It’s shiny, it’s fairly rare, and it has been the world’s de facto reserve currency anytime the S has hit the fan historically. Though it has been prized by civilizations since before recorded history, it’s no secret that there is really no meaningful use for the precious metal gold in comparison to the widespread use of many other metals. Once it is mined it is essentially fabricated into gold bars, coins, jewelry or, at times, sprinkled onto exquisitely expensive desserts in five star Manhattan restaurants. Gold, it seems, is another faith based unit of exchange. There is, of course, much more faith in gold’s ability to retain value than, say, a fiat paper currency printed out of thin air in the trillions, but in the end, there is no real purpose for it other than to store value based on the belief of others who either have it or want to acquire it.
Silver, on the other hand, is a completely different animal. As explained in the latest mini-documentary from Future Money Trends, silver has a long history of use in practical application. From health and medical related benefits to current uses in industrial application, silver is by far a more useful precious metal than its rarer counterpart.
Some interesting and critical things to understand about silver, and why it may very well become more valuable than gold in the near future are discussed in the video and summarized below:
- The majority of all silver mined is used for consumption, as opposed to use as an investment vehicle
- Since 1980, the above ground available gold stores are up 600%, while above ground available silver stores are down over 90%
- The historical silver-to-gold ratio is 15-to-1. The current silver-to-gold ratio is 50:1 meaning that it takes 50 ounces of silver to purchase one ounce of gold.
- Silver consumption continues to increase as the global population rises and more industrial applications are identified including, but not limited to, uses in medical applications, catalytic converters, solar cells, toll transponders, batteries, cell phones, computer chips, high tech weapons, and RFID chips.
- The silver production deficit will continue to rise. Total global production of silver in 2009 was 710 million ounces, while total demand was 889 million ounces, leaving a deficit of 179 million ounces.
- Since World War II, the US government has dumped over 5 billion ounces of silver into the open market. As of 2010, the US government reserve stores of silver are equal to zero.
For those who follow the silver markets, especially the specific production and consumption levels, it is becoming clear that, at current prices, there is simply not enough silver out there to meet the rising demands (both industrial and investment) from the global population. While we will stop short of predicting “peak silver,” the trend for this precious metals is clearly in the upward direction.
Based on just the supply/demand equations, the price of silver should continue to rise and approach its historical silver-to-gold ratio. Add to that the continued monetization of US debt and printing of US dollars to maintain the perception of an economic recovery, and the instability of global governments, and you can get a pretty good idea of what the long-term trend is going to be.
The 1980 high for silver was around $50 an ounce. We’re currently at about $30. In our view, silver is headed to at least $50 an ounce. Once reached, we believe, for a number of reasons, most of which are discussed in the above video, that silver is headed significantly higher.
As the “poor man’s gold” silver can be purchased in smaller denominations and it is likely to be much easier to transact with in the event of a catastrophic collapse of the US dollar or other currencies.
If you don’t have any silver yet, consider picking up some one ounce Silver Eagles, or “junk” silver denominations like pre-1970 half dollars and pre-1965 quarters.
Hat tip Daniel Visionvictory
Updated 12:45AM 12/31/10 – Please see comment below for gold’s various uses in industrial applications.
I fu%&ked up last summer and cancelled out on 100 oz. of Eagles @ 17.00 because it was taking so long to get them. Is it ignorant to get in at $32-$34 per coin now? And no, I don’t want any crisp, uncirculated $10 freaking worthless bills!!!
Mike F.
Is it ignorant to get in at $32-$34 per coin now?
You’re gonna be asking that again at 50 and 100.
I agree JO. I’m baking cake for 40 now….
I cancelled an order of silver dollars and got halves instead – and wish I had borrowed money to get more at the time…get in now while you can…still afford it…because it’s going  to keep going up for a while.
Bix Weir calls for $6K silver – being that it’s five times rarer than gold above ground right now.  That’s if gold stays where it is.
I can see gold going way down, and silver taking it’s place as the big brother
The historical silver-to-gold ratio is 15-to-1. The current silver-to-gold ratio is 50:1 meaning that it takes 50 ounces of gold to purchase one ounce of silver.
Whoops! Think you meant 50 ounces of silver to purchase 1 ounce of gold.
Best bet is to buy while you still can! Price may dip a bit, but would you be able to find any at the dip price?ÂÂ
You can’t see michelle. Gold won’t go down. Silver will come up.ÂÂ
Hello my silver loving comrades. I also love silver as the better investment, and have bought some over the months.
I want to play the devil’s advocate & get all of your perspectives on my concern. Along with a few other view points I have read on precious metals from time to time, there are still those people who strongly believe in the near future, gold & silver won’t be redeemable or the government will feel compelled to outlaw both-  in order to force a new electronic money system (or a new currency) on all citizens. My first thoughts are that when this government gets desperate enough with the fiscal hole we are in, and when I’m already starting to hear about the desperate government speaking about seizing private 401K plans, I can’t help but think that this desperate government just might attempt to prevent us from using any gold or silver later when the financial mess gets worst.
Please sound off with your thoughts.
Said: “The historical silver-to-gold ratio is 15-to-1. The current silver-to-gold ratio is 50:1 meaning that it takes 50 ounces of gold to purchase one ounce of silver.” Shouldn’t that be said that it takes 50 ounces of silver to purchase on ounce of gold?  Just askin, cuz I want in big time on 50 ounces of gold if it costs one ounce of silver. Just saying…
don’t keep posting this kinda BS. Sliver only kisses 49-50 then have a BIG correction…how could Sliver worth then Gold??? yu guys just got no brain to think or wut? Only king owns gold or..yu guys talking about paper Gold??? gimme a break.
Any time silver hits 50, its becomes profitable to mine, therefor the price drops again. people arent realizing the supply/demand is artificial. thats why big players arent touching it sits at 30.
I took a loan on my dollar based 401k to buy silver and gold. The government already has plans on taking your 401k so you might as well take as much of it as you can to buy something like gold, silver or land.
I hope they do eagle, it will double then triple in fiat. 45.9:1 at close today.
Marc, what do you think about buying one once silver rounds?
I say purchase all you can afford above your basic needs.
Thanks for the comments all.
EC and Randy, my bad — correction made. Thanks for pointing that out.
Richard, I think silver rounds are just fine. No need to pay the premiums on the Silver Eagles, to be perfectly honest, though they are nice coins. But I would go with at least a recognizable round, like an Apmex or other common name – that way most dealers will be willing to buy from you when you are ready to sell.
Mike F. – I think Just Observing makes a solid point… personally, I wouldn’t put the farm into silver all at once, but cost-averaging in isn’t a bad idea… If, for example, I had $100K right now and that is all I had, I might go 10% – 20% into PM’s divided up between gold and silver, maybe a little platinum because it’s nice to have. Then, I’d take the remaining 80K and move into other hard assets over the course of the following 12 months — personally, I’d be looking at purchasing bulk dry goods, and decent fire arms (they retain value fairly well also), as well as contiuing to move into PM’s each month.. I’d vary the PM investments, like i would with other hard assets, into silver rounds, junk, and maybe 10 oz bars – as well as 1 oz gold coins… That way, if the price collapses due to a major sell off in stock markets (sell first, ask questions later will be the order of the day for all assets, in my view, if panic sets in) you still have capital to move in at perhaps a 20% – 30% correction.. it happened in ’08 and it may happen again – you never know.
If I absolutely had to do something with $100K right here and now, I would move the majority of that money into PM’s and put the rest into personally held commodities (wheat, corn, other grains, freeze dried food, guns, some survival gear) and any other hard assets you may use on a regular basis. In my view, the long-term trend remains UP for silver.. unless somehow the government decides to stop spending money, stop printing money and start moving AWAY from destabilizing the country, I just don’t see silver dropping all that much relative to other assets such as the US dollar over the next decade. There is always the potential for silver demand to drop a bit due to economic collapse and fewer silver-related products being produced, but any such collapse in demand would be offset by complete pandemonium in currency markets and government instability in general…
eagleclaw – that’s always a possibility – a serious one, I think.
I think what happens there is those with silver/gold hold it underground until buyers become available. Even though the US govt may be confiscating, there will always be demand from international buyers. And, in the event the gov starts confiscating, that means the price is going through the roof (and we are going to be in some serious shit economically, fiscally, socially), so demand globally is going to go nuts for a while. So long as there is a buyer somewhere in the world, there will be a way to sell it, even if that means black market.
I think more likely than outright confiscation – or a possible prelude to it – will be massive capital gains taxes on the sale of gold… Jerry Western, author of Got Gold? Get Gold., and I recently had an email correspondence on this very topic. One of his projections, and one that I agree with, is that it is possible that we will see taxes in the area of 50% to 90% on all precious metals related sales. I am pretty confident that at that point the whole market goes underground, because no one in their right mind is going to want to give that kind of money up to the powers that be. just a thought…
Thanks all.
-mac
Odd… the video states that for every dollar invested in SLV, people invest $7 in GLD. making the paper stock ratio 7:1 whereas the current PHYSICAL ratio is about 46:1.
Now, to me – that means a there are a helluva lot more people investing in (what they believe to be) silver than this video would have you beleve. now, I agree that silver is the place to be – mainly because I can actually AFFORD some – but still, it seems that the video is at least somewhat lopsided in its attempt to give you a balanced view.
Eagleclaw, the government can only control people who ALLOW it. Similarly, a currency will only be accepted in trade if people have faith in it’s ability to sustain value.  Some transactions must be conducted in paper, these are credit situations (mortgages, other loans…transactions with banks, essentially). But, if someone locally wishes to purchase something from me, it will have to be in a currency that will sustain value. Nothing but hard assets comes to mind…
It’s already more valuable to me because I have lots more of it. Love my gold, love my silver.  Love my wife that gets paid in silver every week.
Actually silver has gaines about 33% for the last several years .Were looking at 40 bucks by this time next year .The year after that (2012) were looking at 53 bucks .2013 were looking at 70 bucks . That is if it continues to do about a 33% increase each year . I suspect in 2014-2015 -that we will be lloking at silver at 100 bucks an oz .This is a realsitic approach .Eventually silver will climb higher but dont expect 500 dollar oz silver in the next 5 years, its not going to happen in my opinion until 2020 .But if we get ourselves in another War or Israel goes to War , and Tariifs and currencys devalues, market crashes, economic collapse, martial law , terrroist attack like 911 , disease or plague strikes , EMP, solar activity , or unemployment going up to 40-50% , these are the wild cards .while forcasting prices is uncertain because of such things that is unpredictable .But silver has grown about 33% for each year now , and i suspect it will continue that climb up , slowly but surely . I sure as hell would not be contributing to 401k plans or retirment plans, Id start to aquire silver and gold physically, every paycheck regardless of price ,in a years time ,youll have a little stash .Haveing some is better than haveing none .
Buy Silver !  crash JP Morgan.
“…it’s no secret that there is really no meaningful use for the precious metal gold.
…there is no real purpose for it other than to store value”
WTF? That’s just a bit misleading, to say the least.
For any third graders reading, here’s just a few of the many uses for gold from Wikki:
“…injectable gold has been proven to help to reduce the pain and swelling of rheumatoid arthritis and tuberculosis.
Colloidal gold is used in research applications in medicine, biology and materials science.
Gold, or alloys of gold… are applied as conductive coating to biological specimens and other non-conducting materials such as plastics and glass to be viewed in a scanning electron microscope.
The isotope gold-198,… is used in some cancer treatments and for treating other diseases.
…it is used for the protective coatings on many artificial satellites, in infrared protective faceplates in thermal protection suits and astronauts’ helmets and in electronic warfare planes like the EA-6B Prowler.
Gold is used as the reflective layer on some high-end CDs.
Automobiles may use gold for heat dissipation. McLaren uses gold foil in the engine compartment of its F1 model.
Gold can be manufactured so thin that it appears transparent. It is used in some aircraft cockpit windows for de-icing
…has been used for electrical wiring in some high-energy applications (only silver and copper are more conductive per volume, but gold has the advantage of corrosion resistance).
Fine gold wires are used to connect semiconductor devices to their packages through a process known as wire bonding.”
In the future I envision a discussion – make that an argument – with the IRS when I go to sell some PM. They will tell me I have to pay tax on the profit, and I will tell them PM is another form of currency. If greenbacks depreciate due to govt incompetence, so it takes more of them to equal one gold or sivler coin, why are you calling that a profit? There IS no profit, so it should not be taxable just because the dollar is in steep decline. Then the IRS is going to inform me that they make the rules, they don’t like my snippy attitude, and I better pay up or go to jail. I know I’m right but how can we forcefully make that point? I’m hoping George Soros or Warren Buffet pave the way on this since they have both the means to fight this battle and a far bigger reason to do so than I do. If they don’t come through, does anyone else have ideas?
Comments…..You cant eat gold or silver but I think seeds will be worth more then these shiny metals. visit http://www.bereadytosurvive.com an invest in SEEDS. Feed your families for years when stores can’t
To your survival,
M
Clark, I stand corrected. I’ve added a link to your comment at the bottom of this article.
Thank you for the detailed input.
-mac
Michelle- I have read bix weir’s stuff on roadtoroota…I must say his stuff is very interesting. Although I dont agree with his idea that a group of billionaires will assist in taking down our fiat system, I find his writings to be VERY thought provoking.
M- I agree with you , And let me add that when TSHTF and all currency’s tank , the only thing left will be the BARTER SYSTEM ! You want a box of 22 bullets , well I need 10 pounds of flour so “lets trade!” . this will make gold and silver worthless .
For the months to come we will see things which no financial brain could predict. But generally, gold has the potential of preserving hope or life.
In Crete we experienced the 4 tough years of the German occupation 1941-1945, and then the 5 years of the civil war 1945-1950.
Many households having gold to barter, managed to survive the tough winters. Of course when dealing with black market the ratios are not to your best interest, but still one can manage to survive. In relation to Crete’s products (olives, oranges, goats, and potatoes), people “walked through” the gates and entered the 50’s with relativelly low casualties.
I don’t know how gold will behave in the new era, but it wouldn’t a bad idea to hold some.
Be safe everybody, and happy new year to you and your families.
Manos
Comments…..Ag is meant for consumption, Au is not. So silver
price will raise only when it`s industrial use cease to exist, but
by then gold price will be ten fold higher than now. Silver`s industrial use will cease because it will be forced upon, not by
choice. People will be too poor to afford gadgets that contain
silver. OTOH, gold is money right now, ask any central banker.
Bimetalism may work locally but it will never work in the
int`l trade and int`l market. That position is reserved for gold.
Not platinum, not aluminium, not cooper, oil or whatever.
All those will be barter items, as raw materials or finished goods.
Places like COMEX, LBMA will cease to exist in their current form. Paper wealth will be destroyed. Speculation within nations
will be banned, TBTF banks will be TBTSave banks because no one will trade using them, Russia and China bypassed them and
the USD already. And they stockpile gold. All the industrial use
of silver, in the US is almost nonexistent, there is no industry left
If the producers accept silver payments remain to be seen. But
they may ask wheat or soybeans instead.
Happy new year, folks !
Seedsafe ? ÂÂ
Bunch of overpriced open pollinated seeds. Look in any Johnny’s or Burpee catalog and you can buy the same seed for about 1/4 of the Seedsafe hype.
Also, if anyone plans to buy seeds and just stick them away, you’re gonna have a couple problems down the road IF you every open to use them.
1. The germination rate goes WAY down on a lot of varieties after a year or two. Take Kentucky Wonder green beans, for example…..last year’s seed, you’ll probably see +90%….2 year old, maybe 60-70%……3 year old, less than 50%, and so on. 5-6 years out, and you’ll be flying to get 10%.
AND that will depend on how you stored them…..throw them on a shelf in a warm area, and you’ll see worse germination rates.
2. Folks buying seeds and setting them aside for some ‘future’ garden they will do ‘if they have to’ are kidding themselves.ÂÂ
Don’t think you’re gonna plow up ( you even GOT a plow ? ) a suburban lawn and raise any serious food. You’ll spend many seasons figuring out what works and doesn’t before you get to the point of really raising food. Can you last several seasons ?
We’ve been raising and preserving a fair percentage of our food for 30 years now. I’d hate to tell you how funny the first few seasons were. IF you plan to feed yourself, start TODAY ( it’s near time to be starting broccoli seed in my zone for spring planting ), while the grocery store is still around to cover your screwups.
I like the way you think Big Blue. M, many of us here have 5 gal buckets of seeds already. Come to the light.
great posts. all i can add is be careful of silver rounds.
american silver eagles are the best coin to save. their weight and purity is certified by the u. s. mint. who knows what a silver round really is?  i wouldn’t accept one in barter.
go to the coin buy posts such as apmex.com. the big surprise is that one ounce american silver eagles are worth more than other one ounce silver coins - sometimes much more.
A note on ‘scrap’ silver: The half-dollar coins of ’65-’70 are only 40% silver. Still worth collecting but don’t pay the same as for the pre ’65s.
Comments…..I agree with most of the posts. Silver will be a valuable asset in the future. I am not talking about silver as an investment in $ profit. I believe the dollar is going down the drain. I look at silver as a survival investment.
The Black Market will be running between neighbors/business entities for necessary items.
But in a total collapse, food, shelter and protection will be the main bartering tools. Once your area had gone through the decemation and is starting to crawl out of the dark ages, that is when silver/gold will become useful as a form of barter.
So it is important to make sure that you have enough of lifes’ essentials to live on until better times come around. Only hard work on the whole communities part will bring about the change for improvement.
As far as a storage of seeds goes, there are vacumm packed seeds that can be sprouted years later. Haven’t bought any yet but I do plan on it in the near future.
So keep prepping, it is vital to your continued survival.
I have buckets of seeds/food that will last years. It is wheat & corn that has been harvested in the family farm that is not treated. Many small farmers never buy seed wheat.ÂÂ
I would take a silver round. All should have hallmarks & purity. Have even been shipped a blank silver round by manufacturer. That ring sound is unmistakable! Ever hear a brick/bar ring? ASE’s have a higher premium charge by mint the last few months that is passed along. Everything is relative.
It’s surprising that some many people on the website seem to think that gold and silver will lose their value because “you can’t eat gold and silver”. Ridiculous! They suggest that for the first time in history gold and silver will lose their value in a crisis. Better wakeup! Does gold and silver replace food and water? Of course not, but lots of people have more wealth than can reasonably be placed into foodstuffs. The way you should look at this is to recognize that firstly you will need foodstuffs, etc. to survive, then when you have set aside enough foodstuffs and supplies to guarantee physical survival, what do you do with the excess money? That’s where gold and silver begins to shine. Unless you’re as poor as Job’s turkey, you can’t possibly invest your entire net worth into foodstuffs and supplies.ÂÂ
Big Blue said, “…when I go to sell some PM.”
So don’t sell it.
Use it.
Use it like money.
Try it, offer this choice the next time you have to pay for something – Greenbacks or gold – and see how it works out.
Of course you shouldn’t try that with just anybody, only with those you have some level of trust with, for example, a dentist, if you trust him to put his fingers in your mouth and pull things out, you might be able to trust ’em with the knowledge that you have gold to trade.
I agree Terry. Food, shelter & protection will be something that I will NEVER barter “with”. Food, shelter & protection is for me & my extended family. The people that think they understand real money that do not have as much as they “want”, the less they understand & the more closed minded they become.
Any dentist, jewerly owner, mortician, banker & most farmers know what real money is. Any farmer knows how difficult it is to produce food year after year. They have to deal with mother nature & the bankers. The only sure thing is mud on their boots.ÂÂ
84% up for silver this year. I couldn’t store cotton & palladium is difficult to sell.
Bull!
Silver has never been and is highly unlikely to ever be more expensive than gold.
Cow!
Silver will be more expensive than gold. Economics (supply/demand) & chemistry (Table of Elements Chart). Maybe not in our life time, but it will……. Somebody said earlier that we won’t be able to afford to buy electronics, who is we? The Chinese? Looks like J.P. is trying to control copper now.
Very interesting, informative reads. Thank You all. I’m in an unusual situation, possibly rendering other concerns mute. At this moment I am sitting in a hospital next to my wife, she receiving chemo for cancer returning from remission. The prognosis even. evertheless I have prepped for years. Diversify….a hundred ounces of one ounce silver rounds, silver eagles and other certified mints, Golden State, Sunshine Mint. I will not sell silver, but rather barter with trusted souls in the small town I call home, etc. But also heirloom seeds, a years supply of food, water, water filters, guns, ammo (lots), fuel. all sorts of items, and medications.  I want a certain versatility. I have no intention of thinking any one item is a cure all. But foodstuff, water, medications, shelter and the like take precedence at first. PM’s come later…….and only when you feel secure with your friends and family being safe and well. If enough preppers hooked up a lot could be accomplished by a very few, enhancing survivability. But they have to think like we do here. And I will keep collecting silver eagles as I can afford them…..
For those who want to dollar cost average your way into silver go to
https://silversaver.com/share/43JNH
Don’t forget that lead and brass are precious metals too!
Spend your paper but save your wealth in tangibles and never let go of them.
Gold and silver won’t do anything. It just sits there. That’s the beauty of it!
Forever silver, just purchase it now and never have to pay capital gains when you tell a bill to stick it.
I own silver for value store and inflation protection. I own other real assets = bullets, water well, 4×4 truck = for practical use and inflation protection. How much SorG to own is tough to say – I did get some very good points from this website of a survivalist surviving a SHTF moment in Argentina… not moment… SHTF decade: http://ferfal.blogspot.com/ read it!
Airborne, formation at Mach 2 & RW during FF is relative. 1942, the new half dollars I buy r 90% including the others I’ve purchased the every year here lately.
I’ve seen the ferfal.blogspot mentioned several times before, but never gone to it. Tried your link, RebelYell, but it comes up and says the page does not exist. Hope this isn’t one of the pages taken off the internet!! Can someone else check???
Well, loaded ferfal address into computer and found the site. Not sure why the link didn’t work, but…no problem now.
First if we are just talking about owning the precious metals gold and silver, do buy it as an investment just buy it as “insurance” as a number of writers pointed out above. It is a buy and never sell investment unless you run out of all other assets.
Remember that nothing goes up every year (although gold has gone up 10 straight years) and we are due for a “normal” correction this year which means it could go temporarily to $1200 and silver down to $25 per ounce but who cares. Just keep adding it and a dollar cost average.
I would set as a goal to have 10 to 20% of your net worth in precious metals. Remember this is insurance and the cost of being wrong is very high (paper money worth almost nothing)
1. Sorry in my earlier note it should have said .., do NOT buy it as an investment…….
2. If you are buying gold and silver stocks as investments the rules are not the same as buying the metal itself. This is a completely different topic and would need its own thread.
What good will precious metals be, it will be all about food, water, guns/ammo, fuel, and women ! Period !
Slim- And how will you acquire more food, water, guns/ammo, fuel and women/men for the rest of your life when your inital supply runs out?
Who will trade you food, water, fuel, guns/ammo, women/men, for a piece of metal…? People will be trying to aquire things by any uncivil  means possible…..I don’t see civil transacations for a long time…