Most Popular
1. THE INFLATION MONSTER is Forecasting RECESSION - Nadeem_Walayat
2.Why APPLE Could CRASH the Stock Market! - Nadeem_Walayat
3.The Stocks Stealth BEAR Market - Nadeem_Walayat
4.Inflation, Commodities and Interest Rates : Paradigm Shifts in Macrotrends - Rambus_Chartology
5.Stock Market in the Eye of the Storm, Visualising AI Tech Stocks Buying Levels - Nadeem_Walayat
6.AI Tech Stocks Earnings BloodBath Buying Opportunity - Nadeem_Walayat
7.PPT HALTS STOCK MARKET CRASH ahead of Fed May Interest Rate Hike Meeting - Nadeem_Walayat
8.50 Small Cap Growth Stocks Analysis to CAPITALISE on the Stock Market Inflation -Nadeem_Walayat
9.WE HAVE NO CHOICE BUT TO INVEST IN STOCKS AND HOUSING MARKET - Nadeem_Walayat
10.Apple and Microsoft Nuts Are About to CRACK and Send Stock Market Sharply Lower - Nadeem_Walayat
Last 7 days
Why PEAK INFLATION is a RED HERRING! Prepare for a Decade Long Cost of Living Crisis - 9th Aug 22
FREETRADE Want to LEND My Shares to Short Sellers! - 8th Aug 22
Stock Market Unclosed Gap - 8th Aug 22
The End Game for Silver Shenanigans... - 8th Aug 22er
WARNING Corsair MP600 NVME2 M2 SSD Are Prone to Failure Can Prevent Systems From Booting - 8th Aug 22
Elliott Waves: Your "Rhyme & Reason" to Mainstream Stock Market Opinions - 6th Aug 22
COST OF LIVING CRISIS NIGHTMARE - Expect High INFLATION for whole of this DECADE! - 6th Aug 22
WHY PEAK INFLATION RED HERRING - 5th Aug 22
Recession Is Good for Gold, but a Crisis Would Be Even Better - 5th Aug 22
Stock Market Rallying On Slowly Thinning Air - 5th Aug 22
SILVER’S BAD BREAK - 5th Aug 22
Stock Market Trend Pattren 2022 Forecast Current State - 4th Aug 22
Should We Be Prepared For An Aggressive U.S. Fed In The Future? - 4th Aug 22
Will the S&P 500 Stock Market Index Go the Way of Meme Stocks? - 4th Aug 22
Stock Market Another Upswing Attempt - 4th Aug 22
What is our Real Economic and Financial Prognosis? - 4th Aug 22
The REAL Stocks Bear Market of 2022 - 3rd Aug 22
The ‘Wishful Thinking’ Fed Is Anything But ‘Neutral’ - 3rd Aug 22
Don’t Be Misled by Gold’s Recent Upswing - 3rd Aug 22
Aluminum, Copper, Zinc: The 3 Horsemen of the Upcoming "Econocalypse" - 31st July 22
Gold Stocks’ Rally Autumn 2022 - 31st July 22
US Fed Is Battling Excess Global Capital – Which Is Creating Inflation - 31st July 22
What it's like at a Stocks Bear Market Bottom - 29th July 22
How to lock in a Guaranteed 9.6% return from Uncle Sam With I Bonds - 29th July 22
All You Need to Know About the Increase in Building Insurance Premiums for Flats - 29th July 22
The Challenges on the Horizon for UK Landlords - 29th July 22
The Psychology of Investing in a Stocks Bear Market - 26th July 22
Claiming and Calculating The Research and Development Tax Credit - 26th July 22
Stock Market Bearish Test - 26th July 22
Social Media Tips and Writing an Effective Call to Action - 26th July 22
Has Rishi Sunak Succeeded in Buying His Way Into No 10 - Fake Tory Leadership Contest - 26th July 22
The Psychology of Investing in a Stocks Bear Market - 26th July 22
Claiming and Calculating The Research and Development Tax Credit - 26th July 22
Stock Market Bearish Test - 26th July 22
Social Media Tips and Writing an Effective Call to Action - 26th July 22
Has Rishi Sunak Succeeded in Buying His Way Into No 10 - Fake Tory Leadership Contest - 26th July 22

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Forecast, Silver Will Be Worth More Than Gold

Commodities / Gold and Silver 2011 Dec 31, 2010 - 03:22 AM GMT

By: Mac_Slavo

Commodities

Best Financial Markets Analysis ArticleIt’s shiny, it’s fairly rare, and it has been the world’s de facto reserve currency anytime the S has hit the fan historically. Though it has been prized by civilizations since before recorded history, it’s no secret that there is really no meaningful use for the precious metal gold in comparison to the widespread use of many other metals. Once it is mined it is essentially fabricated into gold bars, coins, jewelry or, at times, sprinkled onto exquisitely expensive desserts in five star Manhattan restaurants.


Gold, it seems, is another faith based unit of exchange. There is, of course, much more faith in gold’s ability to retain value than, say, a fiat paper currency printed out of thin air in the trillions, but in the end, there is no real purpose for it other than to store value based on the belief of others who either have it or want to acquire it.

Silver, on the other hand, is a completely different animal. As explained in the latest mini-documentary from Future Money Trends, silver has a long history of use in practical application. From health and medical related benefits to current uses in industrial application, silver is by far a more useful precious metal than its rarer counterpart.

Some interesting and critical things to understand about silver, and why it may very well become more valuable than gold in the near future are discussed in the video and summarized below:

•The majority of all silver mined is used for consumption, as opposed to use as an investment vehicle
•Since 1980, the above ground available gold stores are up 600%, while above ground available silver stores are down over 90%
•The historical silver-to-gold ratio is 15-to-1. The current silver-to-gold ratio is 50:1 meaning that it takes 50 ounces of silver to purchase one ounce of gold.
•Silver consumption continues to increase as the global population rises and more industrial applications are identified including, but not limited to, uses in medical applications, catalytic converters, solar cells, toll transponders, batteries, cell phones, computer chips, high tech weapons, and RFID chips.
•The silver production deficit will continue to rise. Total global production of silver in 2009 was 710 million ounces, while total demand was 889 million ounces, leaving a deficit of 179 million ounces.
•Since World War II, the US government has dumped over 5 billion ounces of silver into the open market. As of 2010, the US government reserve stores of silver are equal to zero.

For those who follow the silver markets, especially the specific production and consumption levels, it is becoming clear that, at current prices, there is simply not enough silver out there to meet the rising demands (both industrial and investment) from the global population. While we will stop short of predicting “peak silver,” the trend for this precious metals is clearly in the upward direction.

Based on just the supply/demand equations, the price of silver should continue to rise and approach its historical silver-to-gold ratio. Add to that the continued monetization of US debt and printing of US dollars to maintain the perception of an economic recovery, and the instability of global governments, and you can get a pretty good idea of what the long-term trend is going to be.

The 1980 high for silver was around $50 an ounce. We’re currently at about $30. In our view, silver is headed to at least $50 an ounce. Once reached, we believe, for a number of reasons, most of which are discussed in the above video, that silver is headed significantly higher.

As the “poor man’s gold” silver can be purchased in smaller denominations and it is likely to be much easier to transact with in the event of a catastrophic collapse of the US dollar or other currencies.

If you don’t have any silver yet, consider picking up some one ounce Silver Eagles, or “junk” silver denominations like pre-1970 half dollars and pre-1965 quarters.

Hat tip Daniel Visionvictory

By Mac Slavo
http://www.shtfplan.com/

Mac Slavo is a small business owner and independent investor focusing on global strategies to protect, preserve and increase wealth during times of economic distress and uncertainty. To read our commentary, news reports and strategies, please visit www.SHTFplan.com

© 2010 Copyright Mac Slavo - All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Comments

Seth Barani
03 Jan 11, 03:45
On practical use of Silver

While I see that commodity prices may remain strong from weakening dollar, one point about silver seems to be missing in many silver-related articles, which is, its use in the industry. Silver was used in photographic films. In the past decade that use has significantly fallen owing to the arrival of digital cameras. Considering that, silver's present demand appears increasingly similar to gold as a commodity hedge rather than industry requirement.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in