Silver Storm Mining Ltd. (TSXV:SVRS)
Building the Next Latin American Silver Producer.
Willem Middelkoop, founder of the Commodity Discovery Fund and author of seven books on economics and financial markets, recently said that the commodities market is at a pivotal point in a major shift and could experience something similar to 2016.
The early months of 2016 marked the end of a long bear market in commodities, followed by a sudden and strong recovery in the market, which saw a break-up without any news and buyers returning to the market. There were a number of factors behind the 2016 recovery, including a stabilization in China’s economy and a rebound in the price of oil, which combined to drive a spike in commodity prices. Middelkoop believes that in 2024, a similar situation, coupled with shortages emerging in various markets, could herald the start of a new bull market era for commodities.
Precious metals markets, particularly gold and silver, are on the cusp of a major breakout, driven by factors such as a weakening dollar and geopolitical changes. Middelkoop points out that the first time gold prices broke above $2,000 began in 2019, when the Federal Reserve quickly cut interest rates, ending the 2015 tightening cycle. He believes a similar scenario is unfolding and that financial market turmoil will force central banks to end aggressive tightening sooner rather than later.
Going forward, once the gold price breaks above $2,100, all the hedge funds and speculators will flood the market, pushing the price even higher in the near term. He believes gold prices to break through a new record high this year is just a matter of time.
Middelkoop points out that the most important driver for gold is the increasing shift towards globalization. He explains that the world is rapidly moving towards a multi-polar system as the US dollar begins to weaken as a reserve currency. This can be seen in the fact that central banks around the world are hedging their bets by buying large amounts of gold. When central banks begin to flock to gold, it is a very powerful signal that there is serious distrust at the heart of the financial system.
He added that silver has serious problems on the supply and demand side, with virtually all of the ground stock in silver ETFs, and that the supply shortage is likely to intensify, especially if industrial demand is expected to recover. As a result, when the price of silver begins to rise, the pace and magnitude of the increase could be very, very impressive.
He also noted that Saudi Arabia’s decision to join the BRICS group marks a major shift in global economic alliances that could have an impact on the petrodollar system established in the 1970s. Saudi Arabia has been the anchor of the dollar system since the US petrodollar deal began in 1974. And now, Saudi Arabia has turned East. This move by Saudi Arabia could weaken the hegemony of the dollar, encourage multi-polarity in the world economy and potentially change the landscape of commodity trading and global economic policy.
If you’re interested in investing in commodities, you might want to keep an eye on this company: Silver Storm Mining Ltd. (TSXV:SVRS). Silver Storm Mining Ltd. holds advanced-stage silver projects located in Durango, Mexico. Golden Tag recently completed the acquisition of 100% of the La Parrilla Silver Mine Complex, a prolific operation which is comprised of a 2,000 tpd mill as well as five underground mines and an open pit that collectively produced 34.3 million silver-equivalent ounces between 2005 and 2019. The Company also holds a 100% interest in the San Diego Project, which is among the largest undeveloped silver assets in Mexico.
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