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Eric Sprott: Why Are Investors Buying 50 Times More Physical Silver Than Gold?

Tyler Durden's picture




 

By Eric Sprott

Why are (Smart) Investors Buying 50 Times More Physical Silver than Gold?

As long-time students of precious metals investing, there are certain things we understand. One is that, historically, the availability ratio of silver to gold has had a direct influence on the price of the metals. The current availability ratio of physical silver to gold for investment purposes is approximately 3:1. So, why is it that investors are allocating their dollars to silver at a much higher ratio? What is it that these “smart” investors understand? Let’s have a look at the numbers and see if it’s time for investors to do as a wise man once said and “follow the money.”

Average annual gold mine production is approximately 80 million ounces, which together with an estimated average 50 million ounces of annual recycled gold, totals around 130 million ounces available per year. In comparison, annual mined silver production has averaged around 750 million ounces, while recycled silver is estimated at 250 million ounces per year, which adds up to approximately 1 billion ounces. Using this data, there is roughly 8 times more silver available to buy than there is gold. However, not all gold and silver is available for investment purposes, due to their use in industrial applications. It is estimated that for investment purposes (jewelry, bars and coins), the annual availability of gold is roughly 120 million ounces, and of silver it is 350 million ounces. Therefore, the ratio of physical silver availability to gold availability is 350/120, or ~3:1.1

Now, let’s examine how investors are allocating their investments between gold and silver. The data below is from the US Mint showing gold and silver sales in ounces:

Table1.gif
Source: US Mint (www.usmint.gov)

As you can see, investors are choosing to buy silver at a ratio to gold that is well above what is available. This uptrend doesn’t show any signs of slowing either. The ratio of the physical silver to gold is both rising and extraordinarily above the availability ratio of 3:1.

We can also use other data such as the most recent issues of the Sprott Physical Gold and Silver Trusts. The last Gold Trust issue in September 2012 raised US$393 million and the last Silver Trust issue raised US$310 million. On the basis of prices for each metal at the time of issue, we could purchase ~213 thousand ounces of gold and ~9.1 million ounces of silver. This represents a purchase ratio of 43:1.

If we examine ETF holdings in both gold and silver, we note that in the period from 2007 to 2012, the increase in silver holdings amounted to 12,000 tonnes, compared to 1,200 tonnes of gold – meaning, investors purchased ten times more silver than gold.

These are only three factual data points to consider, but there are other indications that silver investment demand is way out of line with availability. Our favourite question to the bullion dealers we meet, is to ask the ratio of their dollar sales in gold versus silver. The answer is that dollar sales are equal, which means that physical silver sales relative to gold are greater than 50:1.

A recent news headline on Mineweb read, “Silver Sales to Outshine Gold in India.2” It went on to quote a bullion dealer that “investors and jewelry lovers prefer silver jewelry these days.” As the largest importer of gold in the world, it would be impossible for India to purchase an equivalent amount of silver, as it would require more than one billion ounces, essentially more than the current annual mine production.

While these last two confirmations of silver demand are anecdotal, the statistics from the US Mint, the ETFs, and our Physical Trust issues, are factual.

For the time being, the silver price is essentially set in the paper market where the daily average trade on the Comex is approximately 300 million ounces. An outrageous number when you compare it to the daily mine production of about 2 million ounces. As Bart Chilton, Commissioner of the Commodity Futures Trading Commission stated on October 26, 2010, “I believe there have been repeated attempts to influence prices in silver markets. There have been fraudulent efforts to persuade and deviously control that price. Based on what I have been told and reviewed in publicly available documents, I believe violations to the Commodity Exchange Act have taken place in the silver market and any such violation of the law in this regard should be prosecuted.”3

Which brings us back to the phrase “Follow the money.” In our view, it is almost inconceivable that investors would allocate as many dollars to silver as they would to gold, but that is what the data shows.

The silver investment market is very small. While the dollar value of gold in the world approaches $9 trillion, the value of silver in the forms of jewelry, coins, bars and silverware is estimated at around $150 billion (5 billion ounces at $30 per ounce). This is a ratio of 60:1 in dollar terms.4

How long can investors continue to buy silver at the current ratios when the availability for investment is only 3:1? We are surprised that the price of silver has remained at such a depressed level compared to gold. Historically, the price ratio between gold and silver has been 16:1, when both were currencies. Today the ratio is 55:1, so what are the numbers telling us? We believe this is one of those times when smart investors will be well rewarded to “Follow the money.”

On behalf of all of us at Sprott, I wish you safe and happy Holidays and a prosperous New Year.

P.S. – US Mint Sold Out of Silver Eagle Bullion Coins Until January 7, 2013
The Mint recently informed authorized purchasers that all remaining inventories of 2012-dated Silver Eagle bullion coins had sold out and no additional coins would be struck. Since the 2013-dated coins will not be available to order until January 7, 2013, this leaves a three week void for the Mint’s most popular bullion offering.

1 Sources: Gold data is from World Gold Council www.gold.org, and silver data is from Silver Institute, http://www.silverinstitute.org/site/supply-demand/
2 Source: Mineweb.com
3 Source: Bloomberg: http://mobile.bloomberg.com/news/2010-10-26/silver-market-faced-fraudulent-efforts-to-control-price-chilton-says.html
4 Sources: Gold data is from World Gold Council, silver data is from United States Geological Survey (USGS) and Silver Institute.
 

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Tue, 12/25/2012 - 09:31 | 3094427 Dr. Sandi
Dr. Sandi's picture

They only way you can be overloaded in silver is if you swallowed it.

Tue, 12/25/2012 - 00:03 | 3094171 Yen Cross
Yen Cross's picture

 ( I am tired of having to deal with viruses and malware, every time I visit Zero Hedge/ I just spent 2K clearing my system last week.

  My tech guys did a sweep. They said "Quote; Zero Hedge tries hard to be safe, but you need more protection. ( I'll scan the invoice Tyler).

Tue, 12/25/2012 - 00:12 | 3094179 Tinky
Tinky's picture

Try using a Mac – much easier.

Tue, 12/25/2012 - 00:21 | 3094190 Yen Cross
Yen Cross's picture

APPL @ 500/ Thats last on my list.

Tue, 12/25/2012 - 00:24 | 3094189 Aurora Ex Machina
Aurora Ex Machina's picture

Yen, ditch your boys and employ me. For less than $2k, I could make your system cleaner than a Mormon Virgin: they're ripping you off. 100% fact.

ZH is 100% safe; what isn't safe is the internet in general, and your ISP [man-in-the-middle attacks] and so on and so forth.

Think of it like a knight going into battle; you don't run into the mud and guts and blood without tooling up first. And you don't even go live without some basics.

 

>Browser. Firefox - Chrome is ok, but has Google-widgets all over

>Plug-ins: Ghostery, NoScript, Adblock, HTTPS everywhere, [XXX, XXX - only available to spooky types]

>Firewall: MS version is ok, Zonealarm is ok; professional ones [XXX, XXX you ain't paying me, right?]

> Anti-virus: MSE is ok, there's some decent Russian produce out there; Kapersky pro is about the best

> Anti-spyware: MSE is ok, "Spybot Search & Destroy" is about the best, and freeware [run by one of the internet's old ones, nice guy, do drop him a tip if you use his product]

 

Apart from that:

> Ditch your "tech boys", they're ripping you off.

> You need to grab a ~5 gig or so USB stick [or whatever your personal files come to - probably less than a 1gig], and dump all private data onto it [to be cleaned from a clean comp].

> Then, just fucking nuke your computer. $2k for clearing a system? LOLOLOLOL. Just buy a newer, cleaner [and non-MAC traced] computer for $1k, and you're already saving money. If your computer is older than 18 months, fuck yeah, you just got an upgrade for the same money you paid for your current system.

> Spend $100 [max] having that USB drive checked. And by checked, I mean not by your "tech boys", but by some competent legit peeps.

> Load USB drive onto new computer.

 

 

Bam, just saved you $1k without doing anything.

 

~~ Wonder what I could do for a real problem? Bam!

Tue, 12/25/2012 - 00:24 | 3094195 Yen Cross
Yen Cross's picture

 I like people that "think".  Your offer is cataloged

Tue, 12/25/2012 - 00:34 | 3094200 Aurora Ex Machina
Aurora Ex Machina's picture

Disclaimer - none of this will protect you from the pros, but hey...

 

The advantage is, you'll know when you're being genuinely screwed, eh? Better that than accusing ZH, which is [reading the source code] pretty safe. Not that the people who read it are, though, of course ;)

 

Tue, 12/25/2012 - 00:40 | 3094208 Yen Cross
Yen Cross's picture

  I'll find my way.

Tue, 12/25/2012 - 06:01 | 3094363 smacker
smacker's picture

If you had a NAT Router, some of that anti-[whatever] s/w is superfluous - free or otherwise. And never run ANY program before you've scanned it at jotti or virustotal etc. Running Antimalwarebytes (even the free version) regularly is also recommended.

Tue, 12/25/2012 - 00:19 | 3094187 Pharming
Pharming's picture

Hahaha...For the past few years, when I get home from work, my wife says...you got another package I had to sign for.

I love that.  What is it about getting a package of silver or gold in the mail...it's like a Christmas present to yourself even when it's not Christmas!    

Tue, 12/25/2012 - 00:32 | 3094199 passwordis
passwordis's picture

   I tend to get anxious and nervous these days and feel like I'm doing something that is potentially illegal. I feel like the government is a going to one day send their goons to knock on my door.  This is what America has come to.  Where to hide the stuff, How to make certian I have access to it in the event of an emergency. Not forgetting the safe combination. Letting someone I trust know where to look should something happen to me. It's a doubled edged sword for me.  I have a number in mind and when it reaches that number. I'm out.  I can't wait for that day.

 

That's what keeps me up at night.

Tue, 12/25/2012 - 19:18 | 3095358 Pharming
Pharming's picture

I know what you mean...it's a strange feeling when you know that you aren't doing anything wrong but have a gut feeling that something is terribly amiss.  

I have a book for you...

"The Survivor's Club" by Ben Sherwood.  For some reason...this book started it all for me.  I wasn't feeling right about things in the world, and I thought I was nuts!  

Turns out I am...but I feel better about it!  hahaha

Wed, 12/26/2012 - 10:44 | 3096046 fiftybagger
fiftybagger's picture

Number of what?  Dollars?  That may be a mistake.

http://www.youtube.com/watch?v=sDDXtcG4ZZE

Tue, 12/25/2012 - 00:22 | 3094192 passwordis
passwordis's picture

 The "historic ratio" of 16/17 to 1 does'nt mean much to me. How is is it even remotely relevant what the ratio was when silver and gold were both monetary metals?  For the past 200 years the ratio is 33 to 1.  Silver does something entirely different today. It is an industrial metal. It seems to me that the fundamentals that created a 16 to 1 ratio no longer exist and won't again until the day after nuclear war. 

 The more Eric Sprott talks the less credible he sounds to me. Anyone who references the historic ratio of gold and silver as a reason to buy silver sounds more like a car salesman or a hedge fund manager.

There may be plenty of good reasons to buy silver but I wouldn't include a return to some mythical historic ratio as one of them.

 

 

 

Tue, 12/25/2012 - 01:20 | 3094251 rehypothecator
rehypothecator's picture

The natural abundance in the Earth's crust is about 16:1.  They are being mined at a ratio of about 10:1.  But they are being sold at a ratio of 50:1.  Either giant surpluses of gold are accumulating (as seen by its price which has been dropping for the past 12 years in a row.   No, wait.)  Or the demand for silver will drop precipitously. Or one day there will be a shortage of silver.  

Tue, 12/25/2012 - 13:50 | 3094840 AgShaman
AgShaman's picture

From a list of all commodities traded on the paper casinos....

How many are still priced below their highs from 30 years ago?

Tue, 12/25/2012 - 01:31 | 3094264 dunce
dunce's picture

Silver has an advantage  in a hyperinflation time because you can trade it in smaller denonminations, it would not be wise to cut a krugerrand in pieces as people were wont to do historically, remember pieces of eight. For instance you might get 10 gallons of fuel for an ounce of silver or maybe 10 pounds of cheese and 10 pounds of flour. Do you have a wheelbarrow  to haul fiat around? If you had even fiat.

Tue, 12/25/2012 - 01:41 | 3094273 SgtShaftoe
SgtShaftoe's picture

The thing is with property, you are dependent on the rule of law to keep it. Pms depend on your will and force to protect them. They're portable. Value is much higher in those terms.

Tue, 12/25/2012 - 02:11 | 3094291 silverserfer
silverserfer's picture

whats even more amazing is that shitbrain troll Trav777 hasnt raised his head from his vomit pool to troll around this silver article.

Tue, 12/25/2012 - 12:12 | 3094675 blunderdog
blunderdog's picture

Fuckin' NIGGAS!

Tue, 12/25/2012 - 02:34 | 3094304 Yen Cross
Yen Cross's picture

 Every Union PRICK must be on Z/H tonight! Hey fellas, have fun arresting people, and starting fires/ Douche bags!

Tue, 12/25/2012 - 09:26 | 3094422 Dr. Sandi
Dr. Sandi's picture

Not all the pricks have a union.

Some of them are apparently independent.

Tue, 12/25/2012 - 02:39 | 3094307 vamsy
vamsy's picture

This means that Gold reached its Top. Time for me to book profits!!!

Tue, 12/25/2012 - 11:34 | 3094629 GetZeeGold
GetZeeGold's picture

 

 

Just in time for your profits to be debased by the latest round of fiat printing. Silly rabbit....you don't own real gold to sell it. You keep it around as insurance.

Tue, 12/25/2012 - 02:43 | 3094309 OldPhart
OldPhart's picture


I don't know anything.  All I know is that I’ve had a life-long aversion to paying interest, a dislike of fees, and general misgivings over banks.

I bought my first couple of silver eagle coins back in 1999 at the Philadelphia Mint because they were shiny and featured what I considered the most gorgeous broad.  They were silver proof eagles and they got me hooked. 

I loved the coin, I love(d) Lady Liberty striding confidently, the eagle on the back reminded me of my dad's old Air Force Dress Uniform Cap and the bowling alley of stars reminded me of the ribbon for the medal of honor.  I wasn't a kid; I think I was 39 at the time.  My dad was with me and agreed it did bear some resemblance.

I subscribed to the mint and began to purchase two each of the silver proof eagles and silver proof sets as they were issued.  When they started the fifty states program I added to more silver proofs of those until the series rolled into the national park stuff.  I lost interest in the parks after a couple sets.

Early on I was checking eBay and found that I could buy other forms of silver, at pauper’s prices, such as rounds and bars.  I think I bought about 100 ounces of this stuff, three to ten ounces at a time, for around $4 to $5 each on a plain bidding process.  This went on for about four years until about 2005.

In about 2004 I realized that there were earlier years of the silver eagle going back to, if I recall, 1986.  So I started to systematically fill in the missing dates until I had at least two silver proof eagles for each year.  I’ve maintained that through today.

Then I got to thinking it would be kind of cool to have the birth year ‘silver proofs’ for myself and wife.  That lead to a set each for my sons, then naturally, filling in the missing years and bringing the whole thing up to date.

I got a couple of Morgans on eBay intermittently and I don’t remember paying anything over $15 for them.

Just to be cool, and feel like I was one of the big boys, as I learned a bit about silver/gold/platinum, I bought a bit of gold and platinum.  Being a pussy, I bought one each of 1/10 ounce coins in gold and platinum.  On one drunken night I must have bought an ounce of gold because I discovered I have an ounce coin (no idea what I paid!)

I started lurking on ZeroHedge early in 2008 and learned about silver bullion so bought a tube in 2008, then in early 2009 another tube, then ten coins at the $40 peak, then another twenty coins in June of this year.  I always carry three eagles in my pocket (I figure no matter where I am that three eagles should at least buy me a tank of gas.)

[It’s interesting going through metal detectors at courts or airports.  The ‘are those real?’ questions from awed perverts has a certain self-satisfaction.]

Heeding the advice of ZeroHedge commenters, I embarked on an epic voyage across one of our many local dry lakes and had the misfortune to lose over thirty pounds of my silver collection in congealed desert quicksand.  It was truly heartbreaking and, because it was my own dumb-assed fault, I couldn’t bring myself to file an insurance claim.  I should have known such a risk was apparent.

 I’ll never cross that particular patch of congealed quicksand again…no sir.  I’ll try a different route over it.

Then I hear that in Hurricane Sandy, no one recognized a silver eagle, but they were quite happy to exchange goods for gold, provided that the value of gold was reasonably close to the price of food/gas/water, etc.  So now I begin my campaign in purchasing gold eagles in 1/10 ounce increments.  I have managed to safely set aside a lump of cash (with only cost of inflation losses) that I will use to initiate my gold buying ‘spree’ of perhaps $3,000.  This should become available in late January/early February.

Immediately after receipt of the coins I will attempt my second crossing of that dry lake:  provisioned with a modest supply such as a six pack of MGD and a ham sandwich, along with my gold coin, of course, to re-provision upon success.

I bought silver because I’m a cheap assed bastard and, more importantly, generally broke.  Silver was the only thing I could reasonably buy on a working man’s wages.  I prefer to buy United States Eagles because I have no realistic means or plans to move out of the country and I want my means of exchange to be immediately recognizable to my trading partner.

I have little understanding of the markets, though I continue to learn various interesting theories from ZeroHedge participants such as the concept of ‘free markets’, ‘rule of law’, and some notion termed ‘trust’.


 

 

Tue, 12/25/2012 - 03:40 | 3094332 ebworthen
ebworthen's picture

Damned boating/quicksand accidents.

Heartbreaking to lose your physical to the Earth, but poetic at the same time.

At least the tangibles don't burn or can't be vaporized or devalued by a bald headed PhD of alchemy (Economics).

Tue, 12/25/2012 - 04:47 | 3094345 The Navigator
The Navigator's picture

AND if you got an accurate GPS position in relatively shallow waters, maybe with (even a submirsed) buoy on your Pelican boxes, you might find your stash before the pirates do.

Just plan ahead.

Pelican boxes x lbs before sinking ./. floating value of buoys - weights.............. you'll figure it out, if you want to.

Tue, 12/25/2012 - 07:04 | 3094379 OldPhart
OldPhart's picture

We have no Pelicans, nor floating buoys, here in the Mojave Desert.

Tue, 12/25/2012 - 07:07 | 3094380 OldPhart
OldPhart's picture

I literally grieved for seconds.  My stash just vanished before my eyes.  <sarc>Honestly!</sarc>

Tue, 12/25/2012 - 21:09 | 3095486 Honest_Money
Honest_Money's picture

Silver is cornered to the downside by JPM via their concentrated short position.

Tue, 12/25/2012 - 02:45 | 3094312 Yen Cross
Yen Cross's picture

  First of all, there is massive ammounts of recoverable XAU. Secondly, this tread isn't about metal!

  It's about oportunitity!  Buy the metals Bitchez

Tue, 12/25/2012 - 03:36 | 3094329 ebworthen
ebworthen's picture

Yukon Cornelius dittos ZH'ers.

Silver and Gold, Silver and Gold...

Tue, 12/25/2012 - 06:44 | 3094374 judejin
judejin's picture

100 years ago, everybody in the world understood silver was money and saved in silver.

now, 1 out of 10,000 or less regards silver as money and actually saves in silver.

every year, about 5 million kilos of silver were bought in investment form(bullion and coin. on average, it takes about 500,000 people to buy 10 kilos each to suck up 5 million kilos.

i bought around 35 kilos in 2012 and plan to buy 50 kilos in 2013.

in the not so distant future when paper money dies, there will be at most one ounce of silver for each person. on everage, it'd be middle class salary to make one ounce of silver every month.

in the colonial era in north america, a labourer makes 1/10 ounce of silver for a 14-hour day. but back then, there was 3-5 ounces silver per capita worldwide.

one ounce of silver = one month salary is how we should view silver not its current dollar price.

 

Tue, 12/25/2012 - 08:43 | 3094404 negative rates
negative rates's picture

You feel alright? That's a dollar a day, you can panhandle more than that each day.

Tue, 12/25/2012 - 08:00 | 3094391 Downtoolong
Downtoolong's picture

There will never be efficient pricing via supply demand balance in the PM markets until the fraud of the paper PM markets (which do not really converge to physical delivery) is eliminated, breaking the linkage between the two.

Tue, 12/25/2012 - 09:19 | 3094417 e-recep
e-recep's picture

silver is bulky, takes up too much storage space, is heavy, hard to move around in case of emergency.

Tue, 12/25/2012 - 09:29 | 3094426 Dr. Sandi
Dr. Sandi's picture

Yeah, but you'll be able to spot the guy who stole your silver stash. He's the one with a hernia.

Tue, 12/25/2012 - 09:45 | 3094445 Dr. Gonzo
Dr. Gonzo's picture

Wheelbarrows full of cash have always been heavy too.

Tue, 12/25/2012 - 11:08 | 3094561 cranky-old-geezer
cranky-old-geezer's picture

 

 

Could part of it be silver is far less likely to be confiscated than gold, and is far more tradeable, smaller denominations, etc?

Why is the Fed (via its Wall Street proxies) putting so much effort into suppressing silver prices?   We hear about silver price manipulation far more than gold price manipulation.

With such severe suppression of paper silver, pressure is building for a breakout where physical price leaves spot price in the dust.  I can see $30 spot price when physical is $100 and higher ...which would be closer to the historical 16:1 ratio.

Don't be fooled by a heavily suppressed paper market fantasy.  That's all it is, a fantasy, a make believe paper world. 

The real physical world is going to leave that fantasy paper world in the dust before much longer.   

Physical at these low fantasy paper prices is the bargain of the century.   Get in now before all the sheep out there figure it out.

Tue, 12/25/2012 - 12:49 | 3094735 Mitch Comestein
Mitch Comestein's picture

Ah, the counterpoint is that it is a bubble.  I believe May 3, 2011 marked the bottom of the gold/silver ratio for this bull market.  People were projecting 150 silver that year.  It was absolutely crazy.  I sold 90% of my silver then (april/may 2011)  for gold and it was a phenominal trade.  I told a guy who was selling me gold coins what I was doing and he thought I was a lunatic.  That is when I new I was on to something.  I sold some of the last 10% to a kid who was So SURE that silver was going to the moon.  He said silver was his 'business.' 

Now these massive sales are just the residual effect of the massive price spike.   You have to ask yourself why the price is NOT rising when there are massive purchases of silver.  Could it be that there are massive sellers too?!!!

You may want to consider diversifying your holdings instead of betting the farm on someone who makes his living on selling silver.

 

Tue, 12/25/2012 - 14:38 | 3094942 DosZap
DosZap's picture

Mitch Comestein

ALL IT would take is for ONE Multi Billionaire, to purchase all the Phyzz Silver they could get their hands on, and it would not take multiple billions to do SO, considering how short the CRIMEX supply really is.

I am amazed someone has not already done it.

Tue, 12/25/2012 - 15:44 | 3095068 Cthonic
Cthonic's picture

Because they'd find out, like Nelson and William, that the controlling members of the exchange would just change the rules on them.

Tue, 12/25/2012 - 18:02 | 3095279 Mitch Comestein
Mitch Comestein's picture

Which billionaire is going to risk his/her portfolio on an illiquid market like silver.  It would be extremely expensive to get into the market and bankrupting to get out!  Thus, there is the paradox of silver.   People do not hold silver like gold because no buyers of massive size exsist. 

Tue, 12/25/2012 - 13:27 | 3094797 ZFiNX
ZFiNX's picture

Easy answer: it's harder to confiscate.

Tue, 12/25/2012 - 13:28 | 3094798 tradewithdave
tradewithdave's picture

I was listening to an interview with Rick Rule of Sprott a couple of weeks ago.  Rick was talking about the relatively high rates of interest that junior miners were paying to Sprott in exchange for short-term liquidity.  Rule said in so many words that the junior's management "belief" was not only a testament to their hope of a future rising price (who would know better than a miner??), but nearly evidence of a future rising price because of their special knowledge of the market.

All I could think to myself was the only way to weaken a trust structured like Sprott physical would be to take down the juniors that Sprott is lending to.  If you can't attack the independent physical market (stackers), then attack the value of the in-situ stocks of Sprott's debtors.  In such a scenario the cartel (i.e. TBTF bank paper metals ETF) would be using Sprott's enthusiasm for supporting the industry in their role as lender as a weapon against the same industry Sprott supports.  The banks continue selling naked short paper while forcing Sprott to tighten the noose on the junior miners' flows. 

Could this be one of the reasons for the U.K.'s retraction of uberrimae fidei premise for insurance contracts in 2013? 

What am I missing? 

www.tradewithdave.com

Tue, 12/25/2012 - 14:00 | 3094863 AgShaman
AgShaman's picture

What you are missing is that "traders" are like bankers....they don't produce anything.

They just scalp their way into someone else's pocket

As long as the planet has people that are willing to coil and compress the springs....

The bubbles will continue to balloon and burst in cyclical fashion. Don't wanna play the lotto? No worries, we have a casino to fit your personality and risk tolerance.

Tue, 12/25/2012 - 15:05 | 3094996 AE911Truth
AE911Truth's picture

Why are we buying more physical silver than gold?

Buying and holding physical silver is the easiest way to remove from power the criminals who have taken over our banks and our government. This method is likely to succeed at a lower cost (in resources and blood) than alternative methods.

Collectively, we have sufficient resources to buy enough physical silver to destroy the criminal ponzi. We cannot buy enough physical gold to destroy the ponzi since there is too much gold in
the hands of the criminals (way more than you know).

Once the criminals are removed from power, I pray we have the wisdom to keep them permanently out of our lives.

Tue, 12/25/2012 - 18:13 | 3095287 the_market
the_market's picture

How exactly should the silver price remain so low if physical demand is so overwhelming?

If you are saying that banks accumulated large short positions in paper silver then for what reasons exactly should they have done this?

Tue, 12/25/2012 - 19:00 | 3095335 GMadScientist
GMadScientist's picture

One might expect solar PV panels (a big industrial silver sourcer with high upside growth potential...ha get it?) to have an effect on both the "amount available for investment" and as a price support.

 

Tue, 12/25/2012 - 19:30 | 3095374 Dr. Sandi
Dr. Sandi's picture

Why not combine PMs and weaponry into a single stash?

I'm gonna stock up on Patriot missles. They're full of silver plus stuff that blows things up.

Tue, 12/25/2012 - 21:07 | 3095483 suckerfishzilla
suckerfishzilla's picture

Because they can.

Wed, 12/26/2012 - 01:35 | 3095723 AynRandFan
AynRandFan's picture

Why?  Because gold is too damn expensive.  $17,000 gets you 10 coins.  No thanks.  Nothing is worth that much.  Plus, as somebody said, if you want to cash in a coin after the SHTF, you are going to have to walk into and out of a gold exchange with too much money in your pocket.  Might just be a few criminals hanging around.

Wed, 12/26/2012 - 01:47 | 3095730 jimmyjames
jimmyjames's picture

$17,000 gets you 10 coins.

*************

But only 10 coins gets you $17,000- unless you don't have any-

Wed, 12/26/2012 - 06:08 | 3095837 franklyok
franklyok's picture

Thanks.

Let the Sprot sell it down to 7$, and   I'll  buy it.

Do NOT follow this link or you will be banned from the site!