Speaker 1This is the Commodity Culture Podcast, where we interview prominent investors, fund managers, analysts, and company CEOs to give you an edge when it comes to investing in the commodity
Speaker 2space. Ian Everard, great to have you on Commodity Culture. You're coming to us today from the Osmium Institute in Germany. We're going to get into that metal up ahead because it has a very fascinating value proposition behind it. But first, we have to dive into the silver market here because we've seen silver now back around $61, failing to breach that $70 level, which it looks like it wanted to do. And now we're looking like we could break below $60. What do you think of this recent drawdown? And is this a buying opportunity or a time to exercise caution in your view?
Speaker 3Oh, my. Yeah. So personally. Yeah, it's always disappointing. As a stacker, you want to buy it and it always to keep going up. For any of us who started stacking when it was in the teens, it's a lot easier to bear this pain and frustration of this extreme, what it seems extreme volatility. I mean, a $10 move in weeks is either way. Oh, my gosh, this is a roller coaster. But I think stackers, we need to hang on. And I think that's where this ends up eventually, is that silver and gold become money again, the only trusted form of tangible asset as money. The journey to get there is going to be interesting. So I think generally, if you have dollars and you don't know what to do with them or you're concerned about where they are, yes, I think it's a good time to increase your silver stack. Yeah.
Speaker 2And I think if you have a long term time horizon and understand the fundamentals behind the sector, we would welcome lower prices. I would love lower prices because I know in the long term where things are going. Talk about that shift to precious metals is money because the setup right now seems to be getting stronger and stronger in that the global financial order in many ways seems to be falling apart. We're seeing yields on US Treasury bills rise considerably the two year looking like it's going to touch 5% here. Yeah. And across the board, we're seeing yields rise not only on US debt, but across the world. Of course, $40 trillion has been surpassed in national debt for the United States. Scott Besant announcing some sort of intervention, more Treasury buybacks. I mean, this whole picture looks like it's spiraling out of control. I spoke to Alasdair McLeod recently. He said the end of the fiat currency system is going to happen faster than most people expect and you need to get positioned for that. So I'd love to get your thoughts there on just this whole. Yeah. Picture that we're seeing in the global financial order and how precious metals will come into
Speaker 3play. Wow. Now how do I give the best answer to that? The best moves I've made financially in my life have been through gut instinct, not necessarily through logic, not necessarily through charts, not through predictions. My gut instinct is on the fiat system, we will go fully digital. And when we go. Fully digital, that will delay the collapse because when everything is fully digital, and I've said many times before, velocity will be controlled. Every cent, every penny, every Euro, every currency that is now fully digital, it will be permissioned where, when, and if you can spend it and how you can spend it and the rate you're allowed to spend it at. What interest you get on it, whether you're getting negative industry in interest, whether you're holding. Or holdings might be erased if you don't spend it, or if you commit an offense, either a criminal offense or a political offense, you, you could have, you know, and this is the whole talk, isn't it? Of the stable coins, a feature of them, they can be burned, vaporized, destroyed. So I really respect Alistair, but I don't think that final collapse is imminent. I think there is a few years, probably five years. I think it is. I think there is a minimum from when we go fully digital, before we get that catastrophic collapse that Mises in his writings predict is the only way a Fiat system ends. If you insist on keep on inflating it, you end up with a catastrophic collapse. So I think we're at least five years away from that point, but on the journey to that, we're going to see more financial repression, more unrealized tax taxation, more wealth tax. It's obvious because the US debt of $40 trillion actually is not a problem because supposedly there's $180 trillion of personal wealth in the US. So all a US institution government regime would have to do is steal a little bit of that, but the debt is gone, but what they can't deal with is the unfunded future liabilities, which are possibly 150 trillion and not only are they 150 trillion, they are growing. So we're at roughly 10% per year compounding. The future liabilities are growing at twice the current interest rate. So to me, that would suggest that really the real value that should be placed on loaning out currency, even wanting it back, should be 10%. So I think we could be heading for that. So at what point does the system break, because when the system comes to a point where they're saying there will be no lenders at any price to governments because they realize they're not going to get the value of their principal back, that's the point. I think that the full digital system will be brought in to delay the catastrophic collapse.
Speaker 2And do you think that when the collapse happens, that will force governments to go onto a sound money standard because we all know that they're going to avoid this with every ounce of their being because it actually strips so much of the political class of their power. There's very few voices out there aside from Ron Paul, I mean, I can't think of many others in the political realm who are actively, you know, calling for some sort of sound money backing. Maybe Thomas Massey has mentioned it, perhaps Rand, but there's not many out there. So is this going to be a situation of, you know, their hand will be forced when that
Speaker 3time comes? So we could have a completely different landscape at that point of the catastrophic collapse. Governments will not have anything. They can pay their workers with, they'll have nothing that will encourage their workers to turn up for work. They won't have enough to eat, to travel for housing, you name it. At that point, what sort of government will we have now as a small libertarian, hopefully very little government, um, you know, so how do we get into our minds that in the future, there'll be a completely different scenario ahead of us. It won't look like anything we've seen previously. I heard an analogy once, I think it was at the New Orleans Investment Conference. I think it was a property guy. He said, you know, financial life ahead is like playing around a golf. You know, you study the course and you, you get the right clubs to play the, you know, to play the holes. Now I've never played golf, but I love that analogy because what's coming ahead is a completely new course. We don't know what the course looks like. We don't know how many holes it's got. We don't know how many bunkers or, or lakes or rivers. We don't know what clubs are. We don't know what size to ball. We don't know anything about how that's going to pan out. So for me, the only way that I can personally prepare for it is to store up as many tangible assets as possible, not just the traditional silver and gold, but also hand tools, boxes of nails, you know, shovels. Simple things that we presume we can always go down to Ace Hardware and buy well after a catastrophic collapse, there isn't going to be an Ace Hardware in your high street because there won't be the system to make all of the wheels and all the cogs work for that. We will become possibly completely de-globalized. I mean, we're heading that way in the U S anyway, but add onto the fact that how can a country be paid for any goods or products? You know, because the value of that, everybody's currency is diminishing so fast. People aren't going to turn up for work. So yes, at that point, gold and silver become money again, but I really hope, but it's nothing to do with big federal government.
Speaker 2Yeah, completely agree with you there. Let's get back to silver for a moment because of course there's been a lot of accusations of manipulation in the market. Certain people I speak to like Ed Steer have a very strong view that manipulation is extraordinary. Prevalent. He believes the reason silver has not been able to breach 70 and that it's been knocked back down is essentially 100% due to manipulation of the market by the large bullion banks. I have people on the other side of the coin, Rick rule. When I put that proposition to him said it's ridiculous. So he's bought Bob Moriarty as somebody else who's on that side of saying all markets are manipulated to some extent. We can't get hung up on what these people are doing. We just have in the longterm, you know, the reality will overwhelm the paper market. What are your thoughts on, on recent price action and the potential intervention of nefarious players in it?
Speaker 3let's look at it from a different point of view if china was trying to accumulate silver which i would say they have to because they want to carry on expanding their society and carry on you know their more advanced electronics and more advanced manufacturing if they aim is to become dominant as a manufacturing power or more dominant they have to have silver now if i was trying to accumulate silver would i want to force the price up no would i want to crash the price down probably not because if you crash the price down you're going to suppress exploration and more production of silver and you're going to suppress recycling because it's not economic it doesn't even seem to be economic at 60 70 for recycling small micro amounts out of billions of applications so i but is you , so really does it really matter if there's manipulation yes for the public because the manipulation has caused greater volatility and dave kranzler always used to say he wasn't that a proponent of vast manipulation but he did say you can drive something in the direction it's going you can increase the speed so what i'm getting around to is the volatility scares a lot of people out of buying precious metals combined with the dysfunction of the retail bullion industry in the u.s that the spreads with the big dealers are just ridiculous you know 10 15 spread if you bought it on one day and wanted to sell it back you're going to lose 15 an ounce that's ridiculous so the deterrents are there to stop prevent people buying retail well if you think about it if there's only i don't know 0.6 trillion dollars of silver and you're going to lose 15 dollars of silver and the world you know if there's 10 billion ounces that could be available it's such a tiny amount financially it would only take a tiny amount of personal private held money to move into silver and then the price would just take off so i think the real manipulation isn't as much in keeping the price down it's keeping it volatile because when i started buying silver personally in 2017 i think what is it 16 15 17 dollars an ounce so i'm happy because most of my silver if i average my average cost it's probably matched the s&p probably exceeded it but it hasn't got the risk of a 50 60 70 80 90 percent drop and it definitely hasn't got the risk of the government seizing it telling me i can or can't hold it because they don't know i hold it well unless they're watching so for government's watching you in anything don't don't so but yes so i think the volatility is the biggest deterrent to retail investing and it is it's potentially retail investing where we'll just suck up all of the available silver because it's only a fraction of percent of the currency held on deposit even just in checking counts let alone in other investments so you wouldn't even need money to move category investments into silver you just need a little bit of checking counts and money counts so that volatility definitely does suppress retail demand now you mentioned china's
Speaker 2role in the silver market what do you make of this persistent 12 to 13 percent premium on the silver price in shanghai versus the west now one argument i'll get out of the way right now for some people who are watching this is not vat tax or any sort of tax spread initially people were saying oh it's just the extra tax no this is an actual differential in the price of silver between shanghai and the west it's also been elevated in india recently as well but let's stick to china how significant is this spread in terms of how it impacts the global silver market and do you think the true price of silver could be increasingly set by china moving forward
Speaker 3so answering that last point first absolutely china will decide what price precious metals are and as i mentioned on our last interview we we talked about that 20 2014 statement by the shanghai gold exchange that when china was in a position to they will set the price of gold and so we're coming closer and closer to that point that china has accumulated huge amounts of gold i'm almost definite they've accumulated huge amounts of silver so um i've forgotten the question now it was uh
Speaker 2do you think china will increasingly be setting the price and the spreads on on the price so
Speaker 3the spread is it's hard to answer that question i think it's hard to answer that question because i think it's hard to answer that question i think it's hard to answer that question i think it's hard to answer that question because i think it's hard to answer that question because i think it's hard to answer that question the light catch the sparkle on that yeah so in its crystalline form it's the densest we can ever get an element to there's no compound element even temporary erogenous radioactive substance can get to that density so it is completely unforgeable because any forgery wouldn't have the density also in that form it doesn't dissolve in acid alkali or mix aqua regia it will not touch so you can't dissolve it everything else on the planet dissolves so you can't reduce it by dissolving it and also its crystalline pattern never repeats so when you see a piece particularly in sunlight you see blues and grays it's because of the near perfect hexagonal crystal crystalline structures are parallel to the surface and that reflects parallel light straight back at you so when you take a piece of crystallized osmium with a similar diamond in sunlight it makes a diamond like a cheap piece of glass its reflectivity its sparkle is captivating so that's its beauty um as a tangible asset i like it because yes it's a private monopoly that produces it and it's a private monopoly that cuts and certifies it they have decided to cap the total production to 350 kilos well if you imagine an average laptop is about 10 10 inches if you imagine a 10 inch cube all of the crystalline osmium they are ever going to manufacture will fit in a 10 inch cube so the absolute scarcity is absolute purity it's absolute purity and it's absolutely unforgeable and there is a private database proving ownership there is can never be a dispute about ownership it makes an ideal high value transactional tangible asset because in your hand you could hold 10 million 20 million dollars do a transaction privately authenticated without a bank involved without a government involved so it has incredible power as probably the highest value for high value transactions as well as its scarcity but to be honest i love it because it's captivatingly beautiful if you're interested in making jewelry or fine art it makes it it's exquisite um hopefully i'm going to do some video whilst i'm here at the institute so i can put on my youtube site some of the beautiful pieces that it's inspired to make so it's an inspirational metal
Speaker 2as well yeah taking the jewelry market by storm to be sure but i think our interest for people watching this show of course is that tangible asset angle you've spoken about of course the obvious question a lot of people will be asking is well couldn't another company or another organization or another group of scientists just crystallize their own osmium and thus increase supply on the market um what is there a guarantee that won't happen or what what why why are people so confident at the osmium institute that that's not not a very realistic
Speaker 3proposition that's often and if that is a concern that you are really concerned about don't don't buy any and now i'm pretty cautious i've worked hard to get where i am and i'm happy buying as much osmium as they will sell me because they are a decade or more ahead of anybody else in just the structure and the excellence they produce the institute the database the high resolution scans high religion photographs the ownership codes they have done this the german way to perfection every detail on the technical side could somebody else produce this possibly but it did take rolf who is an absolute genius 40 years and then another five years to even improve the excellence so they could get to the level of being able to make it even enough for watch faces so as far as we know there's at least 160 conditional steps once you have purified the osmium and once you have boiled the osmium 160 steps if you start working out now if any of those steps are omitted or done in the wrong order or done incorrectly the whole process fails and you have to start again so the cost to get to that point now people could say well couldn't ai work it out except that information isn't on ai because rolf has not shared how he does it you cannot visit the laboratory i am not allowed to visit a laboratory he is so confident you know he hasn't issued a patent he is absolutely confident nobody else will work it out but if that is a concern don't don't buy it you know and the beauty is there's so little of it so few people will hear about it even fewer will actually hold and see a piece and even if you will even be able to buy a piece if they want to buy a piece they are already sold out of the lower sparkle grade of the finest crystallization that's gone there's no more so they have a grade one through five uh one is sold it's gone and some of the other grades are diminishing there's not a lot left so it that that's the beauty of it you know and it is the brand the osmium institute is a worldwide brand we have a team of excellent people from around the world new teams are joining which is great because each country demands a variety of products and we have a team of excellent people from around the world new teams are joining which is great because we have a team of excellent people from around the world new teams are joining which is great because each country demands an investigation into is this real is this genuine i mean for japan to accept it they had to add a whole nother set of independent laboratory analysis you know so that was great um you know it was tested in portugal the portuguese company that tested it thought their equipment was broken because it showed us pure nothing can show us pure so so that's another that's another that's another that's another that's another that's another that's another that's another thing that captivates me it's that's another thing that captivates me it's that's another thing that captivates me it's the purest thing that man will ever make the purest thing that man will ever make the purest thing that man will ever make physically physically physically so it has so many features just rolled in so it has so many features just rolled in so it has so many features just rolled in into you know into a metal that looks into you know into a metal that looks into you know into a metal that looks like you know an incredible gemstone as like you know an incredible gemstone as like you know an incredible gemstone as well well well so
Speaker 2so so a lot of information there
Speaker 3a lot of information there a lot of information there you know if anybody wants more you know if anybody wants more you know if anybody wants more information or pacifics i'm happy to to information or pacifics i'm happy to to information or pacifics i'm happy to to to expand you know expand you know expand you know uh at length uh at length uh at length but if you don't get it that's fine but if you don't get it that's fine but if you don't get it that's fine because because because so few people will even be allowed to buy so few people will even be allowed to buy so few people will even be allowed to buy any so it doesn't matter any so it doesn't matter any so it doesn't matter you know you know you know i've been very happy i started buying it i've been very happy i started buying it i've been very happy i started buying it around 900 around 900 around 900 a gram it's now 2600 a gram so it a gram it's now 2600 a gram so it a gram it's now 2600 a gram so it hasn't gone up quite as fast as silver hasn't gone up quite as fast as silver hasn't gone up quite as fast as silver in that period in that period in that period but it's been stable um and as for resell but it's been stable um and as for resell but it's been stable um and as for resell yes that is an issue what is the yes that is an issue what is the yes that is an issue what is the liquidity liquidity liquidity uh yeah but that is growing and i tie uh yeah but that is growing and i tie uh yeah but that is growing and i tie that in actually to the jewelry use that in actually to the jewelry use that in actually to the jewelry use because the jewelry market is ever because the jewelry market is ever because the jewelry market is ever expanding in fact i think just arriving expanding in fact i think just arriving expanding in fact i think just arriving in the building here is a major jewelry in the building here is a major jewelry in the building here is a major jewelry brand from new york who have are brand from new york who have are brand from new york who have are planning to do release uh a series of planning to do release uh a series of planning to do release uh a series of nine pieces of jewelry nine pieces of jewelry nine pieces of jewelry if that happens and it looks like it's if that happens and it looks like it's if that happens and it looks like it's happening i'll be talking to the guy happening i'll be talking to the guy happening i'll be talking to the guy in a few minutes in a few minutes in a few minutes osmium is sold out it's gone wow
Speaker 2osmium is sold out it's gone wow osmium is sold out it's gone wow and that that that's the next question and that that that's the next question and that that that's the next question because you mentioned the price rise because you mentioned the price rise because you mentioned the price rise how is the price of osmium set because how is the price of osmium set because how is the price of osmium set because there's so little of it transacting or there's so little of it transacting or there's so little of it transacting or changing hands obviously you can't have changing hands obviously you can't have changing hands obviously you can't have a futures market or some sort of you a futures market or some sort of you a futures market or some sort of you know the market it's very difficult for know the market it's very difficult for the market to set the price the market to set the price the market to set the price so how is the price set and and how can so how is the price set and and how can so how is the price set and and how can somebody who buys osmium feel confident somebody who buys osmium feel confident somebody who buys osmium feel confident that the value will rise over time and that the value will rise over time and that the value will rise over time and they'll be able to sell it for that they'll be able to sell it for that they'll be able to sell it for that higher price
Speaker 3higher price higher price okay so absolutely full disclosure here okay so absolutely full disclosure here okay so absolutely full disclosure here and some of the other also my partners and some of the other also my partners and some of the other also my partners might not like this but heck um ingo's might not like this but heck um ingo's might not like this but heck um ingo's not here i don't think he's here so not here i don't think he's here so not here i don't think he's here so um as a state institute partner um as a state institute partner um as a state institute partner you get 11 rebate so that's your you get 11 rebate so that's your you get 11 rebate so that's your that's your margin 11 that's your margin 11 that's your margin 11 and then you can get another three and then you can get another three and then you can get another three percent so maximum 14 percent so maximum 14 percent so maximum 14 so that is the spread so that is the spread so that is the spread so as a state partner we will purchase so as a state partner we will purchase so as a state partner we will purchase osman 14 below the retail value so osman 14 below the retail value so osman 14 below the retail value so that's your spread but that's not that's your spread but that's not that's your spread but that's not actually much different to silver if you actually much different to silver if you actually much different to silver if you look at look at look at uh i can i name big companies on here i uh i can i name big companies on here i uh i can i name big companies on here i of course yeah well sd bullion j and of course yeah well sd bullion j and of course yeah well sd bullion j and bullion atmex if you look at their bid bullion atmex if you look at their bid bullion atmex if you look at their bid and ask and ask it's about 20 on silver it's about 20 on silver it's about 20 on silver so the spread on osman is smaller so the spread on osman is smaller so the spread on osman is smaller because we will buy back because we will buy back because we will buy back because there's less and less to buy from because there's less and less to buy from because there's less and less to buy from the institute there is going to be the institute there is going to be the institute there is going to be among people who understand osman among people who understand osman among people who understand osman increasing desire to accumulate more of increasing desire to accumulate more of increasing desire to accumulate more of it now as for how the price is set it now as for how the price is set it now as for how the price is set i don't like how they set the price i don't like how they set the price but it's a private monopoly and a private but it's a private monopoly and a private but it's a private monopoly and a private monopoly concept price of a product monopoly concept price of a product monopoly concept price of a product that is the capitalist world and to be that is the capitalist world and to be that is the capitalist world and to be and again if i might not like it well and again if i might not like it well and again if i might not like it well how else would you determine it how else would you determine it how else would you determine it if they're selling it as fast as they can if they're selling it as fast as they can if they're selling it as fast as they can cut and certify it cut and certify it cut and certify it the price is right and they are you know the price is right and they are you know the price is right and they are you know i mean i swing around there's a box i mean i swing around there's a box i mean i swing around there's a box there's a box of cut and certified right there's a box of cut and certified right there's a box of cut and certified right next to me there next to me there next to me there yeah literally yeah literally yeah literally you you order the pieces and if they you you order the pieces and if they you you order the pieces and if they haven't got them in stock they will cut haven't got them in stock they will cut haven't got them in stock they will cut and certify for them but they're selling and certify for them but they're selling and certify for them but they're selling it as fast as they they can get through it as fast as they they can get through it as fast as they they can get through it and that 350 kilo limit we're well in it and that 350 kilo limit we're well in it and that 350 kilo limit we're well in in into that in into that in into that so yeah it is a private monopoly that is so yeah it is a private monopoly that is so yeah it is a private monopoly that is how the price is set in the good catalyst why things pricey should be so well this
Speaker 2has been a really enlightening conversation about silver and the osmium market but i'd like to open the floor to you to end things when it comes to precious metals including osmium or anything else that's on your mind what do you think more stackers should be focused on in our current economic environment in the current gold and silver market environment
Speaker 3get your silver position first get your silver position first and hang on to it for dear life yeah then maybe a bit of gold then maybe a little bit of platinum you know and then maybe a little bit of osmium if there's any left um definitely if you can get a bit of rhenium we've spoken i'll ask into you about rhenium this is another fascinating metal and we are actually going to be pairing you with osmium as a jewelry metal um so um so yeah that that's my biggest exhortation at you know get your silver position and hold your silver position don't don't don't treat it as you know oh it's increased this much i must take my profits oh it's increased too much i need to rebalance my portfolio because whether you believe me or not this current system comes to an end with people talk about liquidity well what happens when you email or ring your broker up and say sell and he doesn't pick up because the government has taken him over or you know you know or we're in a full digital system and he picks up and you sell and now you've got digital dollars now you can't use them how you want to where's your liquidity then so the presumption that we have endless liquidity and in trading and stocks and shares and bonds it it's it's a myth because the system comes to an end when it comes to an end all the things we're used to having liquidity in freeze they cease so that's why you have to have your silver position and tragically there isn't enough for everybody in the world to have a silver position there isn't enough for everybody who has a million dollars to have a silver position there is that little amount of investable physical silver so that yeah that's a myth because the system comes to an end that is my exhortation is get your physical silver position and hold it
Speaker 2well guys uh reach out to ian everard at arc silver gold osmium he has some of the best prices around on gold and silver bullion products i'm going to put some of them on the screen along with the number and the email you can contact him at and of course one of the only places you can purchase osmium in the united states and i believe the only place you can purchase investment grade rhenium is that correct ian i think so yes
Speaker 3yeah that's that's sort of crazy isn't it but but then again i get it i understand it and it's played out as i've predicted so just because nobody else in the precious metal world seems to get it and i've talked to wholesalers and they're just i don't know they're just blinkered in tradition i
Speaker 2guess yeah well guys if you want to learn more about rhenium you can go back to our last interview i'll put that link in the description or just call ian ask him about it i'm asking why it's such a compelling investment and a compelling metal to add to your stack ian as always a fantastic conversation thank you so much for coming on and sharing your knowledge thank you jesse
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