In Ted Butler's Archive


At $1,500 an ounce gold is probably not the best investment bargain in precious metals. The metal that does represent a true investment bargain is silver. Both metals share a common history dating back thousands of years. Every major advance in the price of gold has been accompanied by a price advance in silver matching or exceeding the move in gold. For this reason alone, silver would appear a better choice as an investment bargain than gold. Currently silver is priced more cheaply relative to gold than almost ever. The silver/gold price ratio is 80 to 1, meaning the price of an ounce of gold is eighty times more expensive than an ounce of silver. There have been very few times in history when silver has been this undervalued relative to gold. In five thousand years, silver has only been this undervalued to gold less than one percent of the time. Only rarely has silver been this cheap.

A hundred years ago, silver was discovered to have important and useful chemical and electrical properties. Consequently, 90% of the silver in existence was consumed by industry. Prior to the start of World War II, the amount of silver in the world was five to ten times greater than the amount of gold. The depletion of world silver inventories due to industrial consumption dramatically changed that. Today there are more ounces of gold in the world than silver. Although silver is scarcer and gold more plentiful, silver is cheaper relative to gold than it has ever been. Not only is silver an investment bargain and proven hedge against financial calamity, it is also a vital component of modern life. Because silver is the best conductor of electricity and we live in an increasingly electrified world, silver is indispensable to life as we know it.

With silver you have the last genuine investment bargain, an effective hedge that has always outperformed gold to the upside and is something we can’t live without. Furthermore, all of the silver in the world is worth $35 billion while all of the gold is worth $8.5 trillion. We’re never going to run out of gold, but we could easily have a silver shortage. Quite simply, there’s no better or cheaper investment than silver. It’s positioned for extremely large price gains and because of this you should load your boat with silver.

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