There seem to be those that think the GSR is going to flip and return to previous lows of 40-50ish, and that because of that gold is "overpriced" and will hence plummet. I plotted the 20 year GSR against gold and silver price graph and it doesn't look like gold is terribly influenced by a drop in the GSR. Take the previous GSR ramp-down from 2009 to 2011. Gold kept going up. That means silver simply went up more. The one previous to that, 2003-2007, gold kept going up again. You have to go back to 1997 to see gold go down when the GSR goes down. Silver seems to be the one wagging the GSR dog. Thoughts?
I dont think most people meen gold will go down when they day it is overpriced since it is campared to silver. In other words, when people day gsr will go down cause gold is overpriced they meen silver should go up more than gold. Not that silver will go up and gold down.
Some pumptards and permabull fools actually believe that the GSR will return some day very soon to 1:16. Just saying. .
$16 for oz og gold would be a good deal Just saying P.s. Do not tell me about price of loaf of bread if it happens))
Just spitballing again but trying to bring the gold silver ratio into perspective. There are about 85,000 ounces of gold mined each year compared to 850,000 ounces of silver, 1:10. However, as an investment, gold is purchased in bulk by institutions, governments, banks etc as a store of value, for whatever their reasons. Silver on the other hand is overall industrial with only 200,000+ ounces used as investment, or 1:2.5 . It therefore makes sense to store gold for simply logistical reasons at a current 1:100 ratio, bearing in mind the increased density of gold. But when there is a breakout in gold, there is limited supply plus the price is also limiting. Silver however is cheaper to buy in and 2.5 times more available and therefore silver will rise in price at a faster rate than gold during a breakout. In reality the only thing in common between the metals is that they are precious. Each has its own investment model until the breakout. Gold is Bacardi, silver is Coke, it is not until the Mardi Gras that the demand brings them together.
