Thought experiment - for sake of simplicity exclude other precious metals from existance. Only Gold and Silver ** Gold and silver throughout history in different places of the world, and within different cultures during different periods have set ratios on the Convertability of Gold into Silver which mainly varied between 8-20 oz silver to 1 oz of gold. In the last 50+ years it has gone up to around 100 oz of silver into 1 oz of gold. The relationship of Silver and Gold should ( and will be eventually ) like the relationship of month to a year = around 12 :1 Now a year has 12 months 26 fortnights 52 weeks 104 half week periods - So silver is gaining on gold and the GSR will keep coming down ( long term wise with some up and down whipsaws ) **
Just me , and I'm the first to admit that I am poorly educated, especially so when it comes to emonicomical stuff like this. I can with my admitted limited knowledge, experience and whatever other shortcomings see an even smaller GSR if not a short term reversal for a limited time , even getting to a say 1.5to 2 for a while. I read a lot, It is about the only thing I learnt to do at school before getting the boot after year ten, Catholic private schooling, The associated bad habit's you get from rich kids , actually being from a relatively poor background but parents that sacrificed Etc etc Blah blah . The price of Gold in 2000, The price of Palladium in 2000 http://www.kitco.com/scripts/hist_charts/yearly_graphs.plx http://www.kitco.com/scripts/hist_charts/yearly_graphs.plx What sort of messed up ratio is that ? And where is it now ? People talk about fundamentals and also talk with experience about what they are talking about. As I said I know probably less than nothing about the whole scenario, But GP isn't charging by the word and it's a public discussion forum. One thing I do like to do is work on percentage, I sell some stuff on Ebay, mostly nothing to do with Silver but Ebay charge me a fee for selling there based on listing and final value fee as a total, Paypal also charge me to receive $ as well. It cost's me about 10% all up to sell stuff there. I pass all the cost on and sell for a minimal 200% profit and the customer still comes out ahead even paying for postage compared to my closest competitor. And I buy silver with my profit's. Now back to Silver, Buyers at the MOMENT , as investor's are at a very minimal percentage, miniscule even compared to the total investment market out there, Silver as a percentage of it's readily available reserve is at an all time low. Demand for both industrial and investment Silver as a percentage is at an all time high. Production of silver compared to demand is at an all time low percentage wise. I would put the percentage people worldwide aware of Silver's potential as an investment at around 1-2 percent from what I read, Gold as an investment is probably in the order of 5-10 percent of people aware of it as an investment . The amount of people that are aware today compared to those who were back in 1980 probably has not increased much as a percentage of the population as being aware of Silver as an investment , but just on population alone we have increased from 4.5 to around 7 billion. so as a percentage that 1 % has grown while the supply of Silver has fallen and industrial use has grown by X. I left school early so I will leave the maths to others more qualified. Just My Two Grams Worth...... MMMM probably allowed for too much inflation there huh?
