Phil Carr
The Gold & Silver Club
This week, President Joe Biden unveiled his ambitious $2.3 trillion Green Energy and Infrastructure spending plan, calling it a “once in a generation” investment.
Fresh from passing a $1.9 trillion stimulus bill – President Biden has now turned his attention to a similarly massive plan of investment into infrastructure, which means that the U.S is going to need more commodities.
America requires Copper, Palladium, Cobalt, Lithium and rare earths for batteries. Above all, it needs Silver – and lots of it.
Silver will go into the electric vehicles that President Biden has said he’ll buy for the government fleet, in the charging stations to power them and in the cables connecting new wind turbines and solar farms to the grid.
Now, here's where things get interesting.
There is a lack of Silver around the world. There is not much Silver at any refineries and even getting your hands on physical Silver is difficult. In fact, Silver is now rarer than Gold, which means there is a risk of a real Silver squeeze this year.
Silver is a key component in President Biden’s ambitious Green Energy and Infrastructure plan. Based on our proprietary research, photovoltaic demand for Silver could exceed 3000 tonnes in 2021 – and that’s just the beginning.
As the U.S and other governments around the world pursue more aggressive Green Energy and Infrastructure policies to reach net-zero carbon emissions by 2050 or sooner – this alone will continue to be a major driver of Silver demand for years to come.
Where are prices heading next? Watch The Commodity Report now, for my latest price forecasts and predictions:
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EUR/USD treads water just above 1.0400 post-US data
Another sign of the good health of the US economy came in response to firm flash US Manufacturing and Services PMIs, which in turn reinforced further the already strong performance of the US Dollar, relegating EUR/USD to the 1.0400 neighbourhood on Friday.
GBP/USD remains depressed near 1.2520 on stronger Dollar
Poor results from the UK docket kept the British pound on the back foot on Thursday, hovering around the low-1.2500s in a context of generalized weakness in the risk-linked galaxy vs. another outstanding day in the Greenback.
Gold keeps the bid bias unchanged near $2,700
Persistent safe haven demand continues to prop up the march north in Gold prices so far on Friday, hitting new two-week tops past the key $2,700 mark per troy ounce despite extra strength in the Greenback and mixed US yields.
Geopolitics back on the radar
Rising tensions between Russia and Ukraine caused renewed unease in the markets this week. Putin signed an amendment to Russian nuclear doctrine, which allows Russia to use nuclear weapons for retaliating against strikes carried out with conventional weapons.
Eurozone PMI sounds the alarm about growth once more
The composite PMI dropped from 50 to 48.1, once more stressing growth concerns for the eurozone. Hard data has actually come in better than expected recently – so ahead of the December meeting, the ECB has to figure out whether this is the PMI crying wolf or whether it should take this signal seriously. We think it’s the latter.
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