Are Gold And Silver Really At An All-Time High
Gold is at a record high right? Well, actually gold has never traded for more than $1,400 per ounce, but if you adjust for inflation gold is about half way to its record high and silver is about one tenth of its all-time high.
Another thing to consider is that most of the industrial uses for silver involve destroying the product making, recovery very difficult or impossible. The industrial uses of gold traditionally do not require the product to be drastically altered or destroyed. Interestingly the total available amount of silver that has been mined on earth, and is available is roughly 1.25 billion ounces worth roughly 30 billion dollars. The mined available quantity of gold is estimated to be 4.5 billion ounces or roughly 6.5 trillion dollars.
If you consider these facts, gold is either very over priced or silver is very under priced. Another interesting fact is that the silver demand is out pacing mining capacity by 25%. The only way to bridge that gap is to recycle silver to cover the shortfall.
Another important issue to consider is that silver is typically a mining by-product of other metals such as copper and zinc. If the economy continues to falter the demand for these metals will fall which will cause a decrease in mining and more demand pressure.
To clarify my point again, gold is starting to look a bit over priced compared to the relative value of the silver market. Gold may not be all that glitters in the fascinating period in the metals markets. Precious metals continue to be a very interesting market to keep your eyes on, and giving silver a look seems like a good idea. As with any commodity, precious metals investing is not for the faint of heart. But they definitely appear to be worth a very close look.
This article is not intended as investment advice. Please consult an investment advisor.
Article Source: FxTradingStock.com
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Learn more about buy and sell silver. Stop by Andrew Ginster's site where you can find out all about buy and sell gold and what it can do for you.
by: Andrew Ginster
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Word Count: 324
Date: Sun, 28 Nov 2010
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