Most Popular
1. Dow Max Drawdown Bear Stock Market 2022 - Accumulating Deviations from the Highs - 21st Feb 22
2.Putin Starts WW3 in Ukraine, Will Use Tactical Nuclear Weapons, China Prepares Taiwan Blitzkrieg - 28th Feb 22
3.World War 3 Phase 1 - Putin WINS Ukraine War! - 25th Feb 22
5.Will There Be A 2024 US Presidential Election? - 3rd Mar 22
6.Gold and SIlver, Precious Metals Sector Is at a Terrific Buy Spot - 6th Feb 22
7.Why Putin Wants the WHOLE of Ukraine - World War 3 Untended Consequences - 6th Feb 22
8.Dow Stock Market Expected Max Drawdown 2022 - 19th Feb 22
9.Stock Market Calm In the Eye of the Inflation Storm - 4th Mar 22
10.M = F - Everything is Waving! Stock Market Forward Guidance - 7th Mar 22
Last 7 days
Why APPLE Could CRASH the Stock Market! - 21st May 22
Why Is Crude Oil Ignoring US Inventories? - 21st May 22
Here is Why I’m Still Bullish on Gold Mining Stocks - 21st May 22
US Real Estate Investors – Is There An End In Sight? - 20th May 22
How Technology Affected the Gaming Industry - 20th May 22
How To Set And Achieve Reasonable Goals For Your Company - 20th May 22
How Low Could the Amazon (AMZN) Stock Price Fall? - 19th May 22
Bitten by FANG? Clocked by Cryptos? -- 'Air Pockets' Everywhere - 19th May 22
Northern General Hospital Orthopedics Fractures and and Ankle Clinic Consultations Real Patient Experience - 19th May 22
Cathie Wood Goes All in on Teladoc, ARKK INSANE Noob Investing Strategy! - 17th May 22
This is Anything but Positive for US Housing Market - 17th May 22
What Should We Do If There Is No Fed Monetary Policy Pivot? - 17th May 22
All Possible Ways to Earn Free Litecoin - 17th May 22
How low Could the Amazon Stock Price Fall? - 16th May 22
Cathy Wood ARKK INSANITY There is NO Coming Back! - 16th May 22
NASDAQ 100 Stock Market LOWER LOWS & LOWER HIGH - 16th May 22
Sanctions, trade wars worsen US inflation - 16th May 22
AI Tech Stocks Earnings BloodBath Buying Opportunity - 14th May 22
Futures Contract – Trading Crude Oil With USO - 14th May 22
How to Get Kaspersky Internet Security for 80% Discount! Do not Pay Renewal Price! - 14th May 22
Sagittarius A* Super Massive Black Hole Monster at Centre of Our Galaxy REVEALED! - 14th May 22
UK Public Debt Smoking Inflation Gun - 13th May 22
What Happens When the Stock Market Dip Keeps Dipping? - 13th May 22
Biden Seeks Inflation Scapegoats; Gold Advocate Wins GOP Primary - 13th May 22
Apple and Microsoft Nuts Are About to CRACK and Send Stock Market Sharply Lower - 12th May 22
The War on Gold Ensures the Dollar’s Downfall - 12th May 22

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Following Twitter, Elon Musk May Next Want to Acquire Silver

Commodities / Gold and Silver 2022 Apr 27, 2022 - 05:07 PM GMT

By: MoneyMetals


Elon Musk’s $44 billion purchase of Twitter is being hailed as a victory for free speech. Musk vows to make changes to the social media platform that will make it a true “digital town square” where people are free to speak their minds, even if others take offense.

Of course, not everyone is excited about the prospect.

“Biden officials worry Musk will allow Trump to return to Twitter,” CNBC informs us.

Musk, meanwhile, is worried that the Biden administration may launch retaliatory attacks by securities regulators. He is also concerned by government policies that are stoking inflation.

The Tesla CEO noted in his company’s latest earnings call that "inflation is at like a 40 or 50-year high. And I think the official numbers actually understate the true magnitude of inflation.”

Tesla factories depend on suppliers of raw materials including metals. And suppliers are raising prices.

"In some cases, we’re seeing suppliers request 20% to 30% cost increases for parts from last year to the end of this year," Musk said.

Of special importance is lithium, a metal needed for Tesla’s battery systems. The problem is that demand for lithium is growing faster than supply, sending prices skyward.

Musk has suggested that he might have to get into the mining and refining business himself to secure adequate supplies of lithium. He may decide it’s wise to invest in other scarce metals as well, including silver.

Each Tesla requires close to 50 grams of silver. It may not sound like a huge amount, but if Tesla is to meet its production goal of 19 million more vehicles by 2030, it will need over 30 million ounces of silver.

Silver, unlike lithium, currently remains cheap on an historical basis. But silver is also projected to be in a supply deficit this year, with industrial demand set to hit a record high.

Rather than take on the risks of owning and operating a silver mine, Musk could begin building stockpiles of the metal while it is still obtainable without having to pay a huge premium.

Tesla has already declared it will hold alternative assets such as cryptocurrencies on its balance sheet. While Musk is famously fond of cryptos, they haven’t helped Tesla stay in front of this year’s inflation surge.

Both Bitcoin and Dogecoin prices have lagged in recent months. And neither does anything in particular to help Tesla obtain the basic materials it needs to build new vehicles.

Tesla’s 10-k filing from 2021 that stated in addition to holding Bitcoin, the company “may invest a portion of such cash in certain alternative reserve assets.” These include “gold bullion, gold exchange-traded funds and other assets as specified in the future.”

A single Elon Musk tweet about the value of holding precious metals could move the markets.

But if he’s serious about acquiring gold as cash reserves and strategic metals including lithium and silver for manufacturing, he would understandably want to keep quiet while he’s still trying to accumulate at today’s prices.

The multi-billionaire was moved to acquire Twitter less because of its potential to generate revenue and more because of his vision for it to serve as bastion for free speech. Musk also has a vision to make all vehicles self-driving and develop the technologies needed for humans to inhabit other planets.

It doesn’t take a visionary to see the need to protect against the corrosive forces of inflation. It just takes common sense, which in practice means an ability to see through the official propaganda that underpins the Federal Reserve’s inflationary monetary policies.

Whether you’re an individual of modest means or the head of a trillion-dollar company, you face the same basic problem of how to plan for a future in which your dollars will purchase less and less of what you need.

The solution is to become resilient to declines in fiat currency value. A primary way of attaining such resilience is to own hard currency in the form of gold and silver.

Stefan Gleason is President of Money Metals Exchange, the national precious metals company named 2015 "Dealer of the Year" in the United States by an independent global ratings group. A graduate of the University of Florida, Gleason is a seasoned business leader, investor, political strategist, and grassroots activist. Gleason has frequently appeared on national television networks such as CNN, FoxNews, and CNBC, and his writings have appeared in hundreds of publications such as the Wall Street Journal, Detroit News, Washington Times, and National Review.

© 2022 Stefan Gleason - All Rights Reserved

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

© 2005-2019 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.

Post Comment

Only logged in users are allowed to post comments. Register/ Log in