinum used in a catalytic converter is tiny compared to the overall vehicle price, just a couple hundred in a car uh costing well over $150,000. So that kind of price inelasticity means that even if platinum prices were to double, it would barely move the needle on the final vehicle price, which is why that demand category is so solid. So in in the Catholic to convert demand segment, platinum kind of has a price flaw. Um but actually what what's interesting, Charlotte, is that jewelry demand, particularly from China, has been the big demand driver in in the price rise in in of late. And um I think if I remember correctly, it was 151% yearonear uh that fabrication has increased uh in China's platinum jewelry industry. Um, and that's been helped by the relatively expensive gold prices relative to platinum. Um, and and ultimately those those two demand drivers of jewelry combined uh combined with the catalytic converters are coming together converging to to exploit a dwindling supply and 70% of that platinum supply is located in South Africa. Uh everybody knows that in South Africa they've had problems with load shedding in recent years which is basically due to a dependence on their dilapidated um coal powered um uh power grid and production in South Africa of platinum was fallen about 15% from its peak in 2021. it fell year on year last year as well. And so that combination of um you know an insecure energy supply and also the corruption also the crime also uh the high levels of bureaucracy in South Africa is making it quite difficult really and and the interest in platinum isn't hasn't been you know historically strong and now we're seeing the effects of that in the supply which is being exploited by the demand. So supply demand is is excellent and and also as I'll get into later um you know it's historically undervalued relative to gold platinum as well. >> Right. This is where I was hoping you would go with this. I was wondering if you could give some context on the platinum price because of course this year we look at it and it feels like it's made a really big move but from a historical perspective it's it's lower than it has been before. Usually it's more comparable to gold. So, how how should we situate ourselves when we look at the platinum price? >> Yeah. So, basically through the 1990s before I was born and and the 2000s, you'd need at least 1 oz of gold to buy 1 oz of platinum. And at certain times, like in 2000, 2008, you'd even need 2 or 2.1 ounces of gold to buy 1 oz of platinum. Obviously, after gold's relentless rise to 3,800, I think even nearly 3,900 today, that dynamic has now flipped. Um, in other words, you'd need uh I think I think roughly 4/10 of an ounce of gold to buy 1 oz of platinum at today's price of 1,600. That's about right, isn't it? Um, so that's actually pretty close to the most undervalued platinum has been relative to gold for at least 35 years. uh and the exact bottom in that platinum gold ratio uh came in April of this year around 0.28 now at 0.4 for so it's still a lot of value considering that it's been you know up at 2.1 at its peak and averaging you know one at least um so if you're thinking if gold stays at these levels which I do believe it will like as part as as part of this high level consolidation that I think we will see because every drop every dip in gold institutions are buying ETF holders are buying it it's it's the the most robust bull market I think we've seen since the 70s um so with All that in mind, you think that platinum's rel relative valuation to gold is actually very very cheap even after the 72% year-to- date rise this year. So that's very exciting as a platinum investor myself. >> Yes, I think those ratios really help to give some context on where where we're actually at compared to history. And so I think that people are definitely now seeing the case for platinum and they wonder all right how do I get exposure from the picture you're painting of the South African miners sounds like maybe that might not be the direction to go and I know there's kind of limited companies outside of South Africa they're doing platinum. So is it is it safest or best to just look at the metal or how are you approaching it? I I think there are there are very few and far between quality platinum miners or um even juniors. There's very very few juniors even less outside of South Africa and Russia which is where the majority of the of the supply is located. Um I do have a have investment personally full disclosure in uh in Still Water Critical Minerals which are based up in Montana. Um they've got a PGM complex with a lot of nickel as well in there. um which is adjacent to to uh Sivven Stillwaters project. It's part of the same sort of spin-off but separate companies. Um so that's one of the options. Um outside of that there's there's a couple. There's one in Brazil um that I that I own um Bravo Mining um which were actually also I believe at the at the event uh Rick's event in in Bocaraton that we both were there at. Um so there are a few but for me South Africa and also Russia for obvious reasons due to the war are outbounds so you're really kind of um you're very hardressed to find platinum names in that sense I think you know always good to have some physical of course you know I would say silver and gold first to get your initial positions in there um but but platinum definitely as a speculation and as as an undervalued metal great to hold physically you might consider some ETFs. Um, I think there's a Sprat one. I don't own it personally, but I'm pretty sure there's a Sprat one and maybe an Abedine one as well. Um, might be wrong on that, but there's those options and there's those those companies that I mentioned. That's personally what I'm invested in, which is of course not a recommendation. >> Okay. So, so we've got options. If we want to look at platinum, you can go in a variety of different directions. All right. So, we've looked at silver and platinum. I we're getting to the end, but before I let you go, I do want to touch on gold at least. And there's a reason that we've saved it for last. We're mentioning before we turn the camera on that gold is it's not your most favorite precious metal right now. So maybe before I let you go, you can talk a little bit about why that is, where where you place gold right now, and your your outlook there. >> Yeah, I mean, I still think of the thing, show I I'm not bearish on gold at this point. I'm just kind of I'm almost exhausted from how long that this bull market is going on. I think we all are. We're all kind of maybe slightly concerned at how quickly and how intensely the gold price is rising. I still do think as we wrote for the sound money report, I wrote an article that about a month ago that said kind of gold is is still could be argued as undervalued. And I still stand by that when when you're looking at things like the monetary base, right? And the monetary base um has expanded um I think it was in 1980 it was 157 billion US and today it's expanded to 5.74 trillion and that's 3556%. Now gold in that time was somewhere around 350% increase. Um, so when you think about the extent of that increase relative to gold, you could even make the argument that gold's going to go further. And we're now approaching that round number of $4,000. You've got all this geopolitical uncertainty. You've got an absence of monetary stability with the with the dollar's continued demise. And it's getting quite concerning now how quickly it's it's falling. You've got policies in in the United States with Trump who inherently needs a weaker US dollar to to make the US exports more attractive on the global stage. You know, he is willing on the the Fed chair to cut rates which will initiate further weakness into the US dollar. So actually a lot of this gold price going up business is the US dollar going down. And when you look at what Russia and China are doing with their um shows of strength at these conferences in the world where they you know show all their military equipment which by the way looks very very advanced compared to what we're seeing in the west. You know, there's a lot of reasons why investors are are tuning into gold. And I don't think that central banks, you know, a lot of that central bank demand is is price inelastic. like platinum with the catalytic toic converters, the auto makers, central banks are also buying gold whatever whatever price it is because they know that it's going to hold its value as a store of value that's naturally scarce better than an infinitely printed paper piece of you know you fill in the blanks. >> Yeah, I think this is a sentiment I'm starting to see a little bit more often. The case for gold is of course still there, but you might want to be broadening your focus a little bit more when it comes to the precious metals. So really good way I think to start wrapping it up. And any any final thoughts you would leave investors with? It's clear that you have a lot of different places that you're working right now. Maybe you can also mention where we can find you. >> Sure. Um yeah, so I think the the overriding theme is that this is now time for performance gold. As we said in the in gold trust report this year, this is time for silver, the mining stocks to take on the baton from gold and start outperforming as they already are doing. After that, it will be the broader commodities uh complex, the industrial metals. That might be a few months down the line, maybe years down the line, but right now it's silver's time to shine. It's platinum's time to shine, and gold's going to continue consolidating and rewarding investors for their for their um you know, smart thinking. Um where you can find me uh best place is on LinkedIn or on on X TJ Butler. Um I'm writing for various different publications right now. We just started a new one called the sound money report which you can find on Substack. That's with Roy Surfer. I'll also be writing the silver chapter this year in the in Goldie Trust report uh for the fourth year running that'll be now. Uh I also write about specifically silver stocks um you know juniors typically or developers below 1 billion uh market cap and that's for the silver advisor which you can find uh on the goldadvisor.com uh that's with Peter Kraut and Jeff Clark and I also write for the Morgan Report and I have been doing for three years and uh David Morgan of course a silver expert who I owe so much to an absolute genius of the silver market and um I'm still continuing to do that and uh Yeah, thanks for having me, Charlotte. I really appreciate this, >> of course. And we'll have to have you back soon to catch up on what's going on. I'll include links in the video description so people can sort out where to find you. And yes, thank you for coming on. Once again, I'm Charlotte Mloud with investing.com and this is Ted Butler. Thank you for watching. If you like this video, make sure you hit the like button and subscribe to our channel. We'd also love to hear your thoughts, so leave us a comment below. 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