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A great deal of attention gets paid to gold, and considering the current price it is certainly understandable.

February 28, 2012 – A great deal of attention gets paid to gold, and considering the current price it is certainly understandable, but the status of silver is a necessary subject for any and all considering adding the security, benefit, and performance of precious metals to their portfolio. Silver possesses properties that set it apart from gold and contribute to its viability in the market. Silver may also be currently grossly undervalued, making it a winning investment in the coming months.

Of course, silver is an industrial metal in addition to being a monetary metal and jewelry. Everyday, a considerable portion of the silver at open market is consumed by industrial demand in such products as cell phones, new cars, and solar cells. Those ounces of silver are never going back to market, meaning they have been effectively taken out of the system in a way gold could never be.

Already there is a gross disparity in the drains on the gold and silver markets, and silver consumption changes and cannot be totally accurately accounted for in every market projection. But gold is a strictly precious metal with investment value that has stood the test of time. It is also consumed in the form of jewelry, particularly in Asian markets where gold jewelry is a form of wealth storage culturally, but this is accounted for in measurements and that gold jewelry will eventually be coming back to market.

Then, there is the historical gold-silver ratio. Since Ancient Rome there has been a correlation between the price of gold and the price of silver that has remained relatively constant. It takes about 15 ounces of silver to purchase a single ounce of gold. Any disruption in that ratio, which has not changed in thousands of years, signals an incorrect valuation. Currently, silver is valued at 50.74 ounces for every single ounce of gold. This is a strong indication that silver is grossly undervalued and therefore a very good buy right now.

The influences in the silver market are slightly different from those of the gold market, but they are very interesting and paint a picture of a commodity that is ready to be bought. The gold price and the silver price are each indicating an undervaluation in the market and an opportunity to take advantage of it while you can.

Shannon King

Senior Staff Writer – GoldSilver.org

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