View Full Version : Please explain the "pay for 30 houses when silver soars" theory

Silver Tiger
20th July 2008, 00:14
I'm trying to understand something. If I keep investing in silver for the next 5-10 years, I will be able to buy 30 houses with the profits?

I don't see how this is possible. If silver is going to soar enough for me to buy even just a few houses with, then won't everything else also be soaring due to inflation?

In other words, my rent, my food, my clothes, my bills will become so outrageously expensive that not only will I not be able to buy 30 houses with my silver profits, but I won't be able to buy anymore silver.

At my current rate, I am investing around $500 a month in silver. Even if the prices of everything stayed the same, that is not enough for me to buy 30 houses in 5 years even with silver at $100 an ounce.

Don't get me wrong, I know it's best for me to keep investing in silver compared to not doing so, but isn't it just a wee bit dreamy to say that people who are buying up silver now will become millionaires in a few years?

20th July 2008, 02:04
I read a similar theory in one of Ted Butler's articles awhile back where his friend Israel Friedman also wrote part of the article about "silver buying a house for a few hundred ounces" or something to that effect.

Here's a link to the archive if you'd care to look:


From the 2/19/08 article by Ted Butler and Israel Friedman

"4) At some point, in 15 to 20 years, silver prices will be 5 times higher than gold prices. If my calculation is correct, a dollar invested in silver will do many times better than gold. In real estate value, I think 1,000 ounces of silver will buy a 3-bedroom apartment in Manhattan in Trump Towers."

Here's another:


Silver Tiger
20th July 2008, 11:02
Thanks for the links. So the theory says that silver will soar due to silver specific conditions, not generalized inflation. That makes a little more sense now.

20th July 2008, 15:19
He says that the silver eagles will be the most valued coin out there.

I wonder about the canada maple leafs coins which has the lowest mintage of any silve coins in north america.
The coin has a 5 dollar face value, and is the purest silver coin mintage coin made.

There is talk about 5 .9 come in 2009

21st July 2008, 18:20
I'm trying to understand something. If I keep investing in silver for the next 5-10 years, I will be able to buy 30 houses with the profits?

I don't see how this is possible. If silver is going to soar enough for me to buy even just a few houses with, then won't everything else also be soaring due to inflation?

I don't know if I agree with the '30 houses' theory, but the basic principle is that silver will soar due to inflation AND industrial demand in a commodities bull market. For these rasons, silver should outperform the cost of living increases caused by inflation. At the same time, there will be a significant deflation in housing costs. Right now, the gold/housing ratio is WAY out of whack. Housing is far overvalued and silver is far undervalued. When these meet somewhere in the middle, the value will be extraordinary.


21st July 2008, 19:24
Here's an excerpt from a Brit site. They are singing from the same hymn sheet.


Two of the largest nations, USA and China, are now net importers of Silver. One easily verifiable fact is that the United States Government is now totally out of Silver and has to go to the open market to purchase Silver to continue the Silver American Eagle Coin program. On its own thatís amazing, but consider that some years ago the US Government held 2 billion ounces of Silver and now has none !

There is no doubt that if Silver continues to be used by industry in the same quantities then itís not going to be long before the Silver supply reduces to zero. With demand outstripping supply something will have to give. There is no substitute for Silver, some of the industrial applications could replace Silver with Gold or Platinum, however bear in mind Silver is currently 65 times cheaper than Gold and 130 times cheaper than Platinum, it makes no sense to replace Silver with the more expensive metals.

Many now view Silver as just an Industrial commodity. If thatís the case, then look at palladium. Its price moved from just over one hundred dollars per ounce to over one thousand dollars per ounce, purely on industrial demand. Rarely do we see such an important commodity being in such short supply, yet growing in demand. And at less than the cost of a music CD per ounce, the potential for an explosion in price of Silver is vast.One thing bothers me.

All very fine to say that there is no substitute for Silver, but when the price of one industrial commodity goes up, the scientists and engineers always find other ways of producing their products using alternative materials.

It's just a matter of time, so the question is: "Have those industrial scientists seen the writing that has been on the wall for several years; and if so, how close are they to discovering alternatives they can use that cost a penny a pound, instead of silver in their products?"

27th July 2008, 03:22
Did you get that quote from me? I think I remember saying something like that once.

I believe I may have been exagereating (sp?) (ha ha ha)

What it means, is that silver will become not only expensive, but the value of property fall inversely. So you may very well be able to buy a house for a few ounces of silver.

If you research hyperinflation in Germany, you will find food was the number one priority. When someone is hungry, the will sell you anything to eat.

27th July 2008, 07:57
As a side note, folks will do just about anything to eat, what is the longest anyone here has gone without food? I've gone a little over 48 hours. It's really weird. I was not sick or anything... that sort of don't count. By the then of the second day I... well, I would have done just about anything.

27th July 2008, 10:15
I think you are right, Argentum. I have gone for a few days not eating, but, I was sick, and that doesn't count. Other than that, maybe uhhh, 4 hours. If I can't eat lunch at my normal time, I go nuts. I would agree that people would probably do anything to avoid starvation. Other things like shelter & transportation would be fairly easy to improvise, but food doesn't grow on....well, yes it does, but not overnight. Maybe we should be hoarding food, and when the time comes, trade the extra for silver, LOL. Let's hope the S doesn't HTF that bad, though...........

28th July 2008, 01:58
Time to go to COSTCO and stock up!!

Don't forget the toilet paper!!!!!!!!!!!!!!!

I've already been doing this as I always thought I had more to worry about from a natural disaster, what living within 40 miles of Mt Rainier or so, than some kind of financial calamity. I already have a few cases of MRE's, water is no problem with an artesion well and living on a lake and I have a dual fuel generator with 100 gallons of propane READY FOR ACTION. We've had some rockin earthquakes too, that scared the *&^%$&*!! out of me though with no real damage except for frayed nerves. The cats started freaking out a good minute before I was aware of anything. Next time I'll be a little more aware.
Anyway, it's ALWAYS GOOD to be prepared....for whatever.

28th July 2008, 09:31
A dealer I go to showed me a large 4 ounce silver coin from germany from some time in the 20's I believe. This coin was made during the hyperinflationary period they had and its face value was 1 BILLION marks. So not only will PM's be very valuable in such a scenario, but you have to think about the demand for realestate during hard times and WHO will have money to keep the housing prices high? Consider that when our economy was GOOD, houses could be purchased for less than $4,000. So when our gold and silver is essentially returned to its high value that it was back then, the conditions for buying cars and houses should be the same as it was many decades ago with low prices.