Silver has taken over gold as the most rare precious metal, read on and discover why we should buy silver in this current uncertain economy.
Silver mining demand aren’t enough to meet the current demands. Silver is often a by-product of mining copper, lead, zinc and gold. Getting silver is a bonus for mining companies.
Worldwide economic growth mainly in China & India, results in more goods being produced. Silver is the indispensable metal in most electronic goods as it is the most electrically conductive, thermally conductive and reflective.
The declining Dollar With confidence dwindling in fiat currencies such as US dollars and Euros, people and investors are turning to real money which have withstood centuries, such as gold and silver.
A further intriguing fact related to this topic is the rising tide in investing demand – Gold and silver, are also known as commodities. Recently, there have been an increase in commodities demand. Gold is peaking now, and silver, the more neglected real money with gold, will gain investor‘s demand as people realise the gold prices are too high.
Gold/Silver Price Ratio – Gold and silver price ratio have always been 1:16. The current ratio is 1:69. Apparently, there is potential for silver prices to move closer to that of gold’s as silver is becoming more rare compared to gold in the current era.
Demand for gold has bounced back after the downgrade in Italy’s long-term credit rating by the Standard and Poor’s to A from A-plus, indicating a weak economic scenario in the Euro region. Any indication for further monetary stimulus would be seen as bullish for the Precious Metals.
Silver also closed in the green as prices took support from rising gold prices but sharp gains were capped as being an industrial metal it also took cues from movement in the base metals pack. Investment demand for the white metal saw redemption in holdings yesterday by 34.83 tonnes from the iShares Silver trust.
The International Copper Study Group said the world copper market was in deficit by 130,000 tons during the first six months of the year. Supply fell short of demand by 286,000 tons during the same period in 2010. Copper prices came under pressure on Tuesday declined by more than 1 percent on the LME as macroeconomic concerns dominated market sentiments. Prices on the LME touched a 9 – ½ month low as poor global economic prospects led to worries over future demand for the metal.