Mexico is crucial to the world when it comes to silver
By ROBERTJ. SHILLLER
We have been highlighting how Mexico is crucial to the world when it comes to silver. This cannot be understated: Mexico just had their version of Hurricane Harvey and they had a Hurricane Katrina. Central Mexico and southern Mexico both had massive earthquakes just this month. If the destruction above the ground is vast and extensive, what does that mean for all those silver mines in the number one silver exporting country of the world?
The implications are a silver supply shortage that could be developing on the quick if mines shut down until damage assessment can be complete. Right now we don’t even know if any collapsed. For example, First Majestic has a mine located just 80 miles south of Mexico City, and that one silver mine has two main areas of underground operations:
Silver production is already in decline and projected to decline further, and if we add significant declines in production because of collapsed, damaged, and halted mines in Mexico, the laws of supply and demand could come back to haunt the cartel for years to come. Paper silver is unlimited, but actual physical silver is something we call precious, meaning it is very valuable and in very short supply already.
And they are at least a week away from any kind of true assessment of damages because right now it is a race against the clock and an all-out effort in search and rescue. We wish Mexico the best in their search and rescue, so if you are a praying kind of guy or gal, a couple extra for the survival of our neighbors is important right about now.