World Bank Places Bets on This Precious Metal, And It's Not Gold

[BigDave84]

Interesting article about the World Bank's future predictions for 2018 and beyond. In their eyes, silver and gold likely to decline in real terms. Make of this what you will....

http://www.kitco.com/news/2017-10-27/World-Bank-Places-Bets-on-This-Precious-Metal-And-It-s-Not-Gold.html

[sixgun]

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Looking at current precious metals prices and based on the World Bank’s price forecasts, platinum is set to gain the most over the long term, as much as 64% by 2030. Meanwhile, gold and silver would decline by about 13% and 4%, respectively, within that same time frame.

So they genuinely think they can keep a lid on the price of silver. If we were to say the silver price is $16.80. If there were annual inflation of just 2% per year until 2030 (unlikely) to keep up with inflation silver's price in 2030 would be $21.73. The price would have to rise by roughly $5 or 30% to just keep up with a low projected inflation of 2%.

The current silver price is so undervalued it is mind boggling. We have had deficits in production since 2005. Silver is a commodity in very high demand. The silver in an iPhone costs about 25 cents. The likes of Apple and Samsung would pay $100/oz and not flinch. So despite this the boffins at the World Bank say silver's price will fall 4%. 

The report is worthless propaganda.  

[HawkHybrid]

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Gold prices are expected to drop 1 percent as anticipated U.S. interest rate hikes materialize

what happened dec 2015 after the first us rate hike?

 

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As for silver, the analysts are slightly more bullish than gold given the metal’s industrial price component.

do they not realise that when gold falls, silver falls faster?

 

HH

[BigDave84]

On 10/27/2017 at 21:51, sixgun said:

So they genuinely think they can keep a lid on the price of silver. If we were to say the silver price is $16.80. If there were annual inflation of just 2% per year until 2030 (unlikely) to keep up with inflation silver's price in 2030 would be $21.73. The price would have to rise by roughly $5 or 30% to just keep up with a low projected inflation of 2%.

The current silver price is so undervalued it is mind boggling. We have had deficits in production since 2005. Silver is a commodity in very high demand. The silver in an iPhone costs about 25 cents. The likes of Apple and Samsung would pay $100/oz and not flinch. So despite this the boffins at the World Bank say silver's price will fall 4%. 

The report is worthless propaganda.  

I agree. A pointless and worthless report. There are so many factors the full report did not address, which makes it look amateurish at best. It's a finger in the wind prediction at best, nothing more. The fact that they cannot predict world events that act as big drivers to the price of metals, puts their report in the waste bin.  Between now and 2030 who actually knows what will happen, unless you have the ability to control it (cue the conspiracy theorists) 

[sixgun]

On 10/27/2017 at 23:39, HawkHybrid said:

what happened dec 2015 after the first us rate hike?

Of course this marked what will be seen as the bottom of the preceding 4-5 year bear market in metals. Price took off until it got smacked down. i believe it actually marks the end of the time when the paper market had full control over price. In theory gold and silver as monetary investments should go down as interest rate rise. Bonds if they follow suit become a traditionally stable investment with an increased yield compared to metal with storage costs and no yield. 

On 10/27/2017 at 23:39, HawkHybrid said:

do they not realise that when gold falls, silver falls faster?

HH

They [apparently] do not seem to realise that silver is the more volatile partner of this pair. Indeed silver falls and rises faster and further than gold. Silver leads the way out of lows and is used to weigh on gold when price is being suppressed. So as you rightly note, their prediction silver will fall less than gold in the coming 13 years seems a little out.

As the OP has said the report does not cover a great deal, it is a finger in the wind. It is all wind in my book so i will give it two fingers. 

[MIP]

I would not bet too much on platinum’s role as a catalyst but still think it’s undervalued in terms of scarcity.

Not as much as it is silver, I would add.

[Sal]

Bonds rates cannot keep rising into anticipated inflation and gold and silver go down. Something has to give and it isn't going to be pretty.  What happens when the Fed rises 3-4 times next year (although Trump will hire a new fed that he thinks will keep a lid on rates) and the EU and Japan slow down on their bond buying?  Funny thing, Trump during his campaign was ranting about the low fed funds rate now I am guessing he is reversing course on his thinking. Trump brags about the stock market performance since he got elected but three rate increase next year will slow the market to a crawl at best. 6 months at best I give the US market before a major breakdown with a 20% correction depending on the independent (LOL) fed.

[Thelonerangershorse]

Given that almost all motor manufactures are now looking to drastically cut IC engines over the next 20 years, I wouldn't rely too much on the cat market.

[HawkHybrid]

the misinformation is that interest rate rises mean nothing.

interest rates have to rise a significant amount over the

rate of inflation for people to be tempted to sell gold and

buy bonds.

 

HH

[Martlet]

1 hour ago, Thelonerangershorse said:

Given that almost all motor manufactures are now looking to drastically cut IC engines over the next 20 years, I wouldn't rely too much on the cat market.

A few headline grabbing changes from manufacturers shouldn't deflect from the massive demand in India and China.  For infrastructure reasons alone, I expect to see hybrids as the way forward, not all electric.  Electricity grids cant support widespread use of batteries, if they solve problems of recharge time, they'll be limited by domestic  capacity for charging (current draw out of spec for cables).  And that's assuming mature, reliable grids, which aren't necessarily upto scratch even in western Europe and north America. 

[gkoogk]

if silver crashes to less than £11 an ounce im buying as much as I can to go with my 16 kilos lol