Alasdair Macleod - Silver Drawdowns are Bypassing the Market (Opinion)

SBTV spoke with Alasdair Macleod, Head of Research at Goldmoney, about a banking crisis coming to the eurozone and why silver is an excellent play given the shenanigans of a rigged precious metals market.

Discussed in this interview:
01:17 Fed pausing rate hikes?
05:59 Disinflationary environment
11:06 European Central Bank conundrum
15:23 More bank failures ahead
19:57 Will China dump U.S. treasuries?
24:27 COMEX physical silver
28:52 COMEX withdrawals
32:06 Gold silver ratio movements

SBTV Interview Summary

In a recent video discussion, Alisdair Macleod, a renowned financial analyst with Goldmoney, shared his insights on the state of the global economy and the future of gold and silver. Here are the key points from the discussion:

Currency Exposure and Sterling

Alisdair Macleod began the discussion by exploring the exposure of currencies, particularly the Sterling, to rising interest rates. He suggested that the initial strength of Sterling due to rising gilt yields may be short-lived. The government's funding requirements and the state of the economy could lead to a depreciation of the Sterling, potentially testing the one pound to one dollar level.

European Central Bank and Rising Interest Rates

The conversation then shifted to the European Central Bank (ECB) and the impact of rising interest rates. Macleod noted that rising interest rates pose a similar problem for Eurozone commercial banks as they do for Silicon Valley Bank. He highlighted the potential for a significant financial crisis in the Eurozone due to the ECB and national central banks' deficits and the contraction of repo markets.

The Future of the Euro

Alisdair Macleod suggested that the difficulties in recapitalizing the ECB and national central banks could potentially lead to the demise of the Euro. He also anticipated more bank failures in the Eurozone due to the compression of credit margins as interest rates went below zero.

The Situation in the UK

Macleod discussed the situation in the UK, noting that the cost of funding the government's deficit is rising. He also mentioned that the Bank of England has a special purpose vehicle into which they put all their assets and is guaranteed by the treasury, a strategy not adopted by other central banks.

The Scenario of China Dumping Treasuries

Macleod discussed the potential scenario of China dumping treasuries and the impact it would have on the U.S. He suggested that the U.S. Treasury would have difficulty dealing with this situation and would have to hope it doesn't happen.

The Demand for Silver

Macleod discussed the demand for silver, noting that it is increasing due to its use in various industries like manufacturing solar panels and electric cars. He suggested that the demand for silver is going to outstrip available stocks very quickly.

The Gold-Silver Ratio

Macleod discussed the gold-silver ratio, suggesting that if gold goes up, silver goes up to slightly less than two times on average. He suggested that if one expects gold to go back up over $2,000, then silver could be a good investment.

The Importance of Gold and Silver

Alisdair Macleod concluded by emphasizing the importance of having some gold and silver liquidity in case of a fiat currency failure. He recommended storing gold and silver in secure vaults outside one's own country to keep it beyond the easy reach of the government.

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