1/6 Here are my annual #PreciousMetals valuations I use to make decisions & my price projections for 2026, which may be helpful to you. They’re based on the principle that #money is #gold (natural money in contrast to man-made constructs of #banks and gov’ts based on #debt) while #silver is an industrial metal that can also be a gold-substitute b/c like gold, silver can be owned to preserve #PurchasingPower outside the banking system. Based on my estimates for 31 Dec 25 #gold & #FX reserves using IMF data, current Fair Value for #gold=$11,341/oz, using my Gold Money Index explained in:
amazon.com/Money-Bubble-J…
Money can be over-or-undervalued just like the value of investments in your portfolio. Data points on chart show gold overvalued in 1960s, 1974 & 1980, but undervalued since 1984. Though now at the smallest undervaluation since 1990, follow the same strategy I’ve recommended since founding goldmoney.com in 2001 - continue to accumulate physical gold by dollar-cost averaging until it again is overvalued, unless you need to spend this Purchasing Power you have saved. Otherwise hold it to spend or invest when gold again becomes overvalued. Valuations are moving targets based on how much central banks inflate national currencies. The Fair Value for gold on 31 Dec 2024 was $10,902. FV was exceeded in the 1974 and 1980 blow-off tops by 128% in 1974 and 162% in 1980. If the next top exceeds gold's FV by 145% (the average of the two previous tops) then $16,445. But that assumes FX reserves are unchanged, & they are likely to grow which would mean even higher prices at the next blow-off top. The #PreciousMetals are not in a #bubble b/c they are not overvalued. The bubble is the #dollar b/c it is masquerading as money but is only a questionable promise circulating as #currency b/c of rhetoric, propaganda & gov’t force (laws). 2/6 I use the Fair Value of #gold & the gold/silver ratio (currently 61:1) to calculate the FV of #silver, which has demand as an industrial metal & a gold-substitute. There is about 10X more silver than gold in the earth's crust & roughly 10X more silver than gold mined annually by weight, but their historic ratio is about 16oz silver to 1oz gold, not 10:1 as supply alone would suggest. The 16:1 ratio reflects the demand premium given to gold as a purely #monetary metal. Let's assume the ratio fluctuates in a range between 30 (the ratio at silver's 2011 price peak) & 20 to approach the historic ratio.
$11,341 / 30 =$378 per oz silver
$11,341 / 20 =$567 per oz silver
The Fair Value of silver therefore ranges between $378 & $567 based on gold’s FV. Time will tell whether these long-term targets will be achieved or even exceeded like they did in 1980 when the FV of gold was $325 (and way overvalued at its $850 peak). Silver back then nearly hit $50, which is a 17:1 ratio. At this ratio, silver’s FV in 1980 was $19 ($325/17), illustrating the extent of the then prevailing spec bubble led by the Hunt Bros. In contrast, rising silver prices now are being driven by demand for physical metal needed in solar, EVs, electronics, etc, not spec buying. A 16:1 ratio could again be achieved if silver’s #industrial demand continues & #monetary demand for silver grows, which it might do in a fiat #currency &/or #bank crisis.