What if silver demand reached 1-3 billion ounces? because that is something we will see in our life time.. with the population rising almost by a billion every decade and not to mention the internet is 30 years old, the iphones are only 10 years old.. we are still in the baby ages of technology what if when things get serious, bigger machines, better machines are built that require more silver..
Silver in my opinion, say 80%silver - 20% gold if you don't have any gold. GSR is a way to add to your stash by just waiting for the ratio peaks. For example, in 2011, i sold 5oz's of gold coins to then buy silver coins. GSR then 46.82 (I though it was high then) Then in 2013, I sold another 4oz's of gold coins for silver coins. GSR then 52.23 The 2 transactions got me 434 oz's of silver coins. If I was able to predict today's GSR, I would have waited and did the switch today. Today, 9oz's of gold would have got me about 509 oz's of silver coins. Regardless, when GSR returns to say 40 or below, I will sell the 434oz's of silver (Probably add a lot more of the silver I have in my safe) and then buy gold (if we still can buy gold coins easy in a year or 2). at the end of the day, more oz's in my possession (whether it's gold or silver, and in my opinion, they are both money and currency, always has been for centuries, always will be), the better.
To add to your point, much of that population growth is in countries that have a cultural predilection for gold and silver and growing levels of household wealth. But.... what happens if growth of the world economy hits a wall?
What do you mean if we can buy gold coins in a year or 2? spit it outttt what do you think will happen in 2 years?
What if the earth blows up because that is something we will see in our lifetimes. I hate to break this to you, but silver usage is already at 1 billion ounces and the price hasn't skyrocketed. Notice how little silver is used in electronics and that less silver is used in electronics in 2013 vs. 2007. How do you explain that statistic? And if you remove the investment component, silver usage has declined between 2004 & 2013. Not exactly an explosion in silver demand. Extrapolation is a fool's game. Still waiting on the $10000 ipod evidence. https://www.silverinstitute.org/site/supply-demand/
It never will.. Third world countrys, the people in those countrys rely on children to look after them when there old.. By having children it's like receiving pension or government benefit for them and that is why you see them with multiple children living in tents.. Look at china and India most populated country's in the world hoarding gold and silver not only there governments but people.. especially in india where people buy things using silver. Who gives a shit what happened 1000 years ago or even 100 years ago.. its different now.. we mine faster we consume faster..
I'm not sure people see gold as money any more than they see silver. Yeah silver was cut from US coins in the 1960's but gold was cut out 30 years earlier than that. When I was a kid in the 80's I would sometimes find silver coins in my change (I've found a few even in recent years although far less frequently since I pay for most things with plastic). These silver coins were like a treasure hunt and I thought of silver as money. On the other hand gold coins were things from Nintendo games. Who really made coins with gold? I had never seen one. Gold never came back in change. Just a couple thoughts, Chris
Yes, the past year for me has been a time of re-evaluating what the perma-bulls have been claiming about silver since I heard such claims back in 2012. The fundamentals of supply and demand should be seeing not a growing GSR but a shrinking GSR....as I interpret the data (I could be wrong). And yet we see a growing GSR and what appears now to be an entrenched bear market sentiment....hmmm. As technology improves I think so shall the efficiency of mining silver....perhaps greatly. Supply goes up but is demand really going to keep pace? Apparently, many mines will keep operations going below the price point the industry claims is the make and break threshold. This is what I recall reading some months back. As for $10,000 ipods or whatever, I think ishallperrish might be referring to graphene and the cost of commercial development. I certainly don't know enough about where that stands but I think that this technology will look very attractive to many investors some day soon perhaps and when enough money gets pumped in the cost tends to come down....maybe way down. .
https://www.silverinstitute.org/site/supply-demand/ Thanks for the link dccpa. I read the information somewhat differently to you. It tells me that the supply is on the whole meeting demand with a stronger trend towards individual holdings of silver in jewellery, silverware and investment. I believe that as the economy tanks and demand for PMs increase, there will be no excess supply of silver to meet the demand and prices will increase sharply.
graphene There were more supply than demand only in 2 year's out of 10.. if we are struggling now.. than good luck to us in 30 year's.
What drove the price the past decade? Industrial, or monetary usage? It's rather the opposite: the share of industrial dropped. Does everyone understand the value of gold? Who is your 'everyone'? Central banks? These sell low and buy high. Is that valuing gold? They rather hunt the losses, and losses, from a central banks perspective, are just sponsoring efforts towards selected. Generations grow up that have no concept of silver? On which basis do you claim this? Silver is only bought by age+ ? Statistical data you've read where? Oh right, you said 'my guess'. Well, interesting, I think. This is what Pirocco does: Industrial Fabrication, in million ounces silver. 2004 -608.9 2005 -637.1 2006 -645.2 2007 -656.7 2008 -651.3 2009 -540.2 2010 -643.2 2011 -624.8 2012 -589.1 2013 -586.6 Do you see an increase with the price? I don't. Price is now 4 times the one of 2003. Industrial demand barely changed. What DID then change? Coins & Bars [DEMAND] 2004 -53.0 2005 -51.5 2006 -48.7 2007 -51.2 2008 -187.7 2009 -87.9 2010 -146.1 2011 -212.6 2012 -139.3 2013 -245.6 ETF Inventory Build (positive means it's [DEMAND], negative means it's [SUPPLY] - inverted SI data) 2004 0.0 2005 0.0 2006 -157.8 2007 -54.8 2008 -101.3 2009 -153.8 2010 -132.6 2011 24.0 2012 -55.1 2013 -1.6 What IS the conclusion then? That a share of 30% (very rude estimate) of the industrial demand, quadrupled the average price. All those oldies buying silver apparently don't need your youngsters.
What these numbers (https://www.silverinstitute.org/site/supply-demand/) tell me is that industrial demand has been more or less stable, though photography has dropped, which means that other industrial uses have increased. What has changed a lot is demand for coins and bars, and this demand has of course been spurred by fear in the financial system, a fear which should subside as the economy improves (few people think that all banks in the world will go bankrupt). This demand has also driven the price up. From the supply side, mine production has increased, because as the prices increased, more mines (with higher production costs) have opened. As the price will drop some of these mines will close, and production will drop. Conclusions: I don't really know what to expect in the future. The lower prices should reduce the demand for silver (or lower demand will reduce the price), which will lead to some mines closing down, which will reduce supply. A new equilibrium will be found, at lower output and lower prices. And prices will gradually increase, because of inflation, as they did for the last 100 years? Will they increase faster than inflation or slower than inflation? That's the $100 question.
^ Shouldn't lower prices increase net physical demand, not reduce it as you assert? Does the Silver Institute or any other group publish data differentiating the number of oz of silver coins purchased vs the number of silver blobs (bars) purchased? I'm curious to know if demand for silver blobs is increasing or decreasing as compared to silver coins over the past 10 years. They lump that figure together but it may prove to be an interesting analysis to see that stat broken down. One of the things that prompted me to wonder about that is this thread's topic and some of the comments, especially: "Gold is security. Silver is speculation." Interesting and probably true but I think one could even say that blobs are also seen more as a product to be purchased for security and coins more for speculation. What is your thought on this? If increasingly people feel better about the stability of the world that should mean more speculative behavior since security will be less of an issue for most people....no? If blobs (whether silver or gold) are viewed more as a security product, then it could be of interest to many of us perhaps to learn whether or not the percentage of oz of silver coins purchased is increasing as compared to blobs. I would assume that if we looked at gold, the numbers of oz of coins vs blobs purchased compared to silver coins and blobs would be a very different percentage and perhaps even direction. .
I don't know if "Gold is security. Silver is speculation." To me it sounds more like a funny catchphrase, rather than anything even slightly meaningful. To me it's also a matter of size. I plan to buy $15,000 on PM. That would be 1,500 oz of silver, or 20 oz of gold. Whether I store them at home or in a bank, gold will be easier/cheaper/safer to store. So as the price of both silver and gold drops, gold becomes gradually more attractive.
ETFs and similar products (tonnes) 1997 0 1998 0 1999 0 2000 0 2001 0 2002 3 2003 39 2004 133 2005 208 2006 260 2007 253 2008 321 2009 617 2010 367.7 2011 154.0 2012 279.1 2013 -880.8 <- byebye gold security! Net Government Sales (positive means it's [SUPPLY], negative means it's [DEMAND]) 1997 326 <- let's give them less dollars! 1998 363 <- let's give them less dollars! 1999 477 <- let's give them less dollars! 2000 479 <- let's give them less dollars! 2001 520 <- let's give them less dollars! 2002 547 <- let's give them less dollars! 2003 620 <- let's give them less dollars! 2004 479 <- let's give them less dollars! 2005 663 <- let's give them less dollars! 2006 370 <- let's give them less dollars! 2007 484 <- let's give them less dollars! 2008 236 <- let's give them less dollars! 2009 30 <- let's give them less dollars! 2010 77 <- let's give them less dollars! 2011 -455 <- let's give them less gold! 2012 -544.1 <- let's give them less gold! 2013 -368.6 <- let's give them less gold! Gold is security?
Okay, so let's say for argument sake that size was not that important a factor to you as it is now, and let's say your final decision was silver - would that be in the form of coins (what kind), blobs (higher premium with greater name recognition or unknown but less premium), or .999 silver shot? .
I think bullion coins would be the best (e.g. 1 kg Koala, Kookaburra, Chinese New Year). This way you get a low mark-up over spot price, almost similar to bars, but the price might go up in the future, same as semi-numis. Also, they are more fun to look at, as the coin changes yearly. The problem is that 1 kg coins take up a lot of space, so they are particularly bad in what concerns the "easier/cheaper/safer to store".
