After years of lagging behind gold and remaining relatively stagnant, silver is finally making a notable upward move. But why now? What’s fueling this sudden breakout?
Peter Krauth, a precious metals expert and author of The Great Silver Bull, believes this is more than just a short-term rally — it’s the result of deep, mounting economic forces now surfacing in the market.
Inflation Is No Longer “Transitory”
According to Krauth, inflation has become a permanent feature of today’s economic reality, no longer just a "transitory phase." He points to the Core PCE index — the Federal Reserve’s preferred inflation gauge — which has risen from 2.75% to 3.5% in just a few months, far above the Fed’s 2% target.
Coupled with a slowdown in GDP growth in the first quarter, Krauth sees the makings of a classic case of stagflation — weak economic growth paired with rising prices.
Warning Signs from the Bond Market
This outlook is supported by bond market signals. U.S. Treasury yields are climbing, signaling falling bond prices. Krauth highlights the 20-year Treasury bond ETF (TLT), which appears poised to break below previous lows — a sign of declining investor confidence in government debt instruments.
Meanwhile, the yield on 30-year Treasuries has surged from just 0.1% during the height of the COVID-19 crisis to nearly 5% today — a historic shift that places major pressure on U.S. debt servicing.
Massive Debt and Imminent Maturities
Out of the total $36 trillion in U.S. national debt, $9 trillion is set to mature this year alone. According to Krauth, the only viable way to service this is by printing more money — a move that fuels further inflation fears and drives investors toward safe-haven assets like precious metals.
Gold Led the Way… Silver Is Catching Up
While gold has already priced in much of the inflation risk, Krauth says silver is only just beginning to react. Recent political tensions may also be playing a role — particularly the clash between Donald Trump and Elon Musk, who has criticized Trump’s massive spending plans as highly inflationary.
Could Silver Hit $50?
Krauth forecasts silver could reach around $40 in the second half of this year, with a strong possibility of breaking the long-standing $50 barrier sometime in 2026. If that level is surpassed, he expects silver could surge further, reaching $60–$65, driven by momentum and the lack of historical precedent.
He concludes:
> “Once silver breaks above $50, we’ll be in completely uncharted territory... and we could see prices we never imagined before.”
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