The last few days have been like nothing most of us have ever experienced – or are likely to experience again in our lifetimes.

Panic has spread from the streets of Wuhan to the grocery stores of America’s heartland, from nursing homes to the Federal Reserve Board, from the stock market to the gold and silver markets.

Like other asset classes, the precious metals space is being rocked by rapidly accelerating developments, some of which haven’t occurred for decades and some of which haven’t occurred ever.

These unprecedented times are testing the mettle of precious metals investors like never before.

Gold and silver are meant to provide safe haven from financial turmoil. Safe haven demand for physical bullion has indeed surged. The pace of buying has been so furious in recent days that some dealers are literally running out of product to sell, and the scarcity has driven premiums are sharply higher.

So why haven’t gold prices skyrocketed? For one thing, the bullion market is relatively small compared to the highly leveraged futures market that sets spot prices. Gold can get pulled down on any given day for no other reason than panicked traders need to sell it in order to raise cash.

When comparing gold to other assets, however, the monetary metal is performing exactly as it should during a time of crisis. Gold has risen strongly when measured against a crashing stock market over the past few weeks. It has spiked to multi-decade highs versus both crude oil and silver.

The gold:silver ratio has now entered previously uncharted territory. On Monday it spiked to 116:1. Put another way, a single ounce of gold could buy a staggering 116 ounces of silver.

Never has silver been as cheap to acquire in real terms as it is today. Never has the silver market traded so wildly disconnected from its fundamentals. Never have the silver bullion and silver futures markets diverged so greatly.

Whereas shortages and premium spikes are taking hold in American Eagles and other popular silver bullion products, the opposite is occurring on the exchanges. For example, one exchange-traded silver vehicle, Sprott Physical Silver Trust (PSLV), briefly traded down to a record 10% discount to its own net asset value.

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