Prior to the United States Election taking place, the overall sentiment was that if Kamala Harris were to have won the presidency the economy would continue its downward spiral due to the heavily inflationary policies that the Democrats were running on which included debt forgiveness and increased stimulus provided to citizens.  Both of which we learned through 2020 and 2021 cause untameable inflation, and the reason we call it untameable is because since that date countries have been battling with record inflation.  Even as this record inflation has come down and the rate at which prices are rising has slowed, that does not change the fact that deflation is not occurring which means the price increases we saw over the past 4 years are going nowhere, those heightened prices are here to stay and even if we only see 1% inflation through all of 2025 family’s savings will continue to be eroded at an elevated rate.

Now, although the above does not highlight a healthy economy in any way, it would still have been incredibly bullish for gold and silver to have an inflationary president in Kamala Harris take office.  With that said, as you very well may know at this point, Donald J. Trump was elected to the presidency in 2025 and both gold and silver saw sharp selloffs as a result.  This caused the question to be asked by owners of silver and gold, “is the bull market in silver and gold over?”.   The reason is many anticipate Donald Trump to rescue the economy, which, while his policies are certainly more Pro-America, the thought is that the impact should ripple throughout the world economy bringing prosperity to all.  On the surface, this may appear to be true; in reality, Donald Trump has the potential to be even more inflationary than Kamala Harris would have been.  Meaning the initial reaction that inflation would be quelled, and that silver and gold’s bull market has ended is an overreaction and we intend to clearly outline why that is.

First off, let us start by simply looking at the year-to-date price charts for both silver and gold to evaluate how healthy they look based on their performance this year.  As we have learned together, vertical moves in any single stock, commodity, or crypto asset are cause for concern as very rarely, if ever, do vertical movements in price end up being sustainable.  Correction is always imminent which means alternatively, seeing healthy pullbacks in price to test new support levels as the price moves higher is important to establish a strong support base for future moves.  Look below at silver and gold’s year-to-date chart.

What do you notice?  At every new leg higher when new barriers are being broken, silver and gold have pulled back to test a new price support, once tested, they continued higher.  Looking at the far right of each chart when zoomed out to the full year, you notice the drop in price we saw this week and last are merely healthy pullbacks to test new support.  This is in fact positive for silver and gold owners as both assets are proving they have not been moving on fear alone, rather, there is economic support for their moves.  Not to get too into the weeds of technical analysis, but take a look at the chart below, you will see various lines that outline different support levels for silver.  You will notice that silver could still drop to $29 USD/oz and still be in a positive upswing as that is currently silver’s support.

And when zooming out even further, you can see that silver is still FIRMLY within its ‘cup and handle’ set up which historically has been one of the most bullish setups for any asset which should strongly highlight how much more gas silver, and subsequently gold, still have in the tank.

Now that we have covered off the bull case for silver and gold based solely off their chart analysis, let us move to cover some of Donald Trump’s main policies which we will use to highlight the fact that inflation is far from gone, again, which is highly bullish for silver and gold.

The main thing you will hear surrounding Donald Trump and how he plans to re-establish the American economy is by placing 100% tariffs on Chinese goods.  On the surface, the theory here is that this would bring jobs back to the United States that were previously lost to China due to lower labour costs.  However, what is not fully understood by the public is who pays the tariff.  Most believe China is paying the 100% tariff tax and that is why it is viewed as a punishment.  This is wrong.  The tariffs are paid by American companies that choose to import Chinese goods, acting as a deterrent, and this is where this policy shows its inflationary teeth.  We will lay out a simplified scenario below:

Say a pair of basketball shorts cost $10 to make in China and $15 to make in the United States.  With a 0% tariff, an American company only pays $10 per shorts and can sell them for $12 domestically which keeps domestic inflation down due to the American company not needing to buy the $15 American made shorts that would need to be sold for $17 to make money; $5 more per shorts than the Chinese made shorts would need to be sold for.  Now, stick with us here as this is where the rubber meets the road for tariffs being positive for silver and gold owners due to the inflation they cause.

In the same scenario above, there is now a 100% tariff on all Chinese made goods.  That said, China can still make the basketball shorts for $10, and they will, the difference is when an American company looks to source those goods, they must pay a 100% tax or tariff on that good because a tariff is meant to stop American companies from buying Chinese goods, not to stop China from trying to sell those goods.  That would make Chinese shorts $20 to import under Trumps’ 100% tariff law.  So, what is the overall impact?

Now that Chinese shorts cost $20 to import, if a company were to sell Chinese shorts, they would need to sell the same shorts for $24, double the initial price of $12 for each pair of shorts before tariffs, which is highly inflationary as the tariff cost is always passed to the final consumer or purchaser of the shorts.  So, why wouldn’t the American company simply source the good from America?  Well, they can, and they may which would make Trump’s policy on the surface look like it is working as jobs would return home.  However, to avoid tariffs, the American company now must source the American made $15 pair of shorts and sell them for $17.  Still, $5 more per pair of shorts than in a 0% tariff environment.

What this clearly outlines is that tariffs are massively inflationary, and this is only using basketball shorts as one-off example.  China is the single largest exporter in the world meaning all goods imported from China would face a 100% tariff and cause the price of all goods to skyrocket.  The ideal environment for silver and gold.

To finish off, we want to leave you with a thought experiment.  As the United States Dollar gains strength after the news that Donald Trump is now president elect, this will put increasing pressure on other currencies that have already been weakened.  Over the past 4 years the response to this has been record gold and silver buying by various countries to protect themselves, mostly those in or around BRICS+ nations.  Chinese citizen investment in gold coins and bars is up nearly 30% in 2024 and is showing no signs of slowing down.  Russia’s gold reserves now exceed 32% of international reserves toping $200 billion USD for the first time.

Do you think American policy that continues to destroy the purchasing power of national currencies around the world, creates higher international and domestic inflation, and causes a hastened dedollarization effort will ultimately end poorly for owners of silver and gold?  We suspect not.