Saturday, July 19, 2008

Silver Price

Silver is one of the most popular of precious metals, having been used for money for thousands of years as well as in jewelry, tableware, utensils and in recent years, electronic contacts and other equipment. Silver has been used in photographic film, as a disinfectant and even in the healing field.

The price of silver fluctuates daily and be quite volatile at times. Such factors as industrial use, stored value depending upon economic factors in world markets, as well as being used a form of money, all can affect the perceived value of silver as an investment or hedge against economic downturns. Curiously the price of solver tends to follow the same trend as the price of gold.

The silver price, in fact, often tracks the gold price due to store of value demands, although the ratio between them can vary. During most of the 19th Century the ratio between gold and silver was fixed by law in Europe and the US at 1:15.5. So one ounce of gold would buy 15.5 ounces of silver. Over the years of course this has changed. During the 20th century the ratio was 1:47.0 and now is more like. 1:55.0. So the gap, as it were, appears to be widening.

Despite this the trends of both gold and silver price remain remarkably the same and silver remains a good investment for stored value, perhaps even more than gold. Part of the reason for this is that, while all of the gold produced remains in existence, silver gets used up mainly in industrial and photographic use. Gold can be recycled and reused, keeps, passed from hand to hand. Of course silver can do the same but the quantity of silver needs to be constantly replenished due to about 5-10 percent being lost each year.

This means that the price of silver remains very healthy and, with an impending shortage on the way due to less silver being mined and yet more being used each year in industry as well as investment hording, the price of silver is going to continue to be healthier and healthier as time marches on.

Silver rounds and bars are probably one of the best ways to invest in silver. The price, when you buy silver from a good dealer, is a smart move. It is a medium to long term investment and can serve as a back up in times of economic stress and need.

One very useful way of purchasing silver is through Gold Money. Here you can buy silver almost at the spot price and have it stored in a Swiss or London bank.

One big advantage with silver is that, due to the price of silver ounces compared to the price of gold by the ounce, you can buy a lot more silver and quickly accumulate a sizable nest egg very quickly.

With the price of silver likely to rise as the value of currencies fall, this can only be a good move.

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