Read the Beforeitsnews.com story here. Advertise at Before It's News here.
Profile image
By Alton Parrish (Reporter)
Contributor profile | More stories
Story Views
Now:
Last hour:
Last 24 hours:
Total:

These Forces Will Push Silver Over $100

% of readers think this story is Fact. Add your two cents.


Posted by Wealth Wire – Monday, November 19th, 2012

There are tremendous forces at work that will push silver over $100 an ounce. Very few precious metal analysts understand all the forces that are at work. Some analysts focus on specific areas such as the gold-silver ratio and technical analysis, while others write about future investment and industrial demand. And then of course, we have the more unorthodox analysts who delve into the ongoing manipulation of gold and silver — a realization shared by the author of this article. 

However, one of the most important aspects of silver that most analysts are completely unaware is the availability (or lack of thereof) of future silver mine supply. I am simply amazed how some analysts can forecast lower silver prices due to a so-called future supply glut that is supposedly coming in the next few years.

As I have mentioned before in a previous article, analysts today are so specialized they have no idea what is going on in another industry. It is highly doubtful that the metal analysts who make these long term silver supply forecasts really comprehend the details of the energy market and industry. The failure of these metal analysts to understand the complexity of the global liquid supply system will render their future forecasts completely inaccurate. This will be discussed at the latter part of the article as it is one of the longer term forces to impact silver. 

Silver Surplus-Deficit Explained Again

There still seems to be a misunderstanding about the so-called surplus-deficit of silver. Some analysts are pointing to the fact that increasing annual silver surpluses, without continued strong investment demand, can make the price of silver fall quite rapidly. I would like to repost this graph to show the surplus-deficit forces.

According to GFMS (now Thomas Reuters), there was a silver deficit until 2003. During this time of supposed deficits, the price of silver remained in the $4-$5 range. However, when the deficits disappeared and the surpluses began, the price of silver magically began to rise. The first year silver was no longer in a deficit (2004) it hit an average price of $6.67 an ounce. Then in 2005 it reached an average of $7.32, $11.54 in 2007, $13.38 in 2008, $14.98 in 2009 and so on and so forth.

The white line on the graph represents the average annual price of silver. As you can see the price is heading higher in parallel with the so-called rise of silver surpluses. These silver surpluses have been absorbed by institutional and retail investors. The notion that a structural deficit in the annual silver supply would push the market price of silver higher, failed to materialize prior to 2003 when actual deficits took place.

So, here we can see that the rise in the price of silver since 2004 has less to do with industrial demand and more a factor of increased silver investment.

Silver Investment Demand: Just Getting Started

Precious metal enthusiasts who are concerned about whether or not silver investment demand will remain strong in the future… shouldn’t be. From the data I am gathering, we are just beginning to see how large of a force silver investment demand will be in the upcoming years.

One of the more notable gauges of increased silver investment over the past decade, has been the growing demand of official government coins. In 2002, total supply of official government coins and medals were 31.6 million ounces. However, by 2011 this grew to a staggering 118.2 million ounces, a gain of 274% in just nine years.

Much more here with more charts: http://www.wealthwire.com/news/metals/4181?r=1

 

 



Before It’s News® is a community of individuals who report on what’s going on around them, from all around the world.

Anyone can join.
Anyone can contribute.
Anyone can become informed about their world.

"United We Stand" Click Here To Create Your Personal Citizen Journalist Account Today, Be Sure To Invite Your Friends.

Please Help Support BeforeitsNews by trying our Natural Health Products below!


Order by Phone at 888-809-8385 or online at https://mitocopper.com M - F 9am to 5pm EST

Order by Phone at 888-388-7003 or online at https://www.herbanomic.com M - F 9am to 5pm EST

Order by Phone at 888-388-7003 or online at https://www.herbanomics.com M - F 9am to 5pm EST


Humic & Fulvic Trace Minerals Complex - Nature's most important supplement! Vivid Dreams again!

HNEX HydroNano EXtracellular Water - Improve immune system health and reduce inflammation

Ultimate Clinical Potency Curcumin - Natural pain relief, reduce inflammation and so much more.

MitoCopper - Bioavailable Copper destroys pathogens and gives you more energy. (See Blood Video)
Oxy Powder - Natural Colon Cleanser!  Cleans out toxic buildup with oxygen! 
Nascent Iodine - Promotes detoxification, mental focus and thyroid health.
Smart Meter Cover -  Reduces Smart Meter radiation by 96%!  (See Video)

Immusist Beverage Concentrate - Proprietary blend, formulated to reduce inflammation while hydrating and oxygenating the cells.

Report abuse

    Comments

    Your Comments
    Question   Razz  Sad   Evil  Exclaim  Smile  Redface  Biggrin  Surprised  Eek   Confused   Cool  LOL   Mad   Twisted  Rolleyes   Wink  Idea  Arrow  Neutral  Cry   Mr. Green

    Total 2 comments
    • i_think_i_smell_a_rat

      being i bought some…prices will crash…;)

    • Anonymous

      I buy my silver at silver towne in Indiana, and read Franklin Sanders daily commentary at the-moneychanger.com The rules of investing are no longer valid. They were invented and followed at a time whem America’s debt was Not out of hand.
      Those following traditional investment strategies still being given by investment advisers will be hurt. It will end with crying and the gnashing of teeth. Perhaps wailing also.

    MOST RECENT
    Load more ...

    SignUp

    Login

    Newsletter

    Email this story
    Email this story

    If you really want to ban this commenter, please write down the reason:

    If you really want to disable all recommended stories, click on OK button. After that, you will be redirect to your options page.