I have already laid out myriad
reasons why silver is perhaps the MOST UNDERVALUED MARKET ON EARTH.
Moreover, I recommended higher exposure relative to gold; due to the comically
high gold/silver ratio; advice, by the way, I personally took.
For hundreds of
years, the gold/silver ratio held around 16:1; often fixed via
Precious Metal currency standards, and sometimes in freely-traded
markets. Said ratio was loosely based on the fact that for centuries,
the ratio of metal taken from the ground was roughly 16 ounces of silver for
every ounce of gold.
However, since the ENTIRE
WORLD abandoned the gold standard in 1971, this ratio has mysteriously risen;
no doubt, due to the incessant MANIPULATION of PAPER PM markets. In
silver’s case, its relative scarcity has obviously caused the Cartel
to deem it “public enemy #1; and thus, suppressed it even more than
even gold; which is probably why it is the ONLY commodity to consistently
have a “Commercial” net short positions for more than 20 YEARS…
Not only have essentially
ALL global silver inventories been exhausted by industry – as opposed to
gold, where nearly every ounce ever mined still exists…
…but silver production is
depleting dramatically faster; yielding a 2011 silver/gold output
ratio of LESS THAN NINE…
Moreover, as roughly 70%
of ALL silver production is by-product of other types of mines (principally
lead/zinc), further downturns in global economic activity could decrease
silver production – just as its MONETARY demand explodes…
Anyhow, this RANT was
“catalyzed” by my fascination with Cartel algorithms that appear to
have ARBITRARILY chosen “54” as the current ratio of PAPER gold to PAPER
silver prices. In the PHYSICAL world, the ratio is somewhat lower, as premiums
are generally higher for silver than gold; particularly when major
mints RUN OUT of supply…
However, in the PAPER
world, it has averaged 57 over the past 39 years; and “54” for the past two…
For these and many other
reasons – mostly detailed in the “PEAK SILVER?” RANT – “ADMIRAL SPROTT” believes silver will be the best asset
class of the decade. I whole-heartedly agree, as I continue to
anticipate the “ULTIMATE QUADRUPLE TOP BREAKOUT”; and with it, a decline in the
gold/silver ratio to somewhere between 5:1 and 15:1.
PROTECT YOURSELF,
and do it NOW!
