Gold/silver ratio

TreasureHunter said:
It would be great if silver climbed and followed gold to reach an acceptable ratio. 1:20 ratio could mean 80+ USD silver. :D
By taking account of gold's current level.
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Gold is going up because that's what it does in climates like this.
There is little such drive for silver. And as much as people like to think the GSR is a real thing that will always follow some rule or pattern, it's really not, it's just a ratio. Absolutely nothing stopping GSR going to 200.
 
SilverDJ said:
Gold is going up because that's what it does in climates like this.
There is little such drive for silver. And as much as people like to think the GSR is a real thing that will always follow some rule or pattern, it's really not, it's just a ratio. Absolutely nothing stopping GSR going to 200.
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Agree. The GSR is pedestalised as a guide to purchase. It is nothing more than a ratio. Silver is not trading as a PM atm. The investor demographic is not buying it for a number of reasons including a failure to appeal to younger investors (who prefer crypto), older investors in retirement more interested in wealth perseveration than risk, and silver is risky, poor ROI, the great roasting of 2011.

This is backed up by weak bar and coin sales at the Silver Institute, though there is some interest in India, which has a long tradition of affinity to precious metals and also recent paper currency ATM withdrawal restrictions.

While this sounds gloomy overall, the best time to buy is at a low. The main question then is, how long will the low go on for? For silver this can be a decade. If we take 2015 as the end point of the last low (in AUD), only just in the last month or so did we see a POS higher than 2013.
 
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SilverDJ said:
Gold is going up because that's what it does in climates like this.
There is little such drive for silver. And as much as people like to think the GSR is a real thing that will always follow some rule or pattern, it's really not, it's just a ratio. Absolutely nothing stopping GSR going to 200.
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No way GSR will go to 200 for the simple reason because governments will be restricting or taxing gold purchases by then. If they impose even 3% GST on gold, I won't be buying. All governments want to encourage some gold purchases but not at the expense of consumer spending like what is happening in India. They don't even want you to hoard masks, don't mention about hoarding gold.
 
expecting v top with very strong fast spike and down to 76-74 , this is just mathematical idea I could be wrong.
Emergency rate cut and more QE should keep industrial demand going for silver . My minimum target is still 26-28 usd for silver
 
sgbuyer said:
No way GSR will go to 200 for the simple reason because governments will be restricting or taxing gold purchases by then. If they impose even 3% GST on gold, I won't be buying. All governments want to encourage some gold purchases but not at the expense of consumer spending like what is happening in India. They don't even want you to hoard masks, don't mention about hoarding gold.
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The percentage of the population "hoarding gold" in Australia is pretty insignificant.
 
All the GSR nerds be like "When the GSR reaches 1:1, imma sell y'all my silver for equal weight in gold!"
Ok then. But in those market conditions why wouldn't you sell your gold and back up the truck with silver?
Oh, that's right.
 
SilverDJ said:
And as much as people like to think the GSR is a real thing that will always follow some rule or pattern, it's really not, it's just a ratio. Absolutely nothing stopping GSR going to 200.
Click to expand...

The silver to gold mining ratio is approx. 9:1 - that's an important factor to consider. Sure, it's possible we could see a 200:1 price ratio but only by increasing the potential for silver tenfold, or in an environment where supply far exceeds demand for an extended period.
We currently have yearly supply deficits and dwindling reserves of 'above ground available silver'.

I don't read too much into the GSR from a historical average stand point, but from a supply/demand and mining ratio stand point, it makes perfect sense that we will go much lower.
 
To hit a 200:1 GSR, let's say silver drops to $13, then gold must rise to $2600. Or maybe silver remains at $17 while gold rises to $3400. I don't know how much people will be buying those 1 oz queen's beast if they cost $3600 a piece. $3400 gold will totally kill off demand for gold jewellery and gold coins.
 
Yes both bargains but some buy a particular metal in the hope of flipping without taking the spread into account.
 
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