This fresh chart highlights how dwindled the inventory level situation still remains at the London Metal Exchange. Perhaps this year’s commodity price selloffs and relative fiat US dollar strength over the last year have helped quiet this ongoing constraint. One only has to look back over the past dozen years to understand how supply shortages in metals and energy have happened.

bullion vs derivative

The trends and evidence point to my firm opinion of where this eventually leads. Basically, there will come an era where any large deliverable amounts of either silver bullion and or gold bullion priced reasonably close to spot and/or futures market quotations will not be findable. Those that are too late will get to own underperforming unsecure ETF slush funds like $SLV, $GLD, or $IAU. Good luck. I sincerely hope you’ll not be one of them, having secured your prudent bullion stashes before a potential wide-scale physical bullion shortage era arrives globally, especially in the western investment world.

Buying Physical gold and silver seems to be the way to go in terms of maintaining wealth. As we have seen the physical silver and gold has maintained its large premiums whereas paper silver and gold has not. Paper silver has its benefits since there isn’t an inventory (where you hold the metals) but it’s nice to be able to hold your investment in your hands and stash it away yourself. check out the video below to find more about bullion vs derivative