Silver Infinity, really?

Silver demand continues to outpace supply.

The reason?

Everyone keeps quoting the same one:

Demand for green energy applications.

Applications like…

Photovoltaic cells in solar panels…

Electrical contacts, connectors, and switches in electric vehicles…

Specialized silver-zinc batteries in aerospace, and medical devices…

But the biggest push is for solar panels, which pretty much everyone sees as silver’s deus-ex-machina.

Take a look at the upside potential.

Solar panels have almost become this god solution finally condescending into the world of silver-bugs to prove once and for all that silver is what they say it is.

Don’t get me wrong. I think silver is everything people say it is. It always seems to outperform gold in a recession, and in financial crises’, prices drives even higher.

Silver prices go higher. Especially during recessions, which many people agree the US is already in, and most say will happen soon. But this whole solar panel narrative seems questionable.

The fact that solar demand is creating a disproportionate scale in demand vs. supply… China is investing heavily into solar panels. As well as, the United States. And governments don’t seem to like oil even though they need it. It all points towards more demand.

China, for example is the world’s biggest producer, installer, and exporter of solar panels.

Yet, China is reaching limits on their capacity for installation…

Bloomberg reports:

China Solar Installations Seen Remaining Near Record in 2024

“China’s solar installations will likely remain near record levels this year, but beleaguered manufacturers won’t see another surge in panel purchasing to soak up excess production capacity…

…While last year’s installations shocked to the upside, doubling the CPIA’s initial projection, grid and land constraints make another big jump unlikely. That’s bad news for manufacturers, who are facing consolidation and even bankruptcies as overcapacity drives down prices and profits.”

While capacity may be slowing in China, it hasn’t put solar panel installation projections out of sight in the United States. The same magnificent charts maintain hope for silver’s off-the-chart price projections.

US Solar installations look like they’re on the path to parabolic.

Four years from now, solar panel installations are projected to move up another 30%, or more.

Solar panel installations, electrical vehicles(which are already seeing a decline in manufacturing, and consumer demand), and even silver’s role in aerospace all point to an overvaluation on the demand curve.

Solar panel installations being on the front end of the demand curve, and electric vehicles on the back end of contributing to the demand curve. Again, demand for EVs is slowing down.

Then there is the question of geopolitical conflict and war…

Yes, conflict and war does tend to drive the price of gold and silver up, but how will this effect silver’s demand projections?

Chances are, government resources will be directed away from electric vehicles and solar panel installations.

It’s not like the US military will start outfitting aircraft carriers and tanks with solar panels as nation’s threaten American lives.

No ones going to be asking about how they can “greenify” military operations when war creates scarce resources.

War never changes, but markets do…

And so does supply.

If the green economy slows down for one reason or another, what happens to demand for silver?

Supply increases, and when supply outweighs demand, prices go down.

So, will the green economy push silver prices to infinity, maybe.

But, like we’ve seen in last few years, sometimes a decade of change can happen in just one year.