Ted Butler on A Nervous New World

JulieW · Jul 29, 2011

Interesting arguments on the potential of silver vs gold.

http://news.silverseek.com/SilverSeek/1311611199.php

My sense is that the European debt crisis and the clash over the US debt ceiling and deficit have had the unintended consequence of instilling doubt in the minds of many where that doubt never existed. Confidence is a tricky thing; hard to earn, easy to lose. Perhaps people should have been more concerned about debt and financial matters earlier, but more are currently as a result of recent headlines. This undermines the confidence needed to continue to buy and hold paper debt obligations. Maybe this confidence is not lost overnight, but it does erode gradually and enhances the chance a panic will come at some point. In a genuine financial panic, it is hard for me to conceive how people won't flock to hard assets, particularly precious metals.

I understand that I have just outlined the most popular argument for owning gold and silver, namely as an insurance policy against inflation and financial calamity. This is the argument I have tried to avoid for decades, not because it had no merit, but because it was widely advanced. I had always considered the insurance argument as a bonus and not the central reason for owning silver. I still feel that way, but recent events have made me more sensitive to outside financial factors. It seems to me that as more people are exposed to daily reports of world debt struggles and political infighting in the US, more will become convinced of the wisdom of diversifying away from paper obligations and towards assets not depending on the promise of others. Certainly, price increases in precious metals will only solidify that process.
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and

The most important factor to consider in deciding between silver and gold is the price of each. Because gold is so much more expensive than silver, the dollar valuations of each are distorted. At current prices and the amount of gold and silver bullion inventories in the world, there is more than 120 times more gold in the world than silver in dollar terms. What this means, among other things, is that it takes a lot more money to move the gold market than it does to move the price of silver. That's probably the biggest reason for why silver has been outperforming gold. There is nothing on the horizon to suggest that will change anytime soon.
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Ag · Jul 29, 2011

Ted is the Grandfather of Ag - his 'teachings' were some of the first unbiased lectures which converted me from skeptic to stacker. Any new guys should take the time to find his PDF's and read to realize the possibilities of PM's. Sharing the raging Ag bull has nothing to do with it - simple clear factual information.

Thanks JullieW - enjoyed the read - glad I didn't missed it

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Ted Butler on A Nervous New World

JulieW Well-Known Member Silver Stacker

Ag Well-Known Member Silver Stacker

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Ted Butler on A Nervous New World

JulieW Well-Known Member Silver Stacker

Ag Well-Known Member Silver Stacker

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