Why I Bury Silver Coins Under Trees in Baltimore County

"What's your top silver play, Garrett?"

Wheaton Precious Metals. Or just straight up silver coins in a box under a tree somewhere in Baltimore County.

That's probably my best play.

Let me explain.

The Folgers Can Strategy

Picture this: multiple silver rounds under baseball cards, under my high school lacrosse jersey, in a Folgers can put inside a bigger Folgers can under a tree somewhere in Baltimore County.

It's kind of like Shawshank Redemption at the very end. You gotta find a rock wall that nobody would - it would be like out of a Robert Frost poem.

There's a rock there made of volcanic glass that has no earthly business being in a Baltimore County field.

Would you like me to just tell you the full plot of Shawshank Redemption? I could do that too.

Why Physical Beats Paper Every Time

Here's what I don't want to touch: SLV, which is operating on futures. I don't want to be touching paper claims.

I want to be focusing on actual physical claims. That's what CEF offers - the Sprott Physical Gold and Trust. This is just a claim on one particular one-to-one claim on gold and silver in a trust in Canada, run by Sprott.

Not like these ETFs that have multiple claims on every dollar. Thirty years ago, $1 would have three claims on it. Now it's about six or seven.

Gold doesn't have that in a one-to-one environment.

The Tank Theory of Capital Flows

Think of the market as a series of tanks of water. You got three big tanks.

The first one is Mag Seven. It is brimming. It is over the top. The water is falling off the side because foreign investment, passive investing and leverage is all tied up into that.

So money, because of the excess flow of capital, has to go somewhere else.

Money has gone into gold and silver. Central banks around the world buying up gold, retail investors buying up silver. A lot of those short positions that were on silver have been flipped, and shortages of supply.

It was a natural place for money to flow because people were looking at valuations and saying, wait a minute, silver is historically undervalued against gold. 

The gold to silver ratio a few months ago was a hundred to one. The mean is 60 to one.

Where Capital Goes Next

So silver has had a huge run and we might be getting to the point where that's gonna run out, where we're kind of at the brim again.

The question is, where can capital go next?

My argument is eventually - I don't know if it'll happen in the first three months, I don't know if it'll happen next year, I don't know if it'll happen in three years - but it's gonna have to happen eventually because things that are undervalued but are very high quality are still cheap.

The Real Wealth Equation

But until we figure out where that next tank fills up, I'm sticking with the basics.

Folgers cans inside other cans, high school lacrosse jerseys, rock walls, Morgan Freeman.

That's the equation for true wealth.

Physical beats paper. Every time.

Stay Positive,

Garrett Baldwin