Steve St. Angelo explains why rising debt, weakening energy economics, and an overheated AI boom could trigger a sharp correction before the next major move in gold and silver.
In this Mastermind session, I sat down with Steve St. Angelo of the SRSrocco Report to take a deeper look at gold, silver, copper, energy, and the forces that are really driving these markets. Steve always comes at these issues from a different angle, and one of the things I appreciate about his work is that he gets beneath the headlines and looks at the underlying economics.
One of the biggest points we discussed was the cost of production. Steve estimates that gold currently costs roughly $2,200 to $2,300 an ounce to produce, while silver is around $31 to $32. With prices well above those levels, he believes we could still see a meaningful correction, especially if the AI boom and the broader financial markets begin to unwind. We also looked at copper, where inventories have built substantially and much of the long-term demand growth has come from China. If Chinese demand continues to weaken and the AI story loses momentum, copper could come under real pressure.
But the bigger story is energy. Energy makes the world go around. It drives mining, manufacturing, transportation, agriculture, and virtually every part of the economy. Much of the petroleum growth we have seen in recent years has come from U.S. shale and natural-gas liquids, but these resources come with higher decline rates and generally lower energy returns. Steve's view is that we have increasingly tried to offset declining energy productivity with more debt, and that is not something that can continue forever.
My takeaway is that we may still have a sharp correction ahead of us before the next major move higher in gold and silver. Steve believes that process could begin within the next 6 to 18 months. But longer term, I continue to believe the case for precious metals remains extremely strong. Rising debt, weakening energy economics, monetary instability, and the growing strain on the financial system all point in the same direction. If you want to understand where this system is headed, you have to understand energy.
