The world of precious metals is witnessing consecutive earthquakes: Silver prices skyrocketed to a record of 53 USD/ounce, while gold prices were given by Mr. Josh Phair, CEO of Scottsdale mint (USA) - the leading gold and silver foundry in the US - in an interview with Kitco News at 30,000 USD, an unprecedented price in history.
Fcial Increase of Sinclair: The basis for the price of 30,000 USD
According to Mr. Phair, this forecast is based on the formula he calls Fair Sinclair Ratio, inspired by the gold trading legend Jim Mr. Gold Sinclair - who accurately predicted gold price peaks in 1980 and 2011.
The formula for calculating the gold price needed to fully guarantee the US debt held by foreign creditors. Based on the latest data from the US Treasury Department, foreign investors currently hold about $8.5 trillion in US public debt, while Washington's official gold reserves are only 261.5 million ounces.
This means that if gold is used to guarantee all that debt, gold prices must surpass 32,500 USD/ounce.
If we divide the US foreign debt by the amount of gold they announce, the figure is over 30,000 USD. This rate has reached twice in my lifetime - and there is no reason why it cannot happen again" - Mr. Phair predicted.
Silver crisis
Meanwhile, according to Mr. Phair, the silver crisis is a vivid example of the revaluation process, when the global supply chain is paralyzed from exploitation, refining to distribution. Silver lending interest rates have skyrocketed from 1-2% to over 100%/year. Refinery plants, which have been stuck with orders for 2-4 months, cannot bear capital costs and are forced to temporarily suspend operations.
The US currently has only two silver refineries that meet LBMA and COMEX standards, both of which are owned by Japan - showing a serious gap in domestic capacity.
The shortage of silver in London has forced traders to transport by air - an extremely expensive option. Bringing silver onto a plane from New York to London now costs about 75,000 USD, instead of a few cents like when taking a cruise ship, Mr. Phair revealed.
New geopolitical battle: "Two worlds" form
Josh Phair believes that this chaos is not only a market issue, but also a strategic step for the BRICS to build a financial system in parallel beyond the control of the US and the West.
The BRICS countries are quietly building gold warehouses in many places to create their own payment layer. The world is about to be divided into two systems, two alliances, two standards" - he commented.
The wave of speculation spreads globally
If before, only central banks and large organizations collected precious metals, now individual investors are also "pushing" into the race. In Japan, Tanaka - the country's largest gold retailer - had to stop selling small gold bars because it was " trop crowded with buying and selling".
When the government, banks and people rush in together, gold prices will explode and thats happening, Phair warned.
With every pillar of demand - from central banks, institutions, to retail - exploding at the same time, while material supply is almost paralyzed, Mr. Phair and analysts warn that the gold and silver markets are entering the most intense period of fluctuations in decades.
While the world gold price surpassed the 4,249 USD/ounce mark at 6:00 a.m. on October 18, domestic gold prices in Vietnam also continuously set new peaks. SJC gold bar price 152.5 - 153 million VND/tael (buy - sell). 9999 Bao Tin Minh Chau gold ring price 156.5 - 159.5 million VND/tael (buy - sell).
