Why Silver Continues to Go Up
If you've been sitting on the fence and haven't invested in silver because you 'weren't quite sure what silver might do', you're probably wishing you'd made a decision to buy a while back since the value of silver has been on a steady upward track for the past few weeks. According to a recent article by Jason Hommel in his Silver Stock Report of April 7, 2011 - "silver will continue to do so [increase in value] for years to come".
Wondering why he can say this and what he bases his statement on? Hint: Floods of too much paper money. Read all of his reasons below . . .
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- No nation on earth is using silver as a circulating medium of exchange. The State of Utah is leading the way by making it legal tender.
- All nations on earth are using paper for money, which is about as wise as building houses out of straw. The amount of paper money is uncountable, and is constantly soaring to new highs. The USA stopped reporting the amounts of money in the banks back in 2006, and the banks in 2008 started depositing a lot of their bailout money with the Fed banks, making it even harder to track. All of that marks the beginning of hyperinflation, which appears to be starting now.
- The Federal annual deficit, which is how much they spent more than they took in, is $1.66 trillion, or $830 billion for the first half of fiscal 2011. Does that count QEII? What was not counted in that? How reliable are the figures? If the figures are wrong, are the real figures likely to be bigger or smaller, and by how much?
- The silver market remains tiny. "World investment rose by an impressive 40 percent (40%) last year to 279.3 million troy ounces (Moz), resulting in a net flow into silver of $5.6 billion, almost doubling 2009’s figure." How reliable are the figures? - http://www.silverinstitute.org/pr07apr2011.php (April 7th news item)
Recap: New US Debt: $830 billion in 6 months.
Recap: New Silver buying: $5.6 billion, all year.
Essay assignment, compare and contrast those two numbers.
Which one is bigger? Which one is smaller?
What is likely to change?
What is likely to stay the same?
If the US government spends new paper money that it does not have, is that inflationary? Will that make the new dollars tend to go down in value? If so, by how much?
Are silver prices likely to go up, as new money buys silver to protect itself? In your opinion, much new money will be likely to buy silver next year? How much do you think the silver price will continue to be driven up, in the next year, by such buying?
Is the US government likely to suddenly balance the budget by next year, or will the spending like a drunken sailor be likely to continue?
If you convince your friends to buy silver, are they more likely to thank you, or not, as certain trends and fundamentals continue?
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Jason concludes his article with the following statement, "I strongly advise you to take possession of real gold and silver, at anywhere near today's prices, while you still can. The fundamentals indicate rising prices for decades to come, and a major price spike can happen at any time."
If you don't have funds to invest, think of converting scrap into bullion rounds. For more information on how to determine what's scrapable, read our articles on gold and silver available in the 'Gold-Silver' section of The Compendium. Here we cover topics such as:
- US & European marks, alloy variations, calculate scrap gold value, definitions for other types of gold designations, i.e., gold-filled, rolled gold, vermeil.
- Precious metal weights - troy ounce, pennyweight, grams and conversion chart. Calculate weight from grams to ounces.
- Use this formula to calculate how much gold value there is in 18K, 14K or 10K jewelry - before you sell it.
- Learn how much silver there is in silver coins before you sell or spend them.
- Get the gold value for your 9K, 10K, 12K, 14K, 18K and 22K jewelry before you sell it.
Use our FREE tool to make calculations online.
- What you should know before buying sterling.
- Don't pay sterling prices for filled pieces. See pictures of sterling items and learn how weighted hollowware are constructed.
- Educate yourself because not all silver is sterling, marks, definitions and more.
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