The Gold/silver ratio hits 5,000 year high - March 18, 2020

 "I skate to where the puck is going to be, not where it has been."

 Wayne Gretzky    

"Whenever you find yourself on the side of the majority, it is time to pause and reflect."

Mark Twain - (1835-1910)

 "The Gold/Silver Ratio Recently Broke a 5,000-Year-Old Record." OYAT 4/7/20, Seeking Alpha  

On March 18, 2020, The Gold/Silver Ratio reached over 125:1 (Bloomberg).  Why is this significant?  Central banks buy gold, individuals buy silver.  When central banks see a problem, they buy gold and the ratio increases. Then, after the trouble starts, individuals buy silver and the ratio falls.  

Notice the last peak between 1939-1940 in the chart above, Hitler had already invaded Poland at the outset of World War II. 

What are central banks seeing now that caused the ratio to hit a 5,000 year high?

 Global central banks – which ceased buying US treasuries in line with the growth of the Federal deficit in 2015 – have instead hedged their fiat money reserves by purchasing gold.  

“If the entire system collapses, the gold stock provides a collateral to start over.  Gold gives confidence in the power of the central bank’s balance sheet.  That gives a safe feeling." - The Dutch Central Bank 10/13/19