Well that didn’t take long…
In what can only be described as a shocking turn of events, the outgoing administration decided to up the ante in the game of geopolitical instability.
The Wall Street Journal reported on Monday November 18th, that lame duck president Joe Biden OK’d Ukraine’s use of US missiles to target assets inside Russia.
WASHINGTON—President Biden has for the first time authorized Ukrainian forces to use Western-made long-range weapons to strike inside Russia, allowing Kyiv to better defend itself against Russia, according to U.S. officials.
One day later, the Journal reported…
KYIV, Ukraine—Ukraine fired long-range missiles provided by the U.S. into Russia for the first time Tuesday, posing a test for Russian President Vladimir Putin after Moscow’s threats to retaliate for such a move.
Ukraine used the Army Tactical Missile System, known as ATACMS, to strike an ammunition storage facility in Russia’s Bryansk region, a Ukrainian official said. The strike came just days after President Biden gave approval for their use.
Apparently it didn’t take long for Ukraine to start firing at targets once the option got the green light.
CNBC cited Russian foreign minister, Sergey Lavrov’s response to the attack:
“The fact that ATACMS were used repeatedly tonight in the Bryansk region is, of course, a signal that they [in the West] want escalation. And without the Americans, it is impossible to use these high-tech missiles,” Lavrov said at a news conference at the G20 summit, according to comments reported by Tass and translated by Google.
It should also be noted that during this escalation, Vladimir Putin signed a decree updating Russia’s nuclear doctrine detailing when Russia can use its nukes…
The updated document now states that any aggression against Russia by a non-nuclear state, if it’s supported by a nuclear power, will be considered as a joint attack.
So there you have it. For nearly 80 years the US has managed to deal with the USSR/Russia without dropping any bombs on it. Now, apparently in two days, this.
President Biden had routinely stood against the use of any US military hardware inside Russia. Apologists for the president said the shift was likely due to North Korea sending some 12,000 troops to Russia to support the effort. Detractors insist this is an effort to screw the world up as much as possible before Donald Trump takes the oath of office.
Either way, things in the region (and beyond) have suddenly become much more uncertain.
When in Doubt…
Geopolitical instability is one of the major drivers of demand for precious metals. In an uncertain world, fiat currencies can become devalued in short order. Protecting against wild currency fluctuations by buying gold and silver has been the go-to strategy for decades.
We’ve been especially eyeing the silver market which has a number of factors that we believe make it an even better hedge than gold: From factors that make it under priced to its massive industrial demand to its tenuous supply.
We believe all that makes silver a winner even without an impending WWIII.
But these latest developments can only serve to heat up demand for the white metal (and for the junior miners who target it).
As If We Needed Another Reason
There’s yet another war-related reason to expect the price of silver to keep rising… our massive debt.
The war’s been costly in more ways than just geopolitical.
According to the GAO, “Congress has appropriated more than $174 billion under five Ukraine supplemental appropriations acts.”
And Secretary of State Antony Blinken made remarks to the press at NATO headquarters saying, “President Biden has committed to making sure that every dollar we have at our disposal will be pushed out the door between now and January 20th.”
I’m sure I don’t have to tell you, the US doesn’t have that kind of cash sitting around. Which means it’s going to be borrowing to finance its support of the war.
Recently the federal debt eclipsed the $36 trillion level. And currently the government has no limit to the amount of debt it can run up. (The debt ceiling was suspended back in 2023.)
The profligate spending on wars around the world only serves to devalue our dollars even further.
And add to the geopolitical tension.
And build a bigger case for silver…