'Nothing Will Stop Silver'; $100 Just The Start Warns CEO | Peter Dembicki

Key Concepts

• De-dollarization: The decreasing reliance on the US dollar as the global reserve currency.
• Silver Shortage: A growing imbalance between silver supply and demand, driven by industrial use (especially solar panels) and investment demand.
• Precious Metals as Safe Haven: The increasing perception of gold and silver as secure investments during economic uncertainty.
• Supply & Demand Dynamics: The fundamental economic principle driving price fluctuations in the precious metals market.
• Derivatives Market Impact: The potential for manipulation and volatility in the silver market due to the large volume of paper silver contracts.
• Tier 1 Silver (TSLV): A silver exploration company focused on its Kurabaya project in Peru.
• Kilo Silver Grades: Extremely high concentrations of silver, indicating potentially economically viable deposits.
• Jurisdictional Risk: The political and regulatory risks associated with mining operations in different countries.

The Shifting Global Financial Landscape and the Silver Market – A Discussion with Peter Dicki of Tier 1 Silver

The discussion centers around the growing instability in the global financial system, the increasing demand for precious metals, and the potential for significant gains in the silver market. The conversation highlights the diminishing reliance on the US dollar, the emerging silver shortage, and the promising exploration work being conducted by Tier 1 Silver (TSLV).

I. Macroeconomic Trends & Precious Metals Demand

The conversation begins with a broad overview of the global economic climate. It’s asserted that countries are becoming less reliant on the US dollar, with fewer nations purchasing US treasuries. This necessitates the US government printing money to finance its debt, currently nearing $40 trillion, with interest payments projected to exceed $1 trillion annually. This situation is fueling a growing awareness among investors that the current system is unsustainable.

Quote: “People are coming less reliant on on the US dollar…They have close to $40 trillion in in debt. Um their interest rates will soon be a trillion dollars just in interest to maintain.” – Peter Dicki

This realization is driving increased investment in precious metals as a safe haven and hedge against inflation and currency devaluation. The recent volatility in the precious metals market, specifically the sharp intraday spike and subsequent gap down on January 29th, is seen as a consolidation phase before further upward momentum.

II. The Silver Supply & Demand Imbalance

A central theme is the existing and growing shortage of silver. While silver is traditionally viewed as a monetary metal, its increasing demand from the solar industry, electronics, and other industrial applications is exacerbating the supply-demand imbalance.

Key Point: Silver is largely a byproduct of copper mining, and with major copper mines nearing the end of their lifespan and limited new large-scale copper projects coming online, silver production is expected to decline. Above-ground silver inventories are shrinking relative to demand, widening the gap.

Data Point: Silver currently trades around $110 an ounce.

III. Recent Market Volatility & Potential Manipulation

The discussion addresses the unusual market activity on January 29th, where silver experienced an 11% intraday drop followed by a significant rebound. This event is viewed with suspicion, with speculation about potential market manipulation.

Quote: “It was absolutely parabolic move…it happened so fast, so viciously.” – Peter Dicki

The possibility of coordinated short selling by bullion banks to suppress the price is raised, alongside the influence of the derivatives market, where the number of paper silver contracts significantly exceeds the amount of physical silver available. The potential for a short squeeze, triggered by retail buying and institutional investors covering short positions, is also highlighted.

IV. Tier 1 Silver (TSLV) & the Kurabaya Project

Peter Dicki, CEO of Tier 1 Silver, discusses the company’s exploration project in Peru, Kurabaya. The project is located in a highly prospective region with significant silver and gold mineralization.

Key Details of Kurabaya Project:

• Location: Coastal Peru, a relatively stable mining jurisdiction.
• Ownership: 100% owned by Tier 1 Silver.
• Geology: Located near major copper mines, suggesting a favorable geological setting.
• Drilling Results: Previous reconnaissance drilling yielded significant silver grades, including samples exceeding 300,000 g/t (grams per ton).
• Current Focus: Upcoming drilling program targeting the “Kambaya corridor,” an area with higher elevation and less erosion, expected to yield deeper, higher-grade intercepts.

Technical Term: Kilo Silver Grades refer to silver concentrations exceeding 1,000 g/t, indicating potentially economically viable deposits.

V. Investment Strategy & Portfolio Allocation

The conversation shifts to portfolio allocation in the context of rising precious metal prices. The question of whether to take profits on existing positions is addressed. Dicki argues that precious metals should be considered a long-term hedge and a component of a diversified portfolio, allocating 10-15% to precious metals.

Quote: “I think people are seeing more and more um that that the precious metals belongs in in in your portfolio as a hedge.” – Peter Dicki

He also notes that the recent price increases have transformed gold and silver from purely safe-haven assets into more leveraged plays, but emphasizes the importance of understanding the risks involved.

VI. The Role of Mining Companies in a Bull Market

The discussion explores the value proposition of investing in silver mining companies versus holding physical bullion. While bullion provides direct exposure to the metal’s price, mining companies offer leverage to potential discoveries and production increases. Dicki emphasizes the importance of junior exploration companies in discovering new deposits for major mining companies to develop.

Key Point: Junior exploration companies take on the initial risk of exploration, while major miners provide the capital and expertise to bring projects into production.

VII. Jurisdictional Risk & Peru as a Mining Destination

The topic of jurisdictional risk is addressed, specifically concerning mining operations in South America. Dicki defends Peru as a stable and mining-friendly jurisdiction, despite political changes. He contrasts this with emerging risks in traditionally “safe” jurisdictions like Canada, citing potential challenges related to Indigenous land rights and regulatory changes.

Key Point: While jurisdictional risk exists everywhere, Peru has a long history of mining and a favorable regulatory environment.

VIII. Future Catalysts for Tier 1 Silver

The primary near-term catalyst for Tier 1 Silver is the resumption of drilling at the Kurabaya project. The company is poised to capitalize on the current silver price environment and deliver exploration results that could significantly increase shareholder value.

Near-Term Milestones:

• Commencement of drilling within the next two weeks.
• Focus on the Kambaya corridor, targeting high-grade silver mineralization.
• Delivery of drill results to the market.

Conclusion:

The conversation paints a picture of a rapidly changing global financial landscape, with increasing demand for precious metals as a hedge against economic uncertainty. The silver market, in particular, is poised for significant gains due to a growing supply-demand imbalance. Tier 1 Silver, with its promising exploration project in Peru, is well-positioned to benefit from this trend. The resumption of drilling at Kurabaya represents a key catalyst for shareholder value creation. Investors are encouraged to conduct thorough due diligence and consider the potential of silver and silver exploration companies within a diversified portfolio.