With commentators predicting the demise of fiat currencies in favor of asset-backed regional currencies, here are 5 reasons to invest in silver bullion over gold:
1) The current silver to gold price ratio doesn’t align with historical trends. “Throughout human monetary history the Silver to Gold ratio hovered in the 10-1 range until the invention of futures and options trading in metals,” writes silver bull Bix Weir at RoadtoRoota.com. “After the massive manipulation maneuvers by the Banking Cabal the silver-gold ratio now stands at over 62-1.”
2) Thanks to its relatively cheap price point compared to gold, silver’s much more accessible to everyday investors. Lower priced assets are typically subject to more volatility than higher priced assets. A mania in precious metals would likely press silver up higher and faster than gold.
3) Unlike gold, a large percentage of the silver that’s mined is used in unrecoverable industrial products, which prevents the worldwide silver bullion supply from continually accumulating. Industrial demand for silver has expanded in recent years from flat screen TVs to iPads and solar panels. “We’ve seen in the last year the growth in that type of use increase about 18%,” Phillips Baker, CEO of Hecla Mining, tells TheStreet.com.
4) Silver, gold and other precious metals will serve as hedges against inflation if investor confidence in the Dollar or Euro erodes further. Other geo-political problems can also push investors toward safety trades in gold or silver as evidenced by a surge in prices during the Egyptian riots.
5) In dollar amounts, the relatively small size of the silver bullion market makes its price sensitive to institutional investments. If hedge funds and mutual funds begin taking long positions in the silver bullion market, prices would spike significantly.
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