Shouldnt silver be higher?

Discussion in 'Metal Futures' started by peilthetraveler, Jun 16, 2009.

  1. Silver has a reserve base of about 570,000 tons

    http://minerals.usgs.gov/minerals/pubs/commodity/silver/mcs-2009-silve.pdf

    Gold has a reserve base of about 100,000 tons.

    http://minerals.usgs.gov/minerals/pubs/commodity/gold/mcs-2009-gold.pdf

    Why is the price of Silver 60-65 times lower than gold? Silver seems to have more applications that gold too. Someone explain it to me. Why isnt silver $160+ per oz today? Obviously supply says it should be that high. Is silver artificially being lowered or have people just become acustomed to silver being about 1/60th the price of gold so the average joe shorts it when it goes above that?

    Shouldnt their only be a 5.7 to 1 ratio instead of 60 to 1?
     
  2. 1) Don't ever use the word "should" with commodity pricing.
    2) The gold/silver ratio is dynamic, not static/linear. :cool:
     
  3. jimbo320

    jimbo320

  4. "They've been saying this for 30 years."
     
  5. painful as it is to read another PEIL thread

    The market dictates value. It is not something that is fair or unfair.
     
  6. LOL Have i gotten that bad? I'll try to cut back a bit.

    But you all know...if silver does what i want it to, this board is going to be spammed with my "i was right" posts, and "you should've listened to me" posts.

    :D
     
  7. kxvid

    kxvid

    $160+ an oz for silver? Yes theres 10x more silver than gold but way more demand relative to supply for gold. Everybody wants their hands on gold, only gold bugs and precious metal enthusiasts are stacking silver.
     
  8. i actually agree with you silver should and will be higher when people realise the real threat to currencies silver will rise and become used as a currency. i saw a news article where shops were accepting silver as payment in america.

    if there is a weaker dollar (inevitable) silver will become more valuable whether the 60/1 ratio is still there is another question.

    you may have just pointed out the best place to buy at the moment. it is not overpriced but it will protect against inflation so there is still time for the ones who missed the gold rush.
     
  9. Trade what you see, not what you think - Jim Rogers
     
  10. in england silver is charged vat of 15% so this might prevent it from being traded as a investment unlike gold.
     
    #10     Jun 22, 2009