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An Argument Against Silver
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Thread: An Argument Against Silver

  1. #1
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    Default An Argument Against Silver

    I read an article written by an outfit called (curiously enough) "Silver Commodity Trading" I can't copy the article here as it is a pdf file. Anyway the article makes several points:

    1. Central Banks which want to backstop various currencies are mainly turning to gold as a reserve and, therefore, are holding a comparatively small amount of silver.

    2. Jewelry demand is steady decreasing because of the economy. This limits the demand for silver and gold. It also argues that few people have money to invest in precious metals.

    3. Silver has many industrial uses such as electronics. Although silver is much cheaper than gold it can be quite costly when used in mass production. Many companies are turning to "hybrid metals" (no specific examples given) as a cost saving measure.

    As you all know, I believe silver will outperform gold, however I believe its important to seek out and understand counter arguments. Points 1 and 2 are pretty easily parried, however I've never heard the 3rd point and I wonder if there is any validity to it. Anyway, I'm looking forward to hearing your thoughts.

  2. #2
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    Default Fundamentals override hype


    The facts are the facts.

    Another set of facts:

    Item ---- 1913 $ price
    Avg. Income 1296
    Loaf of Bread 0.06
    Gallon of Gas 0.12
    Gallon of Milk 0.36
    Dozen Eggs 0.35
    New Car 490
    New House 3395
    Dow Jones 78
    Gold 1Toz 20.83
    Silver 1Toz 1.30


    According to the government's CPI inflation calculator those 1913 prices by the beginning of this year would have inflated to:
    Item ---- 2008 $ inflation calculated price
    Avg. Income 28,185
    Loaf of Bread 1.30
    Gallon of Gas 2.61
    Gallon of Milk 7.83
    Dozen Eggs 7.61
    New Car 10,656
    New House 73,833
    Dow Jones 1,696
    Gold Toz 453
    Silver Toz 28.27


    Yes in some cases like the car and house it is comparing apples to oranges,
    but for most of the items it is a valid comparison
    and in the case of gasoline the cost has been tracking the government's figures inflation pretty well.

    Now tell me theo68, based on these fundamentals
    which is the stronger argument?

    For or against the appreciation of silver relative to gold?

    Actually for or against the appreciation of silver in general?

    As an aside it looks to me like Au is a bit overvalued, especially considering it's relative abundance.
    You can bet the banksters will be keeping that price down as long as they can.
    That action in turn will act to keep silver's price from going as high as it would otherwise,
    but I still expect a huge rise in the silver price within the year.
    We all know that Ag is undervalued because of the bankster culture and their system is about to break.
    I compare silver to a soon to be released over compressed spring.
    When it moves it moves fast.

    Add to all of this the imminent USD collapse, and anyone knowing this would have to be pretty stupid to continue to hold ALL or MOST of their cash in FRN based accounts such as stock brokerages.

    Right?
    "I foresee little future in 'the price of silver', I see a huge future for 'the price in silver'." - heartbone
    "The truth is called hate by those who hate the truth." - K

  3. #3
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    Default Greatest Post

    Thank You Silverheartbone: The BEST POST I have ever seen regarding silver. Puts everything Butler, Izzy, Morgan etc. have been talking and teaching about in perspective. Stack on my friend. See You At The Top

  4. #4
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    Default

    Quote Originally Posted by beach miner View Post
    Thank You Silverheartbone: The BEST POST I have ever seen regarding silver. Puts everything Butler, Izzy, Morgan etc. have been talking and teaching about in perspective. Stack on my friend. See You At The Top
    Thank you beach miner.
    I guess I'm preaching to the choir.

    The only thing that might stop the silver value appreciation
    is if they figure out how to cheaply transform another element to silver.
    "I foresee little future in 'the price of silver', I see a huge future for 'the price in silver'." - heartbone
    "The truth is called hate by those who hate the truth." - K

  5. #5
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    Default

    Quote Originally Posted by silverheartbone View Post
    The only thing that might stop the silver value appreciation
    is if they figure out how to cheaply transform another element to silver.

    I don't know....I'm turning paper into silver pretty regularly....
    TRUTH is not dependent on one's belief of it...
    John 14:6 Jesus saith unto him, I am the way, the truth, and the life: no man cometh unto the Father, but by me.

    "Get Real"

  6. #6
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    Default

    Quote Originally Posted by silverheartbone View Post
    Thank you beach miner.
    I guess I'm preaching to the choir.

    The only thing that might stop the silver value appreciation
    is if they figure out how to cheaply transform another element to silver.
    Silvers day's are numbered in the electronics world. It may be next year or next century, but a cheaper and better material "will" be found or created. Who's to say electricity will even be around 20 years from now. Then again, electricity's replacement might require many times more silver than electronics today. Sooner or later, everything becomes obsolete. Hopefully, Silvers industrial demand is not one of them.

  7. #7
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    Default

    Quote Originally Posted by valerb@bellsouth.net View Post
    Silvers day's are numbered in the electronics world. It may be next year or next century, but a cheaper and better material "will" be found or created. Who's to say electricity will even be around 20 years from now. Then again, electricity's replacement might require many times more silver than electronics today. Sooner or later, everything becomes obsolete. Hopefully, Silvers industrial demand is not one of them.
    I have a degree in electrical engineering from the days of slide rules and computer punch cards,
    so I know a bit about electricity as opposed to electronics.

    Electronics perhaps, but I assure you that electricity will never be obsolete.

    What percentage of "industrial" demand is electrical/electronic?
    My uneducated and un-researched guess is less than a third but probably growing fast.

    However I think that the monetary PM safe-haven "investor" demand aspect will be a bigger driver than "industrial" demand over the next few years.
    "I foresee little future in 'the price of silver', I see a huge future for 'the price in silver'." - heartbone
    "The truth is called hate by those who hate the truth." - K

  8. #8
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    Default

    Quote Originally Posted by silverheartbone View Post
    I have a degree in electrical engineering from the days of slide rules and computer punch cards,
    so I know a bit about electricity as opposed to electronics.

    Electronics perhaps, but I assure you that electricity will never be obsolete.

    What percentage of "industrial" demand is electrical/electronic?
    My uneducated and un-researched guess is less than a third but probably growing fast.

    However I think that the monetary PM safe-haven "investor" demand aspect will be a bigger driver than "industrial" demand over the next few years.
    OK, so you were raised with the Dinosaurs. Your not the only one. When I studied electronics, the vacuum tube was king and the lonely transistor was the new kid on the block. My first data processing job was with IBM wiring and operating unit record equipment, then I moved on into the wonderful world of computers.

    My grandfather was born in 1879, the same year the light bulb was invented. Now we run around with a battery operated L.E.D. light attached to our key chain.

    Just because electricity has allowed us to make unbelievable advances, does not mean it will always be our main power source. It just takes one person to have a bright idea or stumble upon something by accident and the electron flow as we know it today, could be a thing of the past tomorrow.

    When the light bulb was invented, the majority of our homes were lighted with natural gas lamps. They had pipes running throughout the walls to provide light to each room. The light bulb greatly reduced the number of house fires, but electricity is still the number one cause of house fires today. Even with all of our advances, electricity is still a dangerous product. You don't even have to be near a live source of electricity, just have your cell phone battery explode while your using it to ruin your day.

    Natural gas lighting was replaced by the light bulb and something will eventually replace our electrical products. It's like G.E. used to say, "progress is our most important product" or was it Westinghouse?

    Where would we be today if we followed Tesla, instead of Edison? The greatest source of power man has ever known, may be all around us and we just haven't noticed it yet! Never say never, "everything" changes over time, "everything".

  9. #9
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    Default

    Not trying to compete with you, but my mother's father was born in 1878.

    Tesla was transmitting electrical energy.

    Kindly let me preface my earlier assertion.

    In the physical universe electricity will never be obsolete.
    "I foresee little future in 'the price of silver', I see a huge future for 'the price in silver'." - heartbone
    "The truth is called hate by those who hate the truth." - K

  10. #10
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    Default

    Quote Originally Posted by silverheartbone View Post
    Not trying to compete with you, but my mother's father was born in 1878.

    Tesla was transmitting electrical energy.

    Kindly let me preface my earlier assertion.

    In the physical universe electricity will never be obsolete.
    Your right about Tesla, but what about all of the other experiments he was into, we'll never know.

    Your also right about the physical universe never going without electricity, lightning and static electricity will always be there no matter what we do.

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