Tom welcomes Steve St. Angelo of the SRSrocco Report back on the show. Steve began buying silver in 2002, due to worries of fiat currency debasement and debt. As he delved deeper into the metal’s market, he started questioning certain aspects such as the cost of production, including energy, materials and labor. However, the economics profession largely disregards the energy cost factor and sees the growth as continuous. When energy scarcity occurs thought, the markets could drastically change. Most investors today are not prepared for it.

Thermodynamics is another key factor in energy consumption, as the laws of physics will come into play and create peaks. This typically results in a lack of real growth or maybe even civilizational decline due to exceeding the carrying capacity of resources. At present, unearthed silver mining’s all-in cost lies between $21 and $22, and around $1550 for gold mines. Institutions have moved to the ETF sector of the precious metals, and if we go through economic fragility and stagflation, more entities (such as Blackrock, the biggest holder in the PSLV), will likely become involved.

Within the last month, debt and money supply have commented the market jump in S&P 500 and the equity sector. Steve believes that it is likely to face a correction in the near future. In terms of energy, oil prices could increase later this year due to demand, and this will translate into inflation in food and consumer prices. Apart from that, geopolitical risks could only make matters worse. Recently, Europe managed to survive the winter with the fortunate help of green energy; nevertheless, their energy problems are still present and expensive. This winter could be different.

Time Stamp References:
0:00 – Introduction
0:42 – Precious Metals & Energy
2:57 – Assume a Can-Opener
4:46 – Metals Production Costs
6:09 – Future PM Scenarios
8:25 – Growth & Wealth Protection
11:13 – Silver Demand & Deficits
14:40 – Institutional Demand?
17:30 – Sentiment & Smart Money
20:24 – Defining Stagflation
22:10 – Recessions & Oil Price
24:34 – Energy Push Inflation
26:00 – Two Stages – Energy Cliff
29:05 – Europe & Gas Inventories
32:58 – Recessionary Impacts
38:53 – Rig Counts & Financing
41:28 – Estimated Oil Reserves?
44:48 – SPR Release Thoughts
47:40 – Commercial COT Positions
49:30 – Rates, EROI & Debt Servicing
51:33 – Blackrock & Potential Dynamics
53:20 – Concluding Thoughts

Talking Points From This Episode

• Institutional investors have surged into precious metals ETFs to shield wealth from financial fragility.
  
• Oil prices could increase, driving inflation in food and consumer prices.
  
• Rig counts and EROI could determine the success of energy reserves – with a potential energy cliff looming ahead.
  

Guest Links:
Website: https://srsroccoreport.com/
Twitter: https://twitter.com/SRSroccoReport
YouTube: https://www.youtube.com/channel/UCED7G7CZfqdSV9zttlr1M_g

Independent researcher Steve St. Angelo (SRSrocco) started to invest in precious metals in 2002. Later on, in 2008, he began researching areas of the gold and silver market that, curiously, most of the precious metal analyst community have left unexplored. These areas include how energy and the falling EROI – Energy Returned On Invested – stand to impact the mining industry, precious metals, paper assets, and the overall economy.

Steve considers studying the impacts of EROI one of the most important aspects of his energy research. For the past several years, he has written scholarly articles on some of the top precious metals and financial websites.

You can find many of Steve’s articles on noteworthy sites, such as GoldSeek-SilverSeek, Market Oracle, Financial Sense, GoldSilver.com, SilverDoctors, TFMetals Report, Outsiderclub, SGTreport, BrotherJohnF, Hartgeld, Der-Klare-Blick, PeakProsperity, SilverStrategies, DollarCollapse, FurtureMoneyTrends, Sharpspixley, FinancialSurvivalNetwork, PMBull, Deviantinvestor, PMBug, Wealthwire, and ZeroHedge.