![]() In 2022, the US government spent $6.27 Trillion with total revenues of $4.9 Trillion. Thus, silver outperforms gold to the upside, just like it has underperformed recently to the downside. However, it is essential to remember that silver is volatile. Historically, silver makes significant leaps to close this gap whenever this has occurred. The spot price is extremely close to the production price, so silver seems to have limited downside.Ĭurrently, there is an enormous chasm between the price of gold relative to the price of silver. Moreover, silver's cost of production puts a floor under its price. Fortunately, all of these applications are all using a lot of silver. ![]() This narrative is in question because the pivot to NetZero means an increased demand for renewables, including wind, solar, EVs, and batteries. However, this is a double-edged sword silver has been under-performing much like oil, in part because the market believes a recession will diminish demand for silver in consumer products. Silver is not a primary monetary metal because it is also an industrial metal. By contrast, gold does not have these counterparty risk problems – and it’s a premier asset class worldwide.Įven last year, when gold stayed flat for the year, it outperformed Tesla (NASDAQ: TSLA) by 73%, Facebook (NASDAQ: META) by 66%, PayPal (NASDAQ: PYPL) by 65%, AMD by 58%, NVidia by 53%, Netflix (NASDAQ: NFLX) by 52%, Amazon (NASDAQ: AMZN) by 51%, Disney by 45%, Google (NASDAQ: GOOGL) by 40%, Microsoft (NASDAQ: MSFT) by 29% and Apple (NASDAQ: AAPL) by 29%. In turn, the account is a liability to the bank. For example, when someone opens a bank account and makes a cash deposit, he surrenders the legal title to the cash, and it becomes an asset of the bank. Bank deposits refer to this liability rather than to the actual funds that have been deposited. The deposit itself is a liability owed by the bank to the depositor. Returning to fundamentals is a crucial refresher and could be critical in risk management.įrom Investopedia, How Bank Deposits Work Going back to basics is essential to understand the interplay between banking, gold and silver. Bancorp stock lost 7% to close at $42.30 a share. Pasadena-based East West Bancorp (NASDAQ: EWBC) shares were down more than 12% to $64 a share.Salt Lake City-based Zions Bancorp stock fell more than 13% to a 52-week low of $40 a share.New York-based Signature Bank (NASDAQ: SBNY) stock fell more than 21% to $82, a 52-week low.Phoenix-based Western Alliance (NYSE: WAL) Bancorp stock lost nearly 35% and trades at $49 a share.First Republic Bank (NYSE: FRC) based in San Francisco, saw its shares plummet 16.5% Thursday and 15% Friday to $80 a share, a new 52-week low.Things have been breaking in the past two days: Critics of this monetary policy stated, "The Fed will keep hiking until they break something." Rate hikes had never accelerated so high in such a short duration. One of the prevailing themes is that the Fed has been trapped via its mandate to fight inflation and maintain high employment. or rolling into higher rate options, squeezing bank profit margins. ![]() The entire bank stock index is down big as overnight deposits have been walking out the door. This Friday morning, trading in Silicon Valley Bank stock has been halted as a classic run on the bank unfolds. Meanwhile, Silicon Valley Bank competitors like JPMorgan (NYSE: JPM) sought to convince some SVB customers to move their funds from SVB to JPMorgan. In addition, numerous customers stated having difficulty logging in to the company's website to view their account information and make transfers. The bank's support phone lines became inaccessible. One day later, Silicon Valley Bank informed some clients that wire transfers could be delayed. This announcement sent its stock price plummeting, following a months-long downward spiral for Silvergate Bank, which was over-exposed to cryptocurrencies. On Wednesday, March 8, 2023, Silvergate Capital (NYSE: SI) announced it ended operations and liquidated its Silvergate Bank. In fact, the bank reported record-breaking growth in deposits and loans in 2020, thanks in part to increased demand for its services from clients in the cryptocurrency industry. In September 2021, Silvergate Bank, specializing in digital currency, was performing well. Create New Watchlist Create Create a new holdings portfolio Add Create + Add another position Close
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