Trey Reik’s Silver Masterclass: Why Silver Could Surge to $100 as Gold Breaks New Highs
Summary
Market Outlook: Trey Reik discusses the potential for silver prices to surge to $100 per ounce if the $50 barrier is broken, driven by both industrial and investment demand.
Industrial Demand: Silver's unique properties, such as high electrical and thermal conductivity, make it essential for industrial applications, including photovoltaic cells and AI infrastructure, which are expected to drive future demand.
Supply and Demand Dynamics: The silver market is experiencing a supply-demand deficit due to steady mining output and increasing industrial demand, tightening the market and supporting higher prices.
Investment Demand: Silver bull markets are largely driven by investment demand, with recent increases in ETF holdings indicating a potential upswing in silver prices.
Comparison with Gold: While gold is more established as a monetary metal due to its rarity and density, silver's industrial applications and smaller market size make it more volatile and potentially more rewarding during bull markets.
Equity Opportunities: The limited number of primary silver miners presents unique investment opportunities, especially in explorers, developers, and emerging producers, which are highlighted at the upcoming silver conference.
Fed Policy Impact: Historical data shows that silver equities tend to outperform following Fed pivots to an easing posture, suggesting potential gains as the current rate-cutting cycle progresses.
Transcript
If we break the $50 barrier, which was the, you know, all-time high recently, that we're heading much higher, say to 100 bucks an ounce. Hello everyone and welcome to Wealthian's special webinar on silver with the one of the most fascinating and misunderstood metals in the world. I'm Mario, the channel's producer, and I'm joined today by Trey Reich. Trey has spent decades analyzing the precious metals markets, and today we're going to unpack the silver story, how it's used, what drives its price, and why many investors believe silver's best days may still be ahead. >> Trey, how are you doing? >> Super. >> Great to >> It's great to host again. It's great to uh talk about silver this time. So, uh, just before we dive in, trade, as uh, you know, we'll be shining the spotlight on silver this month with special content such as this webinar, but there's something extra special that we're doing this month. Wealth unit and SCP resource finance are co-hosting a global silver conference in Toronto. And Trey, I'd like you to tell the viewers more about it and how they can go if that's okay. >> Certainly. Well, in terms of how to attend, we'd love to have folks in person or virtually, uh, the best way to get information about the conference is to click on the links in the description below. Uh, the conference will be at the Shangrila Hotel in Toronto on Thursday the 23rd. And I think we've assembled pretty much the cream of the crop in the silver industry on our agenda. were led by uh Mr. Silver himself, Eric Spratt, who will give the keynote. We have Maria Smnova, uh Sprat's Silver Lady, if I can be so formal, uh giving the lunchtime speech and uh we have Pan-American and First Majestic and down the line through uh 14 total silver presenters. Um, so I if you're interested in silver, there's really not nothing like this. There's no other dedicated silver conference of which I'm aware on the sell side anywhere. Um, and so it's a particularly, you know, pregnant time with silver, I think, trading over 48 today if I'm not mistaken. Um, it's going up so fast I can't keep track of it. So, uh, but this is this is an event not to be missed by anyone who's interested in silver, learning more about silver, learning more about companies in the silver industry, and there's not that many of them. Uh, so please take a look uh in the description below and uh get signed up either virtually or in person. >> Fantastic. And as viewers will surely learn from today's webinar and the special silver guests that we're having over the next few weeks, it's it's a great time to get to know more about the metal and the companies that produce silver. Before we start, also if you want to join in person, uh you will need to join our accredited investors list. And once you do that, we also have something special. Trey prepared a really really great report on silver and its outlook. You'll get that for free if you sign up uh to our accredited investors list. So with that trade, let's get started. People often mention gold and silver together like you know oil and gas or even salt and pepper. Do you think that's an accurate way to think about these two metals? >> It's a great question and a great place to get started. There are a lot of similarities between gold and silver. Um, they're both malleable. They're both ductal, they're both lustrous, and they're both non-corrosive. So, that makes both gold and silver uh ideal for jewelry and artifacts, which I think, you know, gets a lot of attention. But below that, I would make the case, and I may be alone in uh pointing this out, but I think the differences between silver and gold outweigh the similarities. And I think I could point to four, you know, different categories of how silver and gold are very different. So the first is just rarity. So uh gold is 18 times more rare in the silver uh than silver in the earth's crust. Um gold appears at four parts per billion and silver appears at 75 parts per billion. Uh and the second is density. So the density of gold is more than twice the density of silver 19.2 2 g per cubic centimeter versus say 9.3 g per cubic se cimeter. Now why is that important? Well, if you combine rarity with density, it makes gold the ideal uh metal for monetary reserves. So if central bank's going to have a monetary reserve and you have one metal that's uh 18 times more rare and twice as dense, obviously that's going to win, you know, the pendulum between what makes a good reserve asset. And so if you take the 200 and as as an example of this, a very graphic example, if you take the 216,000 tons of gold that have been mined in history all the way back to say the Egyptian pharaoh etc. uh 216,000 >> 216,000 tons uh and its current value would be about 27 trillion. It would all fit on one cubic tennis court. >> Wow. >> So we have a a slide here sort of demonstrating that. But um it it is amazing that all the gold in the world in museums, in central banks, on fingers, round necks, in teeth, all the gold in the world would fit on one cubic tennis court. So that's what makes gold, you know, a better monetary metal from a central bank perspective than silver. And then you know the third difference is the fact that silver's atomic structure which is based on a deoized 5s veence electron at top its 4d orbital shell uh gives silver some atomic characteristics that are very unique. It's the highest electrical conductivity. It's the highest thermal conductivity and it's the highest reflexivity of any metal. So this makes silver the ideal metal for lots of industrial applications from you know printed circuit boards to connection points and a million uses in industrial uses of and especially photovoltaic cells in solar panels you know recently. So therefore because of silver's industrial applications 59% of silver demand is industrial in nature. And what that leads to is the final difference which is because 59% of silver's applications are industrial. A lot of silver is consumed ever to be regained in the above ground stock. Whereas gold, because it's much higher priced and used in fewer industrial applications, most of the gold that's ever been mined is still around. So this leads to a big difference between silver and gold, which I think is commonly uh misunderstood, which is the above ground stock. So if you take that 216,000 tons that I mentioned, you know, that have been mined in history and we assume say 45% is in jewelry and artifacts, what's left is still around 15 trillion dollars worth of gold. But if we take the and and by the way, gold only melts at like 1948 degrees Fahrenheit and only two really aggressive acids acids if mixed together can dissolve it. So it's pretty immutable. U but if you look at that above ground stock of you know 27 trillion you take away 45 trillion that leaves 15 trillion. On the silver side of the equation, there's been about 1.7 million tons of silver mined, right, >> in the history of of the earth, which is 55.9 billion ounces. But more than half of that has been consumed to industrial uses and then the vast majority of what's left is in the form of silverware and jewelry. And because it's lower priced and there's a high sentimental value, it's unlikely to come back, you know, to the above ground stock for a freely traded investment asset. So that means you're comparing $15 trillion uh worth of gold in the above ground stock to something like six billion ounces of silver which would be 285 million >> in the value of the above ground stock which means the above ground stock of silver versus gold is about 2%. So those are the big four differences. Uh and it's why gold makes, you know, a much more attractive monetary metal than silver. >> It looks like silver is one of those metals that there's going to be a lot of industrial demand for much more than there has in the past again because of AI, EVs, and uh the use of as you were just saying microchips and all that infrastructure. So, can you walk us through this the the various industrial uses of silver and perhaps also like the traditional ones and now these ones that I was just mentioning? >> Sure. Well, way back when, you know, most of silver industrially was used in photography. But now that, you know, film and printing on paper have been replaced by digital uses, the photography use has gone down to almost nothing. And then there was, you know, it was basically solar panels. I mean, industrial use of silver in 2024 was 680 million ounces. >> Mhm. uh in a total demand of you know 1.2 billion ounces. Um that was up 33% from 2020 and the fastest growing segment are definitely photovalttaic cells for solar power. Uh that was 198 million ounces in 2024 which was up 140% since 2020. So obviously photovoltaic cells and solar panels are the prime driver of the increase in industrial demand. Now a lot of people will extrapolate that forever. I think a more logical way to look at it is after 10 years of really steep adoption I think photovalttaic cells and solar panels are due for a plateauing of demand. But what's interesting is AI uh infrastructure which we all read about you know ad nauseium in the press every day in terms of trillions and trillions of dollars >> that are going to be you know focused on silver demand excuse me focused on AI there are a lot of components of that infrastructure connection points etc that will be uh best utilized by silver um So um the other components of silvery silver demand are jewelry at like 28 million ounces >> and coin and bar demand is like 190 million ounces. Uh but you know my view is that the AI demands for silver are going to replace the photo voltaic demands which are likely to plateau over the next several years. the sum total I think will be a a steady increase in industrial demand. >> So So it sounds like there's going to be a lot of demand for industrial use in the future and as I'm sure we'll talk about also a lot of demand from investors into the silver. So that tells you quite a lot I would say. >> Um so I want to ask you uh this surge in industrial use has it affected the supply and demand? you know the balance between supply and demand in in the silver market itself >> 100% because uh silver supply in terms of mining and reclamation has been fairly steady. In fact, mining production uh in 2024 was 820 million ounces, which was very similar to the level first reached 13 years ago uh in 2013 uh at like 823 million ounces. So, silver supply has been very steady uh while this industrial demand has increased. And what that's led to is a supply demand deficit. So uh in the past four years uh ending in 2024 that supply demand deficit was about 678 million ounces and the estimates for this year while it's not concluded are for a deficit of about 117 million ounces. So together that's an 800 million ounce deficit in the supply demand equation for silver over the past 5 years. So um that's certainly tightened things up and given a floor to the silver price. >> Trey, how elastic or inelastic is the supply and demand for silver? >> Yeah. And for people that don't know those terms, because they're terms from uh economics, it's basically how how sensitive the um supply or demand of something is relative to the price changing. >> So this is a very interesting question about silver and its composition, you know, both metallergically and in the earth's crust, etc. But I think uh most folks don't recognize the fact that silver is primarily produced as a byproduct metal. >> Oh, >> so if we look at 2024 total mine production, for example, primary silver mines, meaning mines that primarily mine silver, was about 28% of the total. But the other uh amount of production was accounted for lead zinc mines about 29% uh copper mines about 27% and gold about 16%. >> So three4s of the silver that's produced on an annual basis is produced at mines that are primarily producing some other metal. >> Right? >> So you might say, "So what?" Well, the answer is that has sort of three implications. Number one, when well, first of all, most of the silver that's mined in the world is mined at big meggaap multimetal, you know, industrials like BHP, Bellatin, etc., and Riotinto. So, uh, when companies like that look at their silver production, they're not too concerned about supply or demand or the price. It's it's sort of a rounding error. So silver gets uh sort of a lack of attention at the boardroom level on uh you know increasing production for future years. The second effect is exploration budgets. So if silver to one of these big cap, you know, multim miners, uh, is a very small percentage, they're very unlikely, uh, to direct a high percentage of their exploration budget to silver. Um, and you can see that in the numbers over the past decade. S&P global, you know, estimates research buzz or exploration budgets for silver. uh and they're sort of in the 500 uh billion million dollar range versus billions and billions for for copper and gold, >> right? >> Um and the third uh implication is that there's not a lot of investment options for investing in silver on an equity basis because it's a byproduct of other companies, other metals >> and it this is in part because silver is much more abundant than gold. So if you want to go mine copper as your main line of business, you just end up finding it. >> Well, it's it's more that silver only appears in metallurgical deposits where it's a it's a minority. So there's very few deposits in the world that are primarily silver >> concentrated with silver deposits. >> Right. >> Oh, I see. That's very interesting. Okay. So let's talk about what I think investors want to hear and uh that's price. Can you tell me what are the biggest factors that investors should understand as to what actually moves the price of silver? >> So this is very important. you see uh a lot of press attention, Wall Street attention to industrial demand, things like photovoltaic cells and that's all important in establishing a floor for silver demand. >> But what really moves silver, you know, a bull market in silver is investment demand. And anyone who's really attuned to silver markets will tell you, you know, silver bull markets rest almost entirely on that differential and industrial demand. Uh because the silver market is very tiny as we talked about earlier. So the amount of available above ground stock of silver for investment is low. The above ground stock of silver miners is very low. Uh so when you get you know an upswing in investment demand that's what always drives silver bull markets and one way to follow that as an example in terms of where we are now is ETF demand. So, we have a chart here on total demand for silver ounces in ETF funds followed by Bloomberg. And I guess since I don't know 4 months ago, the upswing in ounces owned by silver ETFs is about 132 million ounces or 19%. Um, if we look at that in comparison to the last big upswing in silver ounces by ETFs, which was January 2020 to February 2021, uh, the dem the inflow of silver ounces was significantly higher at 423 million ounces or 70%. So my point here is that it measured by ETF demand now that the investment demand cycle has started with silver I think we have a lot further to run >> right so sounds like the price of silver is very sensitive to that extra demand from investors >> 100% and again I can't stress enough that the big difference between silver and gold markets is size you know the silver m market market is tiny. So once this gets going, you know, the impacts on price are much larger than the impacts, >> right? >> Yeah. >> So, uh, speaking of silver as an investment, just a quick note, if you're interested in owning physical gold or silver, our sister company, Hardass Assets Alliance, makes it simple and secure. You can learn more at hardassetsalliance.com. Once again, that's hardassallalliance.com. So, Trey, going back to the silver price, where do you see it going from here? >> Well, obviously that's, you know, uh the question, the $64,000 question. I'm not a technician by trade, but I will say that uh people who are very good at technical analysis suggest that silver's breakthrough of the $39 level was very important and those folks have predicted an acceleration and here we are at 48. So, they've been dead right and all hands on deck and the technical uh group suggest if we uh break the $50 barrier which was the you know all-time high recently um that we're heading much higher say to 100 bucks an ounce. All I can say is that based on fundamentals um if this gold bull market holds gold's about to break 4,000 today. we're nearing, you know, that that inflection point. If all of this continues and gold even holds near this $4,000 level, I would expect silver has a lot of that whipping catch up, which is, you know, traditional for silver markets uh to take the silver price significantly higher than 50. I think the $100 number is well within reach and say the next two years, >> right? And u we've had guests on, you've interviewed them, someone for example like Rick Ro who by the way will have for this special series on silver that talk about you know how silver is late to the precious metals bull market but when it does it's just explosive. So how do you think it will perform relative to gold over the next year or two? >> Yeah. So if as I said if the gold price first of all I have to be honest I think the gold price at 3950 or 30 where we are today I don't think there's any gold bull who would have predicted that at this point in the year we would be at this level >> given the fact that gold was up 27% last year. So >> uh we have to first say that you know we've all been following these fundamentals for decades. you know, anti- Fed, you know, credibility, anti- dollar sentiment, the high US deficit. These are arguments that I've, you know, talked about for at least 20 years, and they're all hitting these inflection points. And it's funny, as a gold investor, you sort of looking over your shoulder all the time, it's all starting to matter to the general public, to global stores of wealth. So the gold move especially in the last three months I think is surprising everyone. Uh silver as you mentioned always follows that lead. So even if gold just stays at current levels say 3900 3800 if we god forbid we break 4,000 in the next couple of months. Silver has a lot of sort of catchup in terms of historical >> relative performance. Uh so at this point in the cycle, silver is, you know, is certainly the place to be, >> right? We'll likely gain the most outperformance relative to relative to gold. So um let's shift to my favorite topic, which is equities. Mhm. >> And uh I've been expressing my views on gold for the last let's say 10 years investing in gold mines which I thought were cheap. But let's talk about silver equities. >> Mhm. >> Is the focus today. So um you'll tell viewers how big that universe is and what does it look like today. >> So uh partly as a result of things we've talked about earlier that being a byproduct metal >> etc. The question becomes how can I invest in silver equities? So we have a chart we'll put up here which is uh if you take the selective silver miners index um and you look at in those 38 companies that compose that silver miners index and you screen them for companies with market caps over 500 million and just 20% silver production percentage in revenues. In other words, a lot of the companies that are in that index have silver revenue percentages, believe it or not, that are below 20%. So, if we establish >> 20% as the minimum and 500 million as the market cap >> and we go to the selective silver miner index, which is the premier silver miners, how many companies do you think there are? >> Very few. >> 15. Yes. >> So you take these 15 companies, which is, you know, for a comp for an industry like this, I think that would surprise most people. There's 15 companies. And believe it or not, the average silver component in these 15 companies revenues is only 48%. So even in the 15 largest silver producers in the silver mining index, you still only have 48% revenue percentage in silver production. So I think that demonstrates this, you know, they're pretty rare animals. The total market cap of those 15 companies is 98 billion. I will point out that we did this last year in this exercise and the total market cap was about 40 billion. So >> they were even more uh I think rare back then. But even at 98 billion, the market cap of all the primary silver miners in the world is so low. Yeah. that if this precious metal push and the move out of you know fiat currencies and all of these uh you know macro topics that are driving the precious metal bull market stick around for the next two years you know that market cap could easily triple or quadruple >> tra and the speaking of valuations and I don't know if you know this but as you and I know very well gold miners have been cheap on a cash flow basis relative to they're all in sustaining costs and the price of gold and let's not even talk about today they're just gushing cash right >> are silver equities those very few silver pure plays cheap >> I believe that if the gold price which leads you know sort of leads this parade stays even where it is I think the silver price will rise guys. And I think the other thing is that with all miners, there's a bit of a lag. So for lots of reasons, we don't have to go into highgrading, just the natural progression of mining. As the average price sold in each quarter increases, there's about a one to two quarter lag. So the big increases in gold and silver have not yet been, you know, reflected in gold and silver equity earnings. And I think that's coming. And if you want to pin me down, I'll I'll be very clear. In the third and the fourth quarter, mark my words, you're going to see gold and silver earnings. And the third quarter is over. So you're going to see gold and silver earnings surprise many people, I think, to the upside. Uh and by the way, we were talking about s silver companies and how many there are and what's available to invest. It's important to recognize that last in the last year three of the big silver producers were acquired. So you had Gatos which was acquired by first maj first majestic silverrest was acquired by core and mag silver was acquired by paname. So, there's three of last year's stable that are gone. And the reason I bring this up is I think what the best place to look in the silver uh industry are explorers, developers, and emerging producers. And that's the sweet spot of what SCP Resource Finance, our Toronto partners, focus on. And that's why I think it's really important that viewers >> uh tune in to the upcoming silver conference on October 23rd because those companies uh that we're going to be presenting on and that SCP has picked because of their knowledge of the industry are really the upandcomers in the silver industry that require everybody's attention. I think those are the best opportunities in the silver space moving forward >> as an as an equity investor. That's that's fantastic. So reminding viewers uh you can join our credit investor list to find out how to attend in person to SCPs and wealth silver Google conference. And uh Trey, remember we're we're also going to do a virtual conference, a replay of all the conferences in person and also a few special and unique things and um this links and more info uh below in the description. Just want to mention everybody since we're talking about equities and investing in the stock market that you can get a free portfolio review with one of our trusted financial advisors at wealth.com forwardfree. Once again, that's wealth.comree. So, um, we're almost out of time, Trey, but I can't help but ask you again what expectations you have for silver mining stocks, these pure plays that we will learn a lot more about in the silver gold conference that we're doing with SCP. You know, do you see them outperforming the metal itself or is it just too early to tell? >> So, uh, we're going to end with one slide. which you're going to put up which is fairly full but it has a lot of detail on a relationship that I think everyone should pay attention to that's not commonly recognized and that's the relationship believe it or not between silver equities and Fed pivots to easing posture. So let's think about that for a minute. So in the past 20 years uh we've highlighted in this uh table the six Fed pivots towards easing posture that really stick out. The first was the internet crash. Second was GFC. Third was the yell and pause because of the Chinese reaction to her first rate increase. Uh little bit more complicated than the other ones. Then there was the PAL pivot uh in 2019 and then COVID which everybody remembers and then the most recent uh cycle which started with the September 2024 50 basis point Fed trade cut. So after all of these uh Fed pivots towards easing posture, it is interesting to note gold and gold equities outperformed the S&P. But uh we actually looked at this recently and were surprised to see that silver equities outperform gold equities by a wide margin. So not listing all of these different numbers, I will just point out that in the internet crash, you know, if you go uh a year out, 17 months out, the selective silver mining index was up 374%. And then 266, 239, 33 and 140. So a lot of numbers there which everyone can look out. But in the recent cycle, uh, since the Fed's September 2024 rate cut, the selective silver miner index is up 110%. And that's versus an S&P up 19, gold up 46, the GDM up 93, and silver itself up 53. And then we think about the fact that the Fed in September of this year just started sort of a new rate cutting cycle. >> Who knows where it will end up? So we have this current uh you know reversal Fed pivot towards easing posture and it's being reinforced with more rate cuts. And I would just say you know is this a coincidence? And I think if you look back on it, the reason this makes really really logical sense is that when the Fed is cutting that people get excited about economic growth, industrial uses, etc. At the same time, the monetary value of silver is kicking in. So I think it's no coincidence that after Fed rate cuts uh because of the combination of silver's industrial and monetary fundamentals, silver equities tend to outperform. So I think that bodess very well for say the next 12 months for sure. >> Super interesting. And because there's so few pure plays, I also think it's it's kind of easier to go and uh pick and choose potentially. >> Right. So this was fascinating Trey. Thank you so much. I learned quite a lot today from you as I always do. So u thank you very much for sharing your insights with us. >> Mario, thanks for having me. I always look forward to it. >> It's always a pleasure to host you, sir. And to our audience, thank you so much for joining us and we'll see you again next time. Take care. >> If you have any questions about how to navigate the current environment, Wealthon can help connect you with a vetted advisor to get a free portfolio review. Just click the link in the description below or head to wealthon.com/free. There's no obligation and it will just take a few minutes of your time. Again, that's wealthon.comfree. Thanks so much for joining us. We'll see you again next time. [Music]
Trey Reik’s Silver Masterclass: Why Silver Could Surge to $100 as Gold Breaks New Highs
Summary
Transcript
If we break the $50 barrier, which was the, you know, all-time high recently, that we're heading much higher, say to 100 bucks an ounce. Hello everyone and welcome to Wealthian's special webinar on silver with the one of the most fascinating and misunderstood metals in the world. I'm Mario, the channel's producer, and I'm joined today by Trey Reich. Trey has spent decades analyzing the precious metals markets, and today we're going to unpack the silver story, how it's used, what drives its price, and why many investors believe silver's best days may still be ahead. >> Trey, how are you doing? >> Super. >> Great to >> It's great to host again. It's great to uh talk about silver this time. So, uh, just before we dive in, trade, as uh, you know, we'll be shining the spotlight on silver this month with special content such as this webinar, but there's something extra special that we're doing this month. Wealth unit and SCP resource finance are co-hosting a global silver conference in Toronto. And Trey, I'd like you to tell the viewers more about it and how they can go if that's okay. >> Certainly. Well, in terms of how to attend, we'd love to have folks in person or virtually, uh, the best way to get information about the conference is to click on the links in the description below. Uh, the conference will be at the Shangrila Hotel in Toronto on Thursday the 23rd. And I think we've assembled pretty much the cream of the crop in the silver industry on our agenda. were led by uh Mr. Silver himself, Eric Spratt, who will give the keynote. We have Maria Smnova, uh Sprat's Silver Lady, if I can be so formal, uh giving the lunchtime speech and uh we have Pan-American and First Majestic and down the line through uh 14 total silver presenters. Um, so I if you're interested in silver, there's really not nothing like this. There's no other dedicated silver conference of which I'm aware on the sell side anywhere. Um, and so it's a particularly, you know, pregnant time with silver, I think, trading over 48 today if I'm not mistaken. Um, it's going up so fast I can't keep track of it. So, uh, but this is this is an event not to be missed by anyone who's interested in silver, learning more about silver, learning more about companies in the silver industry, and there's not that many of them. Uh, so please take a look uh in the description below and uh get signed up either virtually or in person. >> Fantastic. And as viewers will surely learn from today's webinar and the special silver guests that we're having over the next few weeks, it's it's a great time to get to know more about the metal and the companies that produce silver. Before we start, also if you want to join in person, uh you will need to join our accredited investors list. And once you do that, we also have something special. Trey prepared a really really great report on silver and its outlook. You'll get that for free if you sign up uh to our accredited investors list. So with that trade, let's get started. People often mention gold and silver together like you know oil and gas or even salt and pepper. Do you think that's an accurate way to think about these two metals? >> It's a great question and a great place to get started. There are a lot of similarities between gold and silver. Um, they're both malleable. They're both ductal, they're both lustrous, and they're both non-corrosive. So, that makes both gold and silver uh ideal for jewelry and artifacts, which I think, you know, gets a lot of attention. But below that, I would make the case, and I may be alone in uh pointing this out, but I think the differences between silver and gold outweigh the similarities. And I think I could point to four, you know, different categories of how silver and gold are very different. So the first is just rarity. So uh gold is 18 times more rare in the silver uh than silver in the earth's crust. Um gold appears at four parts per billion and silver appears at 75 parts per billion. Uh and the second is density. So the density of gold is more than twice the density of silver 19.2 2 g per cubic centimeter versus say 9.3 g per cubic se cimeter. Now why is that important? Well, if you combine rarity with density, it makes gold the ideal uh metal for monetary reserves. So if central bank's going to have a monetary reserve and you have one metal that's uh 18 times more rare and twice as dense, obviously that's going to win, you know, the pendulum between what makes a good reserve asset. And so if you take the 200 and as as an example of this, a very graphic example, if you take the 216,000 tons of gold that have been mined in history all the way back to say the Egyptian pharaoh etc. uh 216,000 >> 216,000 tons uh and its current value would be about 27 trillion. It would all fit on one cubic tennis court. >> Wow. >> So we have a a slide here sort of demonstrating that. But um it it is amazing that all the gold in the world in museums, in central banks, on fingers, round necks, in teeth, all the gold in the world would fit on one cubic tennis court. So that's what makes gold, you know, a better monetary metal from a central bank perspective than silver. And then you know the third difference is the fact that silver's atomic structure which is based on a deoized 5s veence electron at top its 4d orbital shell uh gives silver some atomic characteristics that are very unique. It's the highest electrical conductivity. It's the highest thermal conductivity and it's the highest reflexivity of any metal. So this makes silver the ideal metal for lots of industrial applications from you know printed circuit boards to connection points and a million uses in industrial uses of and especially photovoltaic cells in solar panels you know recently. So therefore because of silver's industrial applications 59% of silver demand is industrial in nature. And what that leads to is the final difference which is because 59% of silver's applications are industrial. A lot of silver is consumed ever to be regained in the above ground stock. Whereas gold, because it's much higher priced and used in fewer industrial applications, most of the gold that's ever been mined is still around. So this leads to a big difference between silver and gold, which I think is commonly uh misunderstood, which is the above ground stock. So if you take that 216,000 tons that I mentioned, you know, that have been mined in history and we assume say 45% is in jewelry and artifacts, what's left is still around 15 trillion dollars worth of gold. But if we take the and and by the way, gold only melts at like 1948 degrees Fahrenheit and only two really aggressive acids acids if mixed together can dissolve it. So it's pretty immutable. U but if you look at that above ground stock of you know 27 trillion you take away 45 trillion that leaves 15 trillion. On the silver side of the equation, there's been about 1.7 million tons of silver mined, right, >> in the history of of the earth, which is 55.9 billion ounces. But more than half of that has been consumed to industrial uses and then the vast majority of what's left is in the form of silverware and jewelry. And because it's lower priced and there's a high sentimental value, it's unlikely to come back, you know, to the above ground stock for a freely traded investment asset. So that means you're comparing $15 trillion uh worth of gold in the above ground stock to something like six billion ounces of silver which would be 285 million >> in the value of the above ground stock which means the above ground stock of silver versus gold is about 2%. So those are the big four differences. Uh and it's why gold makes, you know, a much more attractive monetary metal than silver. >> It looks like silver is one of those metals that there's going to be a lot of industrial demand for much more than there has in the past again because of AI, EVs, and uh the use of as you were just saying microchips and all that infrastructure. So, can you walk us through this the the various industrial uses of silver and perhaps also like the traditional ones and now these ones that I was just mentioning? >> Sure. Well, way back when, you know, most of silver industrially was used in photography. But now that, you know, film and printing on paper have been replaced by digital uses, the photography use has gone down to almost nothing. And then there was, you know, it was basically solar panels. I mean, industrial use of silver in 2024 was 680 million ounces. >> Mhm. uh in a total demand of you know 1.2 billion ounces. Um that was up 33% from 2020 and the fastest growing segment are definitely photovalttaic cells for solar power. Uh that was 198 million ounces in 2024 which was up 140% since 2020. So obviously photovoltaic cells and solar panels are the prime driver of the increase in industrial demand. Now a lot of people will extrapolate that forever. I think a more logical way to look at it is after 10 years of really steep adoption I think photovalttaic cells and solar panels are due for a plateauing of demand. But what's interesting is AI uh infrastructure which we all read about you know ad nauseium in the press every day in terms of trillions and trillions of dollars >> that are going to be you know focused on silver demand excuse me focused on AI there are a lot of components of that infrastructure connection points etc that will be uh best utilized by silver um So um the other components of silvery silver demand are jewelry at like 28 million ounces >> and coin and bar demand is like 190 million ounces. Uh but you know my view is that the AI demands for silver are going to replace the photo voltaic demands which are likely to plateau over the next several years. the sum total I think will be a a steady increase in industrial demand. >> So So it sounds like there's going to be a lot of demand for industrial use in the future and as I'm sure we'll talk about also a lot of demand from investors into the silver. So that tells you quite a lot I would say. >> Um so I want to ask you uh this surge in industrial use has it affected the supply and demand? you know the balance between supply and demand in in the silver market itself >> 100% because uh silver supply in terms of mining and reclamation has been fairly steady. In fact, mining production uh in 2024 was 820 million ounces, which was very similar to the level first reached 13 years ago uh in 2013 uh at like 823 million ounces. So, silver supply has been very steady uh while this industrial demand has increased. And what that's led to is a supply demand deficit. So uh in the past four years uh ending in 2024 that supply demand deficit was about 678 million ounces and the estimates for this year while it's not concluded are for a deficit of about 117 million ounces. So together that's an 800 million ounce deficit in the supply demand equation for silver over the past 5 years. So um that's certainly tightened things up and given a floor to the silver price. >> Trey, how elastic or inelastic is the supply and demand for silver? >> Yeah. And for people that don't know those terms, because they're terms from uh economics, it's basically how how sensitive the um supply or demand of something is relative to the price changing. >> So this is a very interesting question about silver and its composition, you know, both metallergically and in the earth's crust, etc. But I think uh most folks don't recognize the fact that silver is primarily produced as a byproduct metal. >> Oh, >> so if we look at 2024 total mine production, for example, primary silver mines, meaning mines that primarily mine silver, was about 28% of the total. But the other uh amount of production was accounted for lead zinc mines about 29% uh copper mines about 27% and gold about 16%. >> So three4s of the silver that's produced on an annual basis is produced at mines that are primarily producing some other metal. >> Right? >> So you might say, "So what?" Well, the answer is that has sort of three implications. Number one, when well, first of all, most of the silver that's mined in the world is mined at big meggaap multimetal, you know, industrials like BHP, Bellatin, etc., and Riotinto. So, uh, when companies like that look at their silver production, they're not too concerned about supply or demand or the price. It's it's sort of a rounding error. So silver gets uh sort of a lack of attention at the boardroom level on uh you know increasing production for future years. The second effect is exploration budgets. So if silver to one of these big cap, you know, multim miners, uh, is a very small percentage, they're very unlikely, uh, to direct a high percentage of their exploration budget to silver. Um, and you can see that in the numbers over the past decade. S&P global, you know, estimates research buzz or exploration budgets for silver. uh and they're sort of in the 500 uh billion million dollar range versus billions and billions for for copper and gold, >> right? >> Um and the third uh implication is that there's not a lot of investment options for investing in silver on an equity basis because it's a byproduct of other companies, other metals >> and it this is in part because silver is much more abundant than gold. So if you want to go mine copper as your main line of business, you just end up finding it. >> Well, it's it's more that silver only appears in metallurgical deposits where it's a it's a minority. So there's very few deposits in the world that are primarily silver >> concentrated with silver deposits. >> Right. >> Oh, I see. That's very interesting. Okay. So let's talk about what I think investors want to hear and uh that's price. Can you tell me what are the biggest factors that investors should understand as to what actually moves the price of silver? >> So this is very important. you see uh a lot of press attention, Wall Street attention to industrial demand, things like photovoltaic cells and that's all important in establishing a floor for silver demand. >> But what really moves silver, you know, a bull market in silver is investment demand. And anyone who's really attuned to silver markets will tell you, you know, silver bull markets rest almost entirely on that differential and industrial demand. Uh because the silver market is very tiny as we talked about earlier. So the amount of available above ground stock of silver for investment is low. The above ground stock of silver miners is very low. Uh so when you get you know an upswing in investment demand that's what always drives silver bull markets and one way to follow that as an example in terms of where we are now is ETF demand. So, we have a chart here on total demand for silver ounces in ETF funds followed by Bloomberg. And I guess since I don't know 4 months ago, the upswing in ounces owned by silver ETFs is about 132 million ounces or 19%. Um, if we look at that in comparison to the last big upswing in silver ounces by ETFs, which was January 2020 to February 2021, uh, the dem the inflow of silver ounces was significantly higher at 423 million ounces or 70%. So my point here is that it measured by ETF demand now that the investment demand cycle has started with silver I think we have a lot further to run >> right so sounds like the price of silver is very sensitive to that extra demand from investors >> 100% and again I can't stress enough that the big difference between silver and gold markets is size you know the silver m market market is tiny. So once this gets going, you know, the impacts on price are much larger than the impacts, >> right? >> Yeah. >> So, uh, speaking of silver as an investment, just a quick note, if you're interested in owning physical gold or silver, our sister company, Hardass Assets Alliance, makes it simple and secure. You can learn more at hardassetsalliance.com. Once again, that's hardassallalliance.com. So, Trey, going back to the silver price, where do you see it going from here? >> Well, obviously that's, you know, uh the question, the $64,000 question. I'm not a technician by trade, but I will say that uh people who are very good at technical analysis suggest that silver's breakthrough of the $39 level was very important and those folks have predicted an acceleration and here we are at 48. So, they've been dead right and all hands on deck and the technical uh group suggest if we uh break the $50 barrier which was the you know all-time high recently um that we're heading much higher say to 100 bucks an ounce. All I can say is that based on fundamentals um if this gold bull market holds gold's about to break 4,000 today. we're nearing, you know, that that inflection point. If all of this continues and gold even holds near this $4,000 level, I would expect silver has a lot of that whipping catch up, which is, you know, traditional for silver markets uh to take the silver price significantly higher than 50. I think the $100 number is well within reach and say the next two years, >> right? And u we've had guests on, you've interviewed them, someone for example like Rick Ro who by the way will have for this special series on silver that talk about you know how silver is late to the precious metals bull market but when it does it's just explosive. So how do you think it will perform relative to gold over the next year or two? >> Yeah. So if as I said if the gold price first of all I have to be honest I think the gold price at 3950 or 30 where we are today I don't think there's any gold bull who would have predicted that at this point in the year we would be at this level >> given the fact that gold was up 27% last year. So >> uh we have to first say that you know we've all been following these fundamentals for decades. you know, anti- Fed, you know, credibility, anti- dollar sentiment, the high US deficit. These are arguments that I've, you know, talked about for at least 20 years, and they're all hitting these inflection points. And it's funny, as a gold investor, you sort of looking over your shoulder all the time, it's all starting to matter to the general public, to global stores of wealth. So the gold move especially in the last three months I think is surprising everyone. Uh silver as you mentioned always follows that lead. So even if gold just stays at current levels say 3900 3800 if we god forbid we break 4,000 in the next couple of months. Silver has a lot of sort of catchup in terms of historical >> relative performance. Uh so at this point in the cycle, silver is, you know, is certainly the place to be, >> right? We'll likely gain the most outperformance relative to relative to gold. So um let's shift to my favorite topic, which is equities. Mhm. >> And uh I've been expressing my views on gold for the last let's say 10 years investing in gold mines which I thought were cheap. But let's talk about silver equities. >> Mhm. >> Is the focus today. So um you'll tell viewers how big that universe is and what does it look like today. >> So uh partly as a result of things we've talked about earlier that being a byproduct metal >> etc. The question becomes how can I invest in silver equities? So we have a chart we'll put up here which is uh if you take the selective silver miners index um and you look at in those 38 companies that compose that silver miners index and you screen them for companies with market caps over 500 million and just 20% silver production percentage in revenues. In other words, a lot of the companies that are in that index have silver revenue percentages, believe it or not, that are below 20%. So, if we establish >> 20% as the minimum and 500 million as the market cap >> and we go to the selective silver miner index, which is the premier silver miners, how many companies do you think there are? >> Very few. >> 15. Yes. >> So you take these 15 companies, which is, you know, for a comp for an industry like this, I think that would surprise most people. There's 15 companies. And believe it or not, the average silver component in these 15 companies revenues is only 48%. So even in the 15 largest silver producers in the silver mining index, you still only have 48% revenue percentage in silver production. So I think that demonstrates this, you know, they're pretty rare animals. The total market cap of those 15 companies is 98 billion. I will point out that we did this last year in this exercise and the total market cap was about 40 billion. So >> they were even more uh I think rare back then. But even at 98 billion, the market cap of all the primary silver miners in the world is so low. Yeah. that if this precious metal push and the move out of you know fiat currencies and all of these uh you know macro topics that are driving the precious metal bull market stick around for the next two years you know that market cap could easily triple or quadruple >> tra and the speaking of valuations and I don't know if you know this but as you and I know very well gold miners have been cheap on a cash flow basis relative to they're all in sustaining costs and the price of gold and let's not even talk about today they're just gushing cash right >> are silver equities those very few silver pure plays cheap >> I believe that if the gold price which leads you know sort of leads this parade stays even where it is I think the silver price will rise guys. And I think the other thing is that with all miners, there's a bit of a lag. So for lots of reasons, we don't have to go into highgrading, just the natural progression of mining. As the average price sold in each quarter increases, there's about a one to two quarter lag. So the big increases in gold and silver have not yet been, you know, reflected in gold and silver equity earnings. And I think that's coming. And if you want to pin me down, I'll I'll be very clear. In the third and the fourth quarter, mark my words, you're going to see gold and silver earnings. And the third quarter is over. So you're going to see gold and silver earnings surprise many people, I think, to the upside. Uh and by the way, we were talking about s silver companies and how many there are and what's available to invest. It's important to recognize that last in the last year three of the big silver producers were acquired. So you had Gatos which was acquired by first maj first majestic silverrest was acquired by core and mag silver was acquired by paname. So, there's three of last year's stable that are gone. And the reason I bring this up is I think what the best place to look in the silver uh industry are explorers, developers, and emerging producers. And that's the sweet spot of what SCP Resource Finance, our Toronto partners, focus on. And that's why I think it's really important that viewers >> uh tune in to the upcoming silver conference on October 23rd because those companies uh that we're going to be presenting on and that SCP has picked because of their knowledge of the industry are really the upandcomers in the silver industry that require everybody's attention. I think those are the best opportunities in the silver space moving forward >> as an as an equity investor. That's that's fantastic. So reminding viewers uh you can join our credit investor list to find out how to attend in person to SCPs and wealth silver Google conference. And uh Trey, remember we're we're also going to do a virtual conference, a replay of all the conferences in person and also a few special and unique things and um this links and more info uh below in the description. Just want to mention everybody since we're talking about equities and investing in the stock market that you can get a free portfolio review with one of our trusted financial advisors at wealth.com forwardfree. Once again, that's wealth.comree. So, um, we're almost out of time, Trey, but I can't help but ask you again what expectations you have for silver mining stocks, these pure plays that we will learn a lot more about in the silver gold conference that we're doing with SCP. You know, do you see them outperforming the metal itself or is it just too early to tell? >> So, uh, we're going to end with one slide. which you're going to put up which is fairly full but it has a lot of detail on a relationship that I think everyone should pay attention to that's not commonly recognized and that's the relationship believe it or not between silver equities and Fed pivots to easing posture. So let's think about that for a minute. So in the past 20 years uh we've highlighted in this uh table the six Fed pivots towards easing posture that really stick out. The first was the internet crash. Second was GFC. Third was the yell and pause because of the Chinese reaction to her first rate increase. Uh little bit more complicated than the other ones. Then there was the PAL pivot uh in 2019 and then COVID which everybody remembers and then the most recent uh cycle which started with the September 2024 50 basis point Fed trade cut. So after all of these uh Fed pivots towards easing posture, it is interesting to note gold and gold equities outperformed the S&P. But uh we actually looked at this recently and were surprised to see that silver equities outperform gold equities by a wide margin. So not listing all of these different numbers, I will just point out that in the internet crash, you know, if you go uh a year out, 17 months out, the selective silver mining index was up 374%. And then 266, 239, 33 and 140. So a lot of numbers there which everyone can look out. But in the recent cycle, uh, since the Fed's September 2024 rate cut, the selective silver miner index is up 110%. And that's versus an S&P up 19, gold up 46, the GDM up 93, and silver itself up 53. And then we think about the fact that the Fed in September of this year just started sort of a new rate cutting cycle. >> Who knows where it will end up? So we have this current uh you know reversal Fed pivot towards easing posture and it's being reinforced with more rate cuts. And I would just say you know is this a coincidence? And I think if you look back on it, the reason this makes really really logical sense is that when the Fed is cutting that people get excited about economic growth, industrial uses, etc. At the same time, the monetary value of silver is kicking in. So I think it's no coincidence that after Fed rate cuts uh because of the combination of silver's industrial and monetary fundamentals, silver equities tend to outperform. So I think that bodess very well for say the next 12 months for sure. >> Super interesting. And because there's so few pure plays, I also think it's it's kind of easier to go and uh pick and choose potentially. >> Right. So this was fascinating Trey. Thank you so much. I learned quite a lot today from you as I always do. So u thank you very much for sharing your insights with us. >> Mario, thanks for having me. I always look forward to it. >> It's always a pleasure to host you, sir. And to our audience, thank you so much for joining us and we'll see you again next time. Take care. >> If you have any questions about how to navigate the current environment, Wealthon can help connect you with a vetted advisor to get a free portfolio review. Just click the link in the description below or head to wealthon.com/free. There's no obligation and it will just take a few minutes of your time. Again, that's wealthon.comfree. Thanks so much for joining us. We'll see you again next time. [Music]