March 2025 – Week 2 Edition
Why Silver is Now Matching – Sometimes Exceeding – Gold’s Gains
Historically, gold tends to exceed silver’s gains as an inflation and crisis hedge but so far this year, silver has risen more than gold, with 13% gains for silver vs. 11.5% for gold, through March 12th. Since the start of 2020, gold is +93.2% vs. 88.3% for silver, which is fairly close. Longer term, since 2000, gold is far in the lead, with 912%+ gains vs. 522% gains for silver.
The Dow, up 260%, and the S&P, up 281%, both significantly trail gold's and silver’s performances.
Silver has been pulling even with gold in recent years for two basic reasons, according to an article in the prestigious British weekly magazine, The Economist (“The New Gold: Safe haven demand and solar panels have sent silver’s prices soaring,” March 8, 2025). The first reason they cite (safe haven demand) includes private investing in silver coins and bars. Last year was the first year since 2021 that silver exchange-traded funds (ETFs) saw net inflows. In addition, Russia has announced that it will be adding silver to its central bank’s buying of precious metals. The other reason silver is rising involves increased industrial demand, notably in solar panels:
“The annual supply of silver, driven by mining production and recycling, has contracted slightly over the past decade, according to the Silver Institute [yet] over the same period, industrial demand has surged by more than 50%, owing largely to silver’s use in solar panels. Imports into China, which manufactures large quantities of these, have shot up.
“Since mining capacity cannot be expanded quickly, the imbalance should continue to boost silver’s price for some time. As the world becomes a more fractious place, it is hard to imagine investors’ demand for these assets falling soon.” – The Economist, March 8.
With these solid, long-term fundamentals in place for rising demand and static or falling supply, investors should include both gold and silver in a balanced portfolio as crisis hedges, inflation hedges and – with silver – an investment in rising industrial demand vs. limited new supplies. That’s why many experts recommend buying gold, silver and rare gold coins periodically for diversification and long-term returns. I urge you to call one of our professional representatives today to invest in and protect your financial future with precious metals and rare coins.
Inflation Still Rising in 2025 – But CPI Remained Muted in February
The Consumer Price Index (CPI) for February was released early Wednesday morning, March 12, and it came in milder than expected, rising 2.8% over the past 12 months. That is down from 3% in January. This is because few of the effects from new tariffs have been added to overall prices and there were some price declines (like airfares) due to lower consumer demand and unusually cold winter weather, which was 1.1 degrees cooler than average – the coldest winter in 11 years.
Longer-term, the Consumer Price Index is up 32-fold since the Federal Reserve was founded in 1913, up 8-fold since the dollar was taken off the gold standard in 1971. The CPI has almost doubled since 2000, and it rose over 21% during the four years under Joe Biden and Kamala Harris.
Our 2025 dollar is worth only 3 cents in terms of the 1913 dollar and less than one cent in terms of gold in 1913 prices – and only 1.2 cents in terms of gold from 1934 to 1971 at $35 per ounce.
The Producer Price Index (PPI) came and was even milder than the CPI, at no change, month over month. The “core” PPI (subtracting energy, food and trade) rose 0.2%. Year over year, the Producer Price Index is up 3.2%, but none of this reflects the trade war of rising tariffs announced (or taking effect) in March, nor does it reflect the rise in the CRB Commodity Price Index, which is up 3% so far this year. This index of 19 commodities is a leading indicator for producer prices. Overall, February appears to be a lull before the March inflation storm hits.
In the first three days of this week (March 10-12), gold is up $50 (+1.7%). Silver is up more than twice that much, in percentage terms (+4.3%), from under $32 to $33.22. In the first 10 weeks of 2025, silver is up 13% and gold is up 11.5%, while stocks are still mired in negative territory. The S&P 500 is down 4.74% and the Dow is down 2.77%, proving again the precious metals’ valuable role as a hedge against several market dangers – including rising inflation, world crises and a stock market bubble.
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