Thursday, April 17, 2014

Gold, Silver and Common Sense Investing

Supply is tight and physical demand is high for both metals. However, in this category silver really shines. Some of the greatest writers in the bullion field have already laid the foundation for understanding how much above ground silver there really is. Look no further than Ted Butler or Eric Sprott. In short it has been used and abused at very low prices for more than three decades. In the case of Butler, his arguments have been so compelling that he makes a case for there actually being less above ground silver than gold at present time.

There were billions of ounces in January of 1980 when silver reached its all-time historical high of $52 per ounce. Fast forward to 2014 and it is said that there is now less than 900 million above ground ounces available not just for the thousands of applications and critical industrial uses but for all of the world’s total demand.

At today’s price of approximately $20.00 per ounce, 900 million ounces would be valued at about $18 billion dollars. One large investor could literally turn the market on its head. (Store this little tidbit and recall it when you have already purchased bullion and you are trying to convince others to do the same.)

- Source Shanghai Metals Market: