GUESS THE ASSET: 6 times more rare than gold and and 62 times cheaper

valuecreator

valuecreator

Well-Known Member
Silver Stacker
A little bit of kumbaya to start the week...

The Coming Silver Price Surge Will Shock The World

I have long stated that when the bull market in precious metals ends and we reach the mania stage, it will be silver's upward paper price movement that will provide the ultimate form of shock and awe.

The reason for this is due to simple supply and demand. Throughout history there has always been about 10 times more silver available in the earth's crust to mine than gold. This simple dynamic created a historical gold/silver price ratio that was about 10 to 1 going back thousands of years. For example, throughout history if the price of gold was $1,387 then the price of silver would be about $138. Today that ratio is at 62 to 1 with gold at $1,387 and silver at $22.21. We will come back to that in a moment.

Over the next few decades I believe that ratio will find a way to move back to balance. Notice that I use a very long term horizon (decades) when saying that ratio will move into balance, and the reason for that is because it takes years from when a new mine first goes into planning to when the first ounces are pulled from the ground.

So what happens if there are investors or industrial producers who want to purchase the silver immediately, and they cannot wait years for when a mine begins to produce?

At that point you must look at what is currently available above ground for supply. This is where the story gets interesting.

In 1950 the 10 to 1 above ground supply ratio for gold and silver was still in place, which can be seen in the chart below. There were about 10 billion ounces of silver available above ground compared to only 1 billion available for gold. Fast forward to today and something incredible has happened. There is now currently 6 billion ounces of gold available above ground with only 1 billion ounces of silver available.

the rest here: http://www.ftense.com/2013/06/the-coming-silver-price-surge-will.html
 
Someone should create some sort of online Silver web based forum where all you silverites can talk about the stuff

but someone's probably already thought about it. :(
 
Clawhammer said:
Someone should create some sort of online Silver web based forum where all you silverites can talk about the stuff

but someone's probably already thought about it. :(
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Sounds like a good idea, all you have to do is come up with a catchy name for it and Im sure there will be some interest...:P
 
salty lemon said:
Excellent post.

The sour bears won't think so though ;)
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If only we were not at the start of a bear market in PM's :D

Great post though. Silver will have its day. More US states passing law to recognize gold and silver as currency, some even allowing payment of taxes and rates in PM's. Others setting up state depositories and then given a debit card to conduct transactions with and bullion transfered at a central point between members.

Also those states that are passing it or looking to do so will be striking the tax off the original purchase of bullion as it changes its classification from investment to currency.

If it ever takes off in a big way, it would perhaps show central banks/planners and government that the people really are FED up with the bad choices these parties are making for the rest of us.

Probably be to late before everyone started looking to actually use this though, even if it is on the books now, most would like the idea but not follow through.:(
 
I'm waiting patiently for the value of my silver to take off like a moon rocket. I hope it'll take off later today
or maybe later this week instead of continuing to drop like a bowling ball in an open elevator shaft.
 
As has been so far, a higher price causes enough former buyers to hit the 'sell' button to drive the price all the way back down to where it came from.
What will make them stop doing this?
 
Pirocco said:
As has been so far, a higher price causes enough former buyers to hit the 'sell' button to drive the price all the way back down to where it came from.
What will make them stop doing this?
Click to expand...

the paper game is dying. the physical game is just getting warmed up. you need to be able to tell the difference.

every day there's thousand more people saying "the emperor has no clothes".

critical mass will come.
 
valuecreator said:
Pirocco said:
As has been so far, a higher price causes enough former buyers to hit the 'sell' button to drive the price all the way back down to where it came from.
What will make them stop doing this?
Click to expand...

the paper game is dying. the physical game is just getting warmed up. you need to be able to tell the difference.

every day there's thousand more people saying "the emperor has no clothes".

critical mass will come.
Click to expand...

Correct.

In a larger respect concerning society on the whole...Everyday more people aren't buying the mainstream brainwashing. There is no way to gauge the speed at which people are realizing they are being lied to, this is because the mainstream media will either lie, skew or simply not cover facts that we should all be made aware of. An example would be that people are realizing all the big TV channels and news outlets are a mostly a joke but they will not report this.
 
Mmm. Perhaps we should a thread or three on the "natural" GSR. I vote shiney! or Yippe for kickstarting it :P
 
Anyone who invests "decades long" time frame is foolish. 7-10 year investment horizon should be maximum. If you are investing for 30-50 years into the future, I mean, most of us will be dead or geriatric by the time our investment pans out !
 
I believe "natural GSR" will play out in 7-10 years.
I wouldn't waste my time on silver to "keep up with inflation" - there are way better things to do if you keep this outlook.

Such a distorted and important market, it's like a perfect storm coming. I don't care if it hits tomorrow or in three years, but it will hit like a mother...
 
I would be greatful if my stack today can fund my new house in 7-10 years time. As of today it would require 5600oz of silver (estimated).
 
Veggie Country said:
I would be greatful if my stack today can fund my new house in 7-10 years time. As of today it would require 5600oz of silver (estimated).
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5600 oz x $23.50 (current spot) = $131,600

You won't get much of a house for that.
 
willrocks said:
Veggie Country said:
I would be greatful if my stack today can fund my new house in 7-10 years time. As of today it would require 5600oz of silver (estimated).
Click to expand...

5600 oz x $23.50 (current spot) = $131,600

You won't get much of a house for that.
Click to expand...

In Malaysia, yes you can! :P
 
Veggie Country said:
I would be greatful if my stack today can fund my new house in 7-10 years time. As of today it would require 5600oz of silver (estimated).
Click to expand...


that funny you would say that, I was running some numbers this morning and I estimate that, in the next 10 years, you will be able to get a property in Australia that would cost you $500K now, for less than 500 oz Ag.

So in purchasing power terms, somebody with a little 1000 oz stack today is already a millionaire. Don't ask me how I got these figures. :)

The sad thing (for them) is that most stackers will not survive the coming volatility.
 
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