The sale of physical silver coins is breaking all sorts of all-time records. The obvious questions should be, “Why is this occurring?” and “How does this affect me?”. Are the rising ‘currency wars’ stoking people’s ongoing rotation from paper-to-physical assets as their ‘wealth’ is slowly losing its value? Understanding financial markets and investment is a big key in becoming successful.
The U.S. Mint was on pace to sell more silver eagles during the first month of 2013 than it did during the entire year of 2007. The Mint was on a pace to sell nearly 15 million silver eagles in the first month of 2013, which would be a record ANNUAL sales total as recently as 2007! (9 million ounces sold for all of 2007).
During the first 6 days of January of this year the Mint sold 5.082 million ounces! As it turned out, January silver eagle sales came in at 7.498 million ounces shattering the January 2011 monthly all-time sales record of 6.422 million ounces.
It is obvious that investors are seeking refuge from U.S. economic uncertainty. Investors are doing everything in their power to protect themselves from the ever-worsening currency devaluation. Many think that silver will be the best single investment of this decade. The lower price of silver (as compared to gold) appeals more broadly to small investors.
The amount of silver consumed annually and bought for investment currently exceeds the total annual mining output. This has been the case for years. In addition, the supply and demand equilibrium in silver is extremely tight. There is now less than one year of inventory of silver, compared to over eleven years of inventory in the 1970’s.
Silver has many more industrial and commercial applications than gold does. Silver is an industrial metal with over 10,000 commercial applications. Silver also has many medicinal applications. Silver’s industrial demand should increase by 60% within 2 years. Because of these factors, the purchase of silver has become a more attractive investment.
The primary reason you should have a significant percentage of your investment assets in precious metals is simple: to protect the real purchasing power of your accumulated wealth! Since the Federal Reserve was created in 1913, the US dollar has lost 95.6% of its purchasing power. There is no comparison between the retention of real purchasing power of precious metals versus the dollar.
The total gold market is sixty one times the size of the silver market. As interest in silver increases, this sets up a situation where price of silver could soar higher in a shorter period of time than gold.
I wish you the best of “believing” in all of your future endeavors,
ROB – (admin)
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