Why You Should Buy Silver Before It’s Too Late

Kellen Ainey (00:00)
Hi there, everyone, and welcome back to the Ask Andrew podcast. Once again, we are joined by Andrew Sleigh.

Alright, we have quite a slew of questions here, so let's dive on in. If someone is completely new to precious metals, how should they decide whether to start with gold or silver? Is there a rule or principle that has personally helped you gain confidence in owning precious metals?

Andrew Sleigh (00:20)
If you're like the the the multi ten millionaire, hundred millionaire, you're gonna generally plow in with gold and but along the way you need to procure some silver. If you're the average Canadian or American, where you've got, I don't know, let's say less than a million or two million in assets, you you're gonna want to plow into s you know silver coins to get a established position there and then supplement with gold.

To whatever percentage you're comfortable with, and you can basically fine-tune it as you go. So, you know, you don't plow in with nothing but gold and or silver, thinking that that's the way to go, you may wind up changing your mind. So if you're not quite sure, then the lower the dollar amount you're coming in with, the more likelihood you should stick with silver coins. The bigger the dollars you're coming in with,

then you will mix in gold with it and fine-tune to whatever percentage sort of you morph it into. And everyone's going to be different on this case, so I'm I'm trying to have a gear my answer that way. But and then obviously call call us here at Sprott and we can explain these things to you and and help you clear have a more clear picture in your head why why gold what gold is for

Why do we buy that? What silver's for, why do we buy that? And then as you get more educated on this for yourself, then you can work on the percentages of what you want to do.

Kellen Ainey (01:57)
So you mentioned specifically silver coins. Why silver coins over, say, one hundred ounce bars when one hundred ounce bars typically have a better premium over spot?

Andrew Sleigh (02:08)
So right now, historically the premium difference between coins and bars are at historic lows when there used to be a huge savings on hundred ounce bars. And then so that there's a g you know a good time to buy coins for that reason, but the main reason I recommend that first is you need to get an establishment in coins first because that's your transactable money. And if you buy nothing but hundred ounce bars, it's the same problem as having nothing but gold coins.

they're so valuable, how do you how do you buy a month's worth of food? You know, and when we get to that stage where we have t issues with our currency, you're gonna need f small denominations to transact with. And you know, that's so you can't you can't just buy hundred ounce bars and not look at anything else because when this all starts to get a problem

you're going to discover later, maybe I shouldn't have bought nothing but hundred ounce bars. And we have clients that are doing that now and coming back and selling us 100 ounce bars to go back to coins. And that's the expensive way to do that. So while the premiums are low, I would load up on as many coins as you can until you reach your your threshold of what you want. And then if you still want silver play, then go to a hundred ounce bars or whatever size.

Kellen Ainey (03:31)
Okay. Moving on here. How do you assess the relative impact of real interest rates, central bank buying, and fisc fiscal deficits on the long term outlook for gold and silver prices?

How do you assess the relative impact of real interest rates, central bank buying, and fiscal deficits on the long-term outlook for gold and silver prices?

Andrew Sleigh (04:02)
So interest rates are going to continue to go up and that's going to have a real impact on bond yields, which is going to be very destructive to people's savings. The the financial world out there, as we know it, the the advisors and and mutual fund companies and and all those people, they haven't figured out yet that with rising ye rising interest rates, the bond market is actually gonna be the very destructive

effect on people's savings accounts. So the old 6040 play is going to be a catastrophe for those, you know, general investors. We have interest rates that are now, you know, approaching 5% on 30 year bonds and going higher. And that means that your your yields when you try and get out of those positions will be dramatically affected compared to what you bought in at. So for example, if you bought a

30 year bond at 2.5% or something, and now they're at five percent, and you're trying to sell your bond and get out, the fund manager will have to discount the bond dramatically in order to get your position because nobody wants a two and a half percent 30 year bond. So that's gonna be very, very, very destructive. central bank buying is I'm I'm assuming the the question is referring to central banks buying gold and silver. So if that's the context, then

they're loading up while their currencies still have purchasing power to buy the metal. So if you're JP Morgan or, you know, Standard Chartered or one of these other bullion banks around the world and you've got hundreds of millions or billions in cash in your vault, then you don't want to have that become worthless, which is where it's headed. And so the only way to protect that is you need to convert as much of that cash to bullion, gold, silver, so that

When the cash is ultimately destroyed in value, you lose nothing. And that's that's the the crups the crutch of what we've talked about many times before, Kellen, is that I've said buy gold and silver before your currency can no longer buy it. And the banks are doing this on a bigger scale, and that's what we should be doing as individuals. And it's a you know, it takes a long process and sooner or later

the inch by inch will be all at once. And when it becomes all at once, meaning the financial event occurs, then either you're already in gold and silver or you're not, and you won't get in. So this is why it's really important to you know, peck away and buy these things while you can. And gold and silver are also representative of the devaluation of the currency. So that's why they go up.

Fiscal deficits are going to continue to skyrocket and they're going to send money on to everything they can. And I'm addressing most countries in the West. I can't even s I don't even follow or worry about what the East is doing necessarily. But in the West it's very clear that, you know, we want to expand war, we want to have every program on the planet, we want to build in Canada, we want to build a a fifty billion dollar high speed train from Toronto to Ottawa. That's ridiculous. You know, anything they can throw a lot of money at.

and create from from nothing. They're spending like drunken sailors. And that's gonna skyrocket the deficit, which is also devaluation of the currency. If in every country, the US is the same way. and all of Europe. So the it's a race to the bottom right now is what's going on globally in every currency. And I I want to repeat this. It is a race to the bottom in every Western currency, if not all the world currencies. So

They're all gonna have real problems and you're either already in gold and silver when the problem arrives or you're not. And you'll be stuck out of the system. So this is why the going back to the banks, countries, they're all buying gold and silver while they can before the system shuts down, whatever whenever that is exactly. So ultimately, because of deficit spending, that's devaluation of the currency, and that gold and silver will have no choice but to go up.

and up and up as these inflationary policies that the governments are hell bent on doing continues to get you know much worse, which means the purchasing power of the dollar will get much worse.

Kellen Ainey (08:41)
Okay. Wow, I think we covered each basis of the question there. So why don't we move on? Let's kind of take a step back here and go more so from a consumer standpoint. What do you think is the biggest mistake people make when they first start buying physical gold and silver? Looking back at your own experience, if you could go back in time, is there anything you would do differently?

Andrew Sleigh (09:07)
yeah, I I did a mistake when I started off 'cause I I knew I knew where we had to be. I knew that I needed to get into metal and out of the fiat financial system and but I didn't know the first thing about what particular metals and sizes I should buy and I started off buying hundred ounce bars of silver. I bought seven and I thought, these are cool, these are huge and they're heavy and they're all this and whatnot.

And I was watching a whole bunch of stuff on YouTube with guys that have been stacking for decades. And I thought, okay, I don't have time to learn th the hard way and the long way for myself. I need to listen to people that have been stacking for decades and glean from their experiences to help speed up my opinion and knowledge. So these these guys that were

that I was listening to were talking about for the and this is again aimed at the smaller client, not people that are in the tens of millions. the they were suggesting at that time that when you're starting off, you buy nothing but coins to get your established position and then you can work your way up as you don't want any more coins. So if you have way too many coins and you don't want any more, then it's like, you know, ten ounce bars, a hundred ounce bars and and whatnot.

many opinions out there have been, you know, an ounce is an ounce and a variety of sizes for a variety of uses. And that might work out that way, but an ounce is not an ounce. And I've I've had that staring me in the face several times that changed my point of view on that. And that is I used to buy whatever coin was cheapest. You know, an ounce was an ounce. And later I learned that.

Not that that was a big problem, but I came across situations where people would only barter if you were giving them a maple, a silver maple coin.

Kellen Ainey (11:14)
Okay.

Andrew Sleigh (11:15)
And so then I realized it's not what I understand about silver, it's what it's whom I'm bartering with understands about silver. And I better have some of the things that these other people want. Otherwise I won't get what I want. So luckily in the last three years, premiums on maples, silver maples have been so low historically that it's been very easy. They've been the same price or cheaper than most of the coins on our site. When they historically are like

two or three dollars more than all the other coins. So that made it easy for me that I would just for the last three years been stocking up on maples. And I'm not changing what I bought for other coins. Like I have generic rounds and I don't know, six or seven different types of coins I have with myself. I'm not going to change those, I'm not going to worry about them because I will come into situations where people won't be concerned about what

type of coin it is. They're already veterans. They've already been doing this stuff. They understand it. And they're like, hey, just as long as it says one troy ounce, I'm good. Then I'll give them a generic round. And if the next person says, you know, I don't really know much about this stuff. I'm only f comfortable with silver maples because they're the legal tender of Canada. Or in the case of the United States, they're only comfortable with the Silver Eagle, then you better have some of those. And so I'm I'm very thankful that last few years

It's been very easy to pick up maples than buying anything else. And so when the premiums go back up and maples are way more expensive perhaps than other coins, then I may I may start to buy some other coins again. But we've been very fortunate to have that position for the last three three, three and a half years. So what I what I did with my hundred ounce bars, I bought these bars and I discovered okay, I'm in the wrong spot at the moment.

And I needed to get coinage first, in my opinion. So I took the bars back to the my friend's shop local to where I live, where I got them. This is way prior to me being here. It's brought. And he took them back and we I bought coins and took those home and I haven't I haven't come I haven't found my way to get back to billion hundred ounce bars yet.

Kellen Ainey (13:35)
Fair enough. Okay, so I feel like that really covered all bases of that question as well, so why don't we move on? This one's gonna be a little bit more specific to silver. Given silver's dual role as both a monetary metal and an industrial commodity, how do you see new how do you see trends in renewable energy, electrification, and global manufacturing influencing its valuation relative to gold?

Andrew Sleigh (14:05)
So because of the commercial aspect and demand of silver, you're gonna have huge pressure on on getting silver in the future. And you know, what does that mean in a we'll use the word free market system where there's the laws of supply and demand. And we know that the powers of B do a lot of manipulation and all that and you know, hence where we are now for the price as an example. But

There's you know the companies need this stuff. The the electrification is a you know they they want to shut down fossil fuel energy all over the place and and promote it all to go to electricity. And then you have wars breaking out all over and the expansion of wars, which all warfare requires huge amounts of silver. you have all the other automation.

that's being generated and created and built that, you know, there'd be less humans in all the different jobs and more robotics. Everything is going to be, you know, wanting to come after silver for commercial use. And then you have, of course, as people start to well, more and more people that I I've experienced and perhaps yourself as well, is people are calling going, you know what? I'm not comfortable holding my medals at the safety deposit box at the bank anymore. I don't trust

what's going on and I don't think the banks are safe anymore. And they're getting antsy on their own and calling companies like us to say, you know, I would like to have storage, you know, at Brinks. So you're gonna have more people waking up, which I think is happening a little bit, that the financial system as they understood it, you know, in their lives and is is not becoming as believable as it used to be.

you know, the the credibility of the Fed and our governments is being destroyed every day by the the real mismanagement of the public purse of the countries. So governments are spending like drunken sailors, and as a result, we're seeing our grocery bills going up and up and up in dollar terms because our dollar buys less and you know we're in debt beyond our eyeballs. So people that are following any of this stuff to any degree.

Are starting to put these dots together in a line and say, hey, you know what? This is not getting better. This is they don't know what they're doing at the government level. They're just saying things like this, like, I don't have any confidence in what the Bank of Canada is doing anymore. I don't have confidence in what the Fed's doing anymore. And they're starting to look for alternatives. And I think that's what was going on to a large degree in January of 2026, which is why they slapped the market down so hard because there was a big groundswell of people.

That were now starting to wake up and go, I I don't want to be in this market anymore. This is this is all a facade. And then they hammered the market down to shove everybody down, back down their holes and and back into their caves and homes and whatnot and and you know, say, no, metals are volatile and and unsafe and all that nonsense. So I think that that we're gonna have huge demands.

in the future, as, you know, even one more half a percent of the population wake up and want metal, that means metal is almost sold out on the retail level. And that's you know, that's not good for the public that don't have any.

And that's why I mm

Kellen Ainey (17:46)
Well, we even s we even saw

that earlier this year, right? It kinda went from it the demand for silver tr tripled, tripled at least. And no one could get their hands on silver maples, hundred ounce bars, anything. So it really does happen

Andrew Sleigh (18:02)
Yeah, I mean it

Kellen Ainey (18:03)
within what feels like a week.

Andrew Sleigh (18:06)
Yeah. Well there's you know, we remember in January, you know, going into the end last week of January, if that had continued on for another few weeks, you know, we were starting to wonder how many more maples we could get from from the suppliers, you know, and our demand was greater than what w what we could get. And that means rationing maples or or we're sold out. And that's g that would be with everybody across the board.

So it doesn't take very much and the but general public have no idea about this. So they just you know, they'll wake up one day and say, I guess I need to buy gold and silver and they c phone, you know, they just Google it or whatever, and everybody they call is sold out. And that

Kellen Ainey (18:49)
Exactly.

Andrew Sleigh (18:50)
that's when the f the the fairy have has left the dock. And and you don't want to be anywhere near that situation when this happens. So so

Price wise, because of all the demand, we're in the scenario that sometimes gold's going to lead this perhaps upward. but in these last stages, silver typically outperforms gold to a three to one ratio. And it's not even about the performance, really, in my book. It's really what you can use and barter with. So if you're thinking about, well, I'm gonna buy silver because it will outperform gold, you're still thinking as an investor.

And that's okay, but you know, what are you gonna do when it does when it does its three to one of performance? Are you gonna sell silver to go back to currency? Like, you know, people call up and go, I want to lock in my gains and go back to money. And I'm like, Do you realize you're selling your physical metal to go back to paper currency that has no value? How does that lock in your gains?

And then they think about it and they're like, I think you're right. Now I said if you're just doing it temporarily and then you want to buy back in again, that's a dangerous game, but that's yours to play. But if you're thinking about, well, I'm just going to lock in my gains and go back to currency, and then all of a sudden the market does, you know, explode and and the financial system has problems. Now you're on the sideline in currency. Now you can't get back into metal. So there's many analysts out there that have said, you know.

If you want to trade medal by the ETFs, if you want to if you want to preserve your wealth by the physical.

Kellen Ainey (20:29)
Well, exactly. We've even had clients I've had that discussion with clients many a times, right? It's if you're looking to trade, if you're looking to get in and out of the metals, the physical side of it really isn't for that. It isn't for those quick

Andrew Sleigh (20:43)
Not really. No.

Kellen Ainey (20:44)
investments, those quick flips. You're gonna get one, you're gonna get eaten on the premiums, and two, it's just not really even what the I know you said everyone's thinking like an investor, but it's not really what the investment is meant for at the same time.

Andrew Sleigh (20:57)
The physical is is first and foremost for preservation of wealth so that when the system has a real problem, you already have wealth in your possession and or under your control and it's outside the system. So there's no conversion of metal necessary. It's already money. So when you o when you own an ETF, you have to be able to convert it back to dollars to be able to buy the metal or buy whatever you want. With metal, it is money.

And you could go and barter with people and pay for stuff in gold and silver. And I've you know, people say, well, that's not possible. It is possible. I've been talking to clients for four years that I can think of that have already been doing this stuff, you know, hit or miss in various situations. And it's not common. You're not gonna go down to the the normal grocery store and loblaws and and you know, whoever in the States and and offer silver for some groceries. That's not gonna happen today.

But you could go down to an ethnic grocery store, Filipino, Asian, Lebanese, Middle Eastern of some sort, and go in and chat to them a little bit and you pull out a coin and they'll say, Yeah, I'll I'll sell you the groceries for that. 'Cause they understand silver and gold. In fact, I was getting my shoe shines at the airport in Toronto and I offered the guy as a fun thing, would you take silver for payment?

He's like, Yeah. I have pulled up

Kellen Ainey (22:27)
Well I mean hey yeah

Andrew Sleigh (22:28)
I pulled I pulled one out of my pocket. He's like, my god, you even have one on ya I said, It's too much value for one shoe shine, but I just wanted to sort of play the scenario. And he's like, Yeah, I would do that.

Kellen Ainey (22:41)
Well, no, exactly.

It it still has a position as a barter tool, right?

Andrew Sleigh (22:46)
has value. You know, no question. So that was a long ramble that I think we're way out way beyond what I even remember the question was. So anyway, next question.

Kellen Ainey (23:01)
So this is our final question. Where are you seeing the most compelling opportunities or risks in the precious metal market today? Particularly when considering mine supply constraint, investment demand, and geopolitical uncertainty.

Andrew Sleigh (23:18)
So

I don't see risk in purchasing physical metal.

Kellen Ainey (23:27)
Okay.

Andrew Sleigh (23:28)
I do see risk in and again this is just my opinion and the way I look at it, that could be totally different for lots of different people. So but I do see risk in buying miners or stuff that's you know in the stock market and all that. the mining sector, even though there is great

explosive moves potential and you can have great gains from it. You know, i.e. Eric Sprott has made a fortune in that stuff over the years. That's all documented and and you know, like no argument for me on all that. But today, you know, he's carrying two to five percent of his portfolio in mining stocks and eight billion in physical gold and silver. So where does he view that? Well, just from his percentages, he views the the

equity s sector of mining to be volatile and risky and he's prepared to write all that off. Cause he has all of his wealth in physical. He has no losses. So I think the bond market is a catastrophe waiting to happen. I think holding currency is a catastrophe waiting to happen. owning anything in the f stock market other than and I'm not a

professional in that regard at all, so take it with a grain of salt. But I think you have more risk there than what the vast majority of people understand. And I'm not addressing the day traders here. I'm only addressing the average, you know, Canadian American that you know sort of buys whatever and sits and holds it for a while. I think those people are potentially going to get slaughtered when the system breaks because they're not in front of the computer doing day trades all day long and getting out before anything it

really happens. so I see risk all over the planet. I mean, we know now from from news and I don't think mainstream's saying too much, but the Japanese bond market is collapsing. And to the extent that America is getting involved to prop up the yen via buying European Euros to then buy yen. They don't even want to do it American dollar to the yen because they don't want punish the yen more.

And I don't know I don't exactly understand how that works and why they would do it, but I do understand the language of the discussion that it's so bad that another country is intervening so that Japan doesn't collapse their currency. So we're we're at that tipping point where things are so volatile and ready to go off a cliff, I don't understand why anyone's in the market other than a day trader.

So there's risk everywhere. It's not like there's no risk, I guess. I'm gonna correct myself. I won't say there's no risk on metal on buying gold and silver. You you avoid the counterparty risk, you avoid the devaluation of the currencies and and you avoid all of the really nasty stuff that's gonna come. but there is the little risk that you know, you buy gold or silver at X amount of dollars.

And it does have cycles going up and down. And so that's why it's important to sort of buy on dips and don't try and buy on the on the when it's moving, you know, at a high like people did in January. But that's hindsight. Everyone can do that when they look backwards. And so if you had to raise some cash to to pay for something, you know, you're living off of your assets. And at the time that you sell gold or silver.

In theory it could be lower in price than what you paid for it. So in technically you would have a loss there on paper. But if you're nibbling along the way and preparing, you know, then that's you know, that's a minimal risk. And you're only also selling exactly what you need to to raise money for. So if you're if you have an unforeseen bill that's five grand, you're only selling five grand worth of metal and you've had, you know, a couple of hundred grand worth of metal, that's in my opinion,

you know, non issue. but that is, you know, that is a very small scenario.

I guess the other scenario is if there's a break in or if somebody steals it, loses it, whatever the case is, you have a gold coin in your pocket and you empty your trousers and and the coin falls out on the ground or whatever. So, you know, there's those kinds of scenarios. but if you don't talk about this stuff and nobody knows you have it and nobody knows where it is, you know, people store stuff at Breaks, people store stuff in all different places.

Then you know, you can sleep pretty well at night because the risk there is far less than holding metal at a safety deposit box, because we know definitively the banks will close. And when they do, your deposit box is no longer available to you. You know, you'll lose it. And just check the wordings on the bank safety deposit box. The bank is not responsible for the contents. We've talked about that several times. So

That's how I view it. Now, day trading, great for those that do it. For people that are not sophisticated, nibble away and buy silver and gold if needed. and and hold as much there as you don't want to lose with the money in the system. Have some cash outside the bank, you know, literally like ten K, five K, whatever the scenario is for you, in cash in a drawer, in a in a in a gun safe, whatever.

so that if the system does shut down on Monday, you've got immediate cash to use stuff with and then if it stays broken then eventually within weeks or a month or two, silver and gold will take over.

So that's my that's my sp answer to that question. So

Kellen Ainey (29:39)
Well, that was a fully loaded answer, I'll give you that.

So that does sum up the questions I have today. Once again, as I always ask you to do, can you please give the best way to contact yourself, both via phone and email?

Andrew Sleigh (29:55)
Sure thing, thanks. so anybody that needs additional help they can call the toll free number on our website one triple eight eight six one zero seven seven five my extensions two hundred thirty and you can email me at death of the dollar at sprottmoney.com

Kellen Ainey (30:14)
Well, perfect. Thank you, Andrew, once again, and we will have you on shortly.

Andrew Sleigh (30:19)
All right. Thank you, Kellen. Have a good day.

Kellen Ainey (30:21)
Likewise.