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We are getting closer and closer to the bottom in gold and silver and
many are wondering once we bottom what would be a better investment moving forward, silver or gold? Words: 255
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To answer this question, we can look to the last bull market of 2000 to 2011 and see what the metals prices did.
| Year | Average Price of Silver | % Increase (Decrease) in Silver | Average Price of Gold | % Increase (Decrease) in Gold |
| 2000 | $4.95 | —- | $279.11 | —- |
| 2001 | 4.37 | (11.72) | 271.04 | (2.89) |
| 2002 | 4.60 | 5.26 | 309.73 | 14.27 |
| 2003 | 4.85 | 5.43 | 363.38 | 17.32 |
| 2004 | 6.66 | 37.32 | 409.72 | 12.75 |
| 2005 | 7.31 | 9.76 | 444.74 | 8.55 |
| 2006 | 11.54 | 57.87 | 603.46 | 35.69 |
| 2007 | 13.38 | 15.94 | 695.39 | 15.23 |
| 2008 | 14.98 | 11.96 | 871.96 | 25.39 |
| 2009 | 14.67 (financial crisis) | (2.07) | 972.35 | 11.51 |
| 2010 | 20.19 | 37.62 | 1224.53 | 25.94 |
| 2011 | 35.11 | 73.89 | 1571.52 | 28.34 |
There are a few important revelations I see in analyzing the growth of each metal each year. The first is that gold began to move up first. Silver was a laggard but did also start to move higher with gold in 2001.
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After two years of gold leading silver higher, silver took over for gold and moved higher for 4 straight years. When the financial crisis hit silver had a negative return for the year but gold finished the year up 11.51%. The final two years of the bull run we saw silver outperform gold.
My conclusion is that gold should outperform silver once we bottom but after a couple years silver should lead gold higher…[In fact,] silver will double before gold does and once we hit bottom silver will more than likely…quadruple in price before gold doubles in price.
[The original post, written by Doug Eberhardt and posted on SeekingAlpha.com, is presented above by the editorial team of munKNEE.com (Your Key to Making Money!) and the FREE Market Intelligence Report newsletter (see sample here – sign up in top right corner) in an edited ([ ]) and abridged (…) format to provide a fast and easy read.]Related Articles from the munKNEE Vault:
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