Will Silver Outperform Gold?

We’ve all seen these cash for gold commercials on television recently, yet few stop to think why gold is suddenly in the spotlight. For gold followers, you’ve seen the price of gold increase from $260/oz in 2001 all the way up to $1,170/oz today. The gold rush is on, and smart investors have been buying gold to hedge against inflation.

Gold is a great investment during times of economic uncertainty, but few people are even aware of the reasons why they should be invested in gold. I’m not writing this article to talk about gold though. Silver is what I want to talk about, and that’s because silver is a much better investment. Silver has the potential to return five, ten, or even twenty times the gains compared to gold.

The price of silver per ounce is $18.60 today. Silver was about $4.00 per ounce in 2001. The increase is 400%, and steadily rising. But, you may be wondering why silver is such a great investment. After all, gold made 400% increases in price. Let me share some facts with you.

In above ground inventories, silver is more rare than gold by a long shot. The amount of gold above ground is about 5 billion ounces, while the amount of silver above ground is under 1 billion, with only about 300 million of that available for investment purposes. The other 700 million ounces are for industrial purposes.

Silver is mostly depleted as soon as it comes out of the ground. It is used for electronics, solar panels, medical purposes, and many more applications. Silver is consumed and thrown away in to land fills because the price of silver is not high enough to justify recycling it.

Most of the gold ever mined is in some investment form, available to investors. Silver is simply thrown away, and for silver to become recoverable, the price must go to a level high enough to make that economically feasible. The amount of silver in above ground inventories has been depleted to the point that the price must go up, yet mines extrude less and less as the demand goes higher each year. Even the USGS has stated that silver will be the first element to go extinct by 2020.

Silver really is rare than gold and many economists are planning for silver to reach prices comparable to gold and even higher. It only makes perfect sense that a silver explosion is on the horizon. Some silver experts have stated that owning just 500 ounces about 3 years ago could buy you a median priced home in the near future.

If you are still doubtful about the possibility of silver going so high, then take a look at rhodium. The rhodium price went from$300/oz to $10,000/oz in a few years. This move higher will happen, and if you are still waiting to buy silver it will be too late.

There has been price manipulation of silver and gold for many years now on the COMEX. This price suppression of silver has held the price artificially low for a long time and is about to bust. Certain banks have been illegally short selling silver contracts in order to suppress the price of silver. Some organizations are putting a stop to this illegal activity, and once the short sellers are forced to get in line with the position limits on the COMEX there will be a historic price explosion.

If it is not evident to you that you must be in silver coins, silver bars, silver bullion, or Silver American Eagles then I have not done my job. Invest in silver to protect yourself from inflation. Most people will not listen to this advice until the pundits on CNN are spouting about how high the price of silver is, then it will be too late.

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