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The Price of Silver Could Explode Higher as Trade Tensions Between The US and Mexico Flare - Nathan McDonald (2/2/2017)

From the archives of sprott money news

February 2, 2017

Silver, undervalued and overlooked. This is a fact about this commodity and it very well might be about to change, and in a serious manner.


For years, it has been in a sideways pattern after reaching its near $50 high. It has been cast aside as investors have become discouraged, and honestly, you can't blame them. For those not strong of heart, or strong of will, it has not been a great period to be invested in silver.


Yet, for those who have been thinking long-term, you have been doing the intelligent thing and thinking in ounces, not fiat dollars. You have been stacking and accumulating your real wealth, your hard money.


Now, silver stands on a potentially explosive opportunity, one that could be imposed on it not on its own accord, but by external political forces.


It is no secret to anyone that a dispute over "the wall" between Mexican and US leadership has been taking place in the public court. The argument is over who is going to pay for it, and why they should.


It is very unlikely that the Mexican government will do this. They simply cannot due to political pressures from within their country, even if long-term it would be in their best interest.


Unfortunately, there are other ways in which they can be made to pay which are out of their control, such as the much discussed 20% border tax that is now being floated out there. If imposed, this could lead to an explosive rise in the price of silver.


Historically, Mexico has been the largest silver producer in the world, and if a 20% tax is imposed on it, then it could lead to dramatically higher prices in the short term, especially within the United States as wholesalers are sent scrambling to find alternative sources of supply.


Take also into consideration that the US debt level is set to surpass the $20 trillion mark any day now, and you can quickly begin to see the potential profit that is unseen in the currently depressed silver prices.


Will this unfold? It is unclear as of yet, as an agreement could always be reached before such dramatic actions are taken on the United States' part, but the odds are there, and they are high as this game of chicken comes to a conclusion. Regardless of the outcome, I'll be stacking.

Don’t miss a golden opportunity.

Now that you’ve gained a deeper understanding about gold, it’s time to browse our selection of gold bars, coins, or exclusive Sprott Gold wafers.

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About the Author

Nathan McDonald is a libertarian, entrepreneur and precious metals enthusiast. He has always taken a keen interest in free markets and economics since an early age, which naturally led him to become a true believer in precious metals and all that they stand for.

Nathan served eight years in the Royal Canadian Navy as an electronics technician, seeing the true state of the world, before starting his first successful business. He has since gone on to create a number of businesses, all of which are still in operation and growing.

In addition to this, Nathan runs a network of successful precious metals blogs, and a growing newsletter that has attracted readers from all around the world. He is a regular and highlighted writer for the highly respected Sprott Money Blog, which covers world events, geopolitics and of course precious metals.

*The author is not affiliated with, endorsed or sponsored by Sprott Money Ltd. The views and opinions expressed in this material are those of the author or guest speaker, are subject to change and may not necessarily reflect the opinions of Sprott Money Ltd. Sprott Money does not guarantee the accuracy, completeness, timeliness and reliability of the information or any results from its use.


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