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SLV: Recent Drop In Real Interest Rates May Portend Another Breakout In Precious Metals

Harrison Schwartz profile picture
Harrison Schwartz


  • Silver and gold have been stagnated for nearly a year as real interest rates have remained near all-time-lows.
  • Continued Q.E efforts have pushed real interest rates to new lows - causing my implied fair-value of gold measure to reach nearly $2100/oz.
  • While the gold-to-silver price ratio is still historically high, gold may be favorable in the short run due to its minimal cyclical dependencies.
  • Economic data is now showing clear signs of a potential "double-dip" recession which could cause disinflation and a decline in industrial metal value.
  • SLV is superior to physical silver for larger amounts of money as it does not come with big premiums and is far more liquid.

Silver bars or ingots background. Precious metal.
Bet_Noire/iStock via Getty Images

Like most markets today, the precious metals market seems increasingly mired in media-frenzy with highly sensationalized arguments and views from both bulls and bears. While emotions play a crucial role in short-term trading, I believe that it is

Silver and gold price
Data by YCharts

Silver, Base Metals Price, Manufacturing PMI
Data by YCharts

This article was written by

Harrison Schwartz profile picture
Harrison is a financial analyst who has been writing on Seeking Alpha since 2018 and has closely followed the market for over a decade. He has professional experience in the private equity, real estate, and economic research industry. Harrison also has an academic background in financial econometrics, economic forecasting, and global monetary economics.

Analyst’s Disclosure: I/we have a beneficial long position in the shares of SLV either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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