While physical silver investment demand experienced a pronounced decline this year, the volume is still much larger than the level prior to the 2008 U.S. Housing and Banking Crash. Investors frustrated by a silver market plagued with lousy sentiment and weak demand, may not realize that silver bar and coin demand is projected to be double what it was in 2007.
Thus, long-term precious metals investors continue to acquire silver on price dips while others may be selling out and placing their bets into the bubble stock market or cryptocurrencies. It’s not the larger precious metals investor who is worried about the short-term price, rather its the smaller investor.
Regardless, according to the Silver Institute’s 2017 Interim Report, global silver bar and coin demand are projected to fall to 130 million oz (Moz) in 2017 compared to 206 Moz last year. Even though physical silver investment demand will drop by 37% this year, it was still more than double the 62 Moz in 2007:
Furthermore, silver bar and coin demand in 2012 was only 29 Moz higher than the estimate for this year, but the price was nearly double to $30. Precious metals investors continued to purchase record amounts of silver bar and coins in 2013, 2014 and 2015 with the hope that prices would eventually start to head higher. However, the majority of the market’s funds continue to flow into STOCKS, BONDS, and REAL ESTATE.
Then after the election of President Trump to the Whitehouse, along with falling sentiment, investors pulled back on gold and silver investment purchases. From what I have heard through the grapevine, precious metals dealer sales this year are down about 40% across the board. And of course, the massive price increase in Bitcoin and the cryptocurrencies starting in March of this year funneled money away from the metals.
With the new rush into the Bitcoin mania market, several analysts have given up on precious metals and are now touting cryptocurrencies as the best place to be. In fact, some have stated that gold is no longer useful as a monetary instrument because cryptos will take over this role. Unfortunately, these analysts, just like the mainstream media counterparts, have simply forgotten about our terrible ENERGY PREDICAMENT we are facing.It’s almost as if the lure of $100,000 Bitcoin has totally destroyed their ability to understand that fundamentals still matter.