Best of the Week
Most Popular
1. Stock Markets and the History Chart of the End of the World (With Presidential Cycles) - 28th Aug 20
2.Google, Apple, Amazon, Facebook... AI Tech Stocks Buying Levels and Valuations Q3 2020 - 31st Aug 20
3.The Inflation Mega-trend is Going Hyper! - 11th Sep 20
4.Is this the End of Capitalism? - 13th Sep 20
5.What's Driving Gold, Silver and What's Next? - 3rd Sep 20
6.QE4EVER! - 9th Sep 20
7.Gold Price Trend Forecast Analysis - Part1 - 7th Sep 20
8.The Fed May “Cause” The Next Stock Market Crash - 3rd Sep 20
9.Bitcoin Price Crash - You Will be Suprised What Happens Next - 7th Sep 20
10.NVIDIA Stock Price Soars on RTX 3000 Cornering the GPU Market for next 2 years! - 3rd Sep 20
Last 7 days
Silver Price 2021 Roadmap - 22nd Jan 21
Why Biden Wants to Win the Fight for $15 Federal Minimum Wage - 22nd Jan 21
Here’s Why Gold Recently Moved Up - 22nd Jan 21
US Dollar Decline creates New Sector Opportunities to Trade - 22nd Jan 21
Sandisk Extreme Micro SDXC Memory Card Read Write Speed Test Actual vs Sales Pitch - 22nd Jan 21
NHS Recommends Oximeter Oxygen Sensor Monitors for Everyone 10 Months Late! - 22nd Jan 21
DoorDash Has All the Makings of the “Next Amazon” - 22nd Jan 21
How to Survive a Silver-Gold Sucker Punch - 22nd Jan 21
2021: The Year of the Gripping Hand - 22nd Jan 21
Technology Minerals appoints ex-BP Petrochemicals CEO as Advisor - 22nd Jan 21
Gold Price Drops Amid Stimulus and Poor Data - 21st Jan 21
Protecting the Vulnerable 2021 - 21st Jan 21
How To Play The Next Stage Of The Marijuana Boom - 21st Jan 21
UK Schools Lockdown 2021 Covid Education Crisis - Home Learning Routine - 21st Jan 21
General Artificial Intelligence Was BORN in 2020! GPT-3, Deep Mind - 20th Jan 21
Bitcoin Price Crash: FCA Warning Was a Slap in the Face. But Not the Cause - 20th Jan 21
US Coronavirus Pandemic 2021 - We’re Going to Need More Than a Vaccine - 20th Jan 21
The Biggest Biotech Story Of 2021? - 20th Jan 21
Biden Bailout, Democrat Takeover to Drive Americans into Gold - 20th Jan 21
Pandemic 2020 Is Gone! Will 2021 Be Better for Gold? - 20th Jan 21
Trump and Coronavirus Pandemic Final US Catastrophe 2021 - 19th Jan 21
How To Find Market Momentum Trades for Explosive Gains - 19th Jan 21
Cryptos: 5 Simple Strategies to Catch the Next Opportunity - 19th Jan 21
Who Will NEXT Be Removed from the Internet? - 19th Jan 21
This Small Company Could Revolutionize The Trillion-Dollar Drug Sector - 19th Jan 21
Gold/SPX Ratio and the Gold Stock Case - 18th Jan 21
More Stock Market Speculative Signs, Energy Rebound, Commodities Breakout - 18th Jan 21
Higher Yields Hit Gold Price, But for How Long? - 18th Jan 21
Some Basic Facts About Forex Trading - 18th Jan 21
Custom Build PC 2021 - Ryzen 5950x, RTX 3080, 64gb DDR4 Specs - Scan Computers 3SX Order Day 11 - 17th Jan 21
UK Car MOT Covid-19 Lockdown Extension 2021 - 17th Jan 21
Why Nvidia Is My “Slam Dunk” Stock Investment for the Decade - 16th Jan 21
Three Financial Markets Price Drivers in a Globalized World - 16th Jan 21
Sheffield Turns Coronavirus Tide, Covid-19 Infections Half Rest of England, implies Fast Pandemic Recovery - 16th Jan 21
Covid and Democrat Blue Wave Beats Gold - 15th Jan 21
On Regime Change, Reputations, the Markets, and Gold and Silver - 15th Jan 21
US Coronavirus Pandemic Final Catastrophe 2021 - 15th Jan 21
The World’s Next Great Onshore Oil Discovery Could Be Here - 15th Jan 21
UK Coronavirus Final Pandemic Catastrophe 2021 - 14th Jan 21
Here's Why Blind Contrarianism Investing Failed in 2020 - 14th Jan 21
US Yield Curve Relentlessly Steepens, Whilst Gold Price Builds a Handle - 14th Jan 21
NEW UK MOT Extensions or has my Car Plate Been Cloned? - 14th Jan 21
How to Save Money While Decorating Your First House - 14th Jan 21
Car Number Plate Cloned Detective Work - PY16 JXV - 14th Jan 21
Big Oil Missed This, Now It Could Be Worth Billions - 14th Jan 21
Are you a Forex trader who needs a bank account? We have the solution! - 14th Jan 21
Finetero Review – Accurate and Efficient Stock Trading Services? - 14th Jan 21

Market Oracle FREE Newsletter

FIRST ACCESS to Nadeem Walayat’s Analysis and Trend Forecasts

The Last Investable Moment for Silver

Commodities / Gold and Silver 2013 May 17, 2013 - 08:35 PM GMT

By: Dr_Jeff_Lewis

Commodities

In the context of the current U.S. Dollar valuation bubble, silver’s eventual price rise seem inevitable. This paper currency bubble commenced with a desperate flight to quality, despite the fact that the U.S. Dollar had been an intrinsically worthless currency since it was taken off the gold standard by Nixon in the early 1970’s.

Silver is one of many sought after investment choices when risk aversion is high. What makes it a convenient choice happens to be that the metallic commodity has special qualities that have historically made it one of the best forms of money.


The key is not to say that silver would necessarily become a medium of exchange, although it might indeed be useful as an asset that could be bartered in an emergency situation.

Still, once the U.S. Dollar devaluation finally occurs, silver’s use as a medium of exchange in the aftermath would probably quickly transform into the metal’s other traditional use as a store of wealth.

In other words, what above ground silver is left would very likely return to the vaults, probably being held as the basis or backing for the next new script. The fiat currency cycle would then begin again.

The Dirty Dollar’s Secret

The dirty secret is that while having sound money like silver indeed seems like the rational thing to do, the short term pain of this transition from the paper Dollar seems unbearable and impossible to reconcile other than in an emergency situation. This self-reinforcing collective fear of short term pain is also why the politics reflecting this seem so entrenched. 

Still, in terms of societal pain, not individual, the concern over others ‘wellbeing is used to rationalize putting off the inevitable. This questionable argument is also used to vilify just about anyone who would go against that sentiment as self-serving, deluded, etc.

The U.S. Dollar is a debt-backed currency. Never before has such an intrinsically worthless currency survived very long as a medium of exchange. Eventually, the interest payments on the debt become too high to service and the inevitable bursting of the Dollar bubble will begin. A small rise in the rate demanded for debt would quickly eclipse tax revenue.

The Silver Trader’s Dilemma

Trading paper silver rationally seems nearly impossible. Nevertheless, the paper price does not really matter as long as you are a long term physical investor and not a short term futures trader.

Furthermore, if you are an equity trader, you are typically better off by just buying an index, which usually beats the hedge funds that use it as their yardstick.

The moment that confidence in the U.S. Dollar eventually breaks, the opportunity to buy silver will be over.Sadly, complacency currently rules and that precious moment will be lost to those people who preferred to wait on the sidelines rather than jump into the chronically undervalued physical silver market with both feet.

Price controls are very powerful and can effectively shape perception, even where history is readily available, evidence of a paper versus physical separation exists, and the shortage of physical silver is widespread.

The Value of Seeing Silver Clearly

The short term price and investor anxiety effectively obscures their ability to perceive this situation. This phenomenon seems especially notable among the waiting multitude who are otherwise one step away from the internal shift to buying silver.

When the true value of silver hits them, the precious metal becomes the obvious investment choice in their personal flight to quality.

Silver may never return to its constitutionally mandated position as an official currency, its long forgotten status as the coin of the realm, but that does not mean it will not be an excellent future investment for you and your loved ones.

Once the revaluation of silver occurs, the lesson of its value as a store of wealth anda medium of exchange will not soon be forgotten.

For more articles like this, and to stay updated on the most important economic, financial, political and market events related to silver and precious metals, visit www.silver-coin-investor.com

By Dr. Jeff Lewis

    Dr. Jeffrey Lewis, in addition to running a busy medical practice, is the editor of Silver-Coin-Investor.com and Hard-Money-Newsletter-Review.com

    Copyright © 2013 Dr. Jeff Lewis- All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Dr. Jeff Lewis Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules