In a must-watch conversation, Brien Lundin and Chris Marcus discuss why silver is compelling, how to invest and what to know about manipulation.
As countries around the world take measures to stimulate their economies in the wake of COVID-19, interest in precious metals is increasing.
Investors typically gravitate towards gold and silver, but silver often comes with a warning attached — it’s known for being more volatile than gold, which can scare off those searching for a safe haven.
To help investors navigate the market, Brien Lundin, editor of Gold Newsletter, and Chris Marcus, founder of Arcadia Economics, recently joined the Investing News Network for a conversation on what investors should know about silver.
Overall, they agreed that despite the potential risks, silver is a metal with much potential upside. Watch the video above for their thoughts or click the links below to skip to specific points in the conversation:
- Part 1 — Why Silver is Compelling Right Now
- Part 2 — Silver Strategies for Investors
- Part 3 — What to Know About Silver Manipulation
“The real characteristic about silver is that it moves later than gold, typically, but it moves further than gold percentage-wise, and for the same reasons as gold. It’s kind of an easy, unexpiring option on the gold price — it offers you leverage to gold without a lot of the risk,” said Lundin, who is also the CEO of Jefferson Financial and the host of the New Orleans Investment Conference.
“It also moves more than gold on the downside, which is something that people need to know and recognize. But in a bull market environment like we’re in now, silver is a wonderful way to maximize and leverage the gains in gold,” he added.
Marcus, who is the author of the book “The Big Silver Short,” described the white metal as “an amplified version of gold,” and said he’s shocked that it’s still stuck where it is.
“When you look at the amount of paper that’s out there and the amount of metal that’s out there, it doesn’t add up. It’s tricky to know when that resolves, but there sure is a lot indicating that there’s some smoke coming out now,” he said.
“I look at what happened in 2011, that’s what the book gets into,” Marcus continued. “Either the price came down because they sold a lot of paper that they can’t back up, or maybe there’s another explanation. But if that is correct, to me US$50 (per ounce) seems like a floor whenever a free market comes back.”
Key quotes from Marcus and Lundin
“I understand why people think (silver manipulation is) a conspiracy theory — it’s hard to imagine that the markets have become this distorted. But you can just look at the (US Federal Reserve), (which) openly manipulates the bond market, calls it policy and hopes everyone plays along and pretends that’s normal” — Chris Marcus, Arcadia Economics
“Just about every market of that size is manipulated to some extent by short-term traders, by high-frequency traders. The monetary metals, gold and silver, have a special legacy or history of this kind of manipulation — gold was manipulated overtly and covertly by the US government a couple of times in the past … it’s all around us, and I don’t know how anybody can really look at this and say, ‘What’s so special about silver and gold that that’s the one market they’re not manipulating?
“I think the burden of proof is on people who argue that there is no manipulation” — Brien Lundin, Gold Newsletter, Jefferson Financial and the New Orleans Investment Conference
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Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.