September 6, 2013
Original Source: Money Morning
By: Peter Krauth, Resource Specialist

Excerpts from:

The Greatest Silver Buying Opportunity In History... This is Your Last Chance

With the market still on a relentless tear, you've probably heard lots of talk that a pullback is on the way.

It very well could be...

But if you invest like us, then you don't care whether the market slides a little, or even a lot. In fact, you welcome it because that's when the biggest steals are found. That's why we love silver right now.

While gold has fallen around 25% from its all-time high, silver prices are 55% below their 2011 peak. In fact, not only is this a good time to get your hands on silver... Recent events have made this the best time in history to buy silver.

So here's why you should take advantage of your last chance to buy it under $40/ounce.

It Could Hit $60...

All bull markets go through periods of consolidations and corrections. Silver is no exception. In fact, because the global silver market is relatively small, silver prices tend to be more volatile. The thrashing we witnessed in silver this past year is a testament to that fact. But volatility works both ways, so when silver rises, its price can virtually explode higher.

That's exactly what happened in April 2011, when silver prices rose by 170% in the space of just 7 months. No wonder we call investing in silver like "gold on steroids."

The thing you need to know is, it's looking like the silver market is on the cusp of doing the same thing all over again. According to our research, the next stop could be $40 by year's end, and $60 in 2014.

Relentless Buying of Physical Silver

Despite the drubbing that silver has taken the last six months, there's one aspect of the market that most observers are simply ignoring: The physical silver market.

While gold and silver prices took a pounding, people were not running to unload their silver-quite the opposite. In fact, savvy investors were flocking to buy physical silver. Even as silver prices dropped, buyers stepped up, and supply became so scarce, premiums nearly tripled to 18% above spot prices. Essentially, virtually no one was selling, yet a lot of buyers recognized that silver was "on sale" and decided to stock up.

In the first six months of 2013, the U.S. Mint sold more than 24 million ounces of silver coins.

That's the first time ever the Mint has sold this many coins so early in the year, setting a record in the 27-year history of the series. Coin dealers across the U.S. have been regularly selling out of their inventories, desperate to get new allocations.

Silver also has a wide array of industrial uses.

Industries from electronics to medicine are taking advantage of silver's unique physical features such as its combination of strength and flexibility, natural anti-bacterial properties, and being a highly efficient electrical and thermal conductor.

Rising industrial demand for silver is expected to be fueled in part by growth in the automotive sector and a recovery in the housing and construction industries. In addition, silver is used in electronic gadgets found in many vehicles today, as well as in lighting, batteries and even solar energy systems.

But the biggest boon to silver's industrial use will come from emerging markets. As living standards improve in those economies, electronics, construction equipment, water purification and sewage treatment systems, which all require silver, will become increasingly needed, affordable, and sought after. With investors buying 56 times more physical silver than physical gold, Main Street is setting the pace, while Wall Street is either oblivious to the trend or deceitfully trying to keep prices down.

Silver ETFs Bulking Up

As smart retail investors have been soaking up physical silver, so have the silver exchange traded funds (ETFs).

In the first quarter of 2013, over 140 tons of gold was sold by physically backed gold ETFs. But remarkably, silver ETFs bucked that trend. In that same slice of time, the world's silver ETFs actually added 20 million ounces to their vaults. That's nearly $600 million worth of silver being bought within just 3 months, all while silver prices were steadily declining. Silver ETF shareholders are a combination of both retail and institutional investors. But 20 million ounces flowing in is a clear sign of recognizing value and steady hands. This kind of action is especially revealing. It signals that once an ounce of physical silver is bought, its owners have "sticky" hands, and they are very reluctant to sell.

Silver Ultimately Peaks at $250

The bull market in silver is far from over. Given how silver has reacted after a strong selloff in the past, we could easily see the precious metal regain the $40 level by year's end. And in 2014, $60 silver is looking very attainable.

If the 1970s bull market in silver is any indication, we could see silver reach $125 by the time this bull market finally peaks.

But this time around the fundamental drivers are so entrenched, and global demand is so powerful, we could actually see silver at double that level, finally reaching $250 per ounce.

We're not the only ones thinking silver has much, much higher to go. Eric Sprott, the billionaire Canadian resource guru, recently said:

"I think silver will be the investment of this decade whereas gold was the investment of the last decade. Silver will outperform gold. I believe silver will trade down to a 16:1 ratio to gold...Your return will be 300% more. If you have the patience and can stomach the volatility, I think silver will by far be the better investment going forward."

Editor's Note: Fiscal policies enacted by President Obama and Chairman Bernanke are creating another economic crisis. Bernanke's cheap money strategy has sent our national debt past $17 trillion and has created nothing but fake wealth. This will lead to the biggest crash yet, and it will all collapse faster than anyone expects.

These articles are provided for informational purposes only and were obtained from publicity available sources on the Internet. These articles do not constitute financial advise or trading recommendations by Global Asset Management ("Global"). Global neither warrants the accuracy or completeness of the information contained in these articles, undertakes to update them, nor is it responsible for any omission or error contained in these articles. Viewers are encouraged to conduct, and should only rely on, their own independent research.
The purchase or sale of precious metals involves substantial risk and volatility. If you are contemplating purchasing and/or selling precious metals, you should consult with an independent financial advisor to learn about the inherent risks. Global does not render, and nothing in this website should be construed as, financial advise, a trading recommendations or a solicitation for the purchase or sale of precious metals.
 
 

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