munKNEE.com Your Key to Making Money
We are at the beginning of a major shift out of paper assets into real assets and the 
more I studied the merits of owning gold and silver the more I realized that silver was the smart decision. Let me explain.
By Silver Shield (dont-tread-on.me) from an article* entitled 10 Reasons Why Gold Is The Gut Reaction And Why Silver Is The Smart Decision.
People who have trusted the paper market first go to gold when they have their awakening [because it] is the largest precious metals market in the world and has the most advertising behind it. They have seen it in movies as pirate treasure and maybe heard it was confiscated many years ago… In short, gold is the gut reaction for most paper investors who want out of the casino...
Why Own Silver and Why Now?
Silver… is simply the best investment out there…[because,] first and foremost… it is a physical tangible asset. When I say invest in silver, I DO NOT mean anything else but the real stuff in your hand. If you don’t hold it, you don’t own it. Stay away from SLV, unallocated bullion accounts, mining shares, etc. – stick to the physical. I would hate for you to be right on silver and wrong on the form of silver.
We are entering a generational shift out of paper assets into real tangible assets…The U.S. dollar is going to collapse…It is a mathematical certainty. This dollar collapse will be the single largest event in human history and will dramatically touch every human being on earth and will leave a scar on generations to come. Yes, it is going to be that big.
When the mathematically inevitable collapse of the dollar happens, all paper assets will be destroyed. This goes for Dollars, Yen, Euro, CDs, Munis, T-Bills, Money Markets, Insurance Policies, Pensions, Privately Owned Businesses, Structured Settlements, Social Security, Dividends, 401ks, IRAs, Stocks, Options, Bonds and even Real Estate. Without a functioning currency and the uncertainty it brings, credit grinds to a halt, payments grind to a halt, markets grind to a halt, the world economy grinds to a halt, people panic – and this ALWAYS leads to war.
Why are Precious Metals the Preferred Choice?
[Such inevitability,] naturally, leads investors to tangible assets like commodities. Commodities are real things we use in our everyday life like pork, cotton, corn, oil and steel. The problem with most commodities, [however,] is storage. I know for a fact that the two best assets to be in, in terms of real inflation adjusted returns, will be food and fuel. They are the most essential to humanity and the hardest to live without…[but] unless you are a farmer or oil baron this usually rules out many commodities for the average investor. This brings us to metals because they don’t deteriorate. For most metals, storage again is a big issue. $6,000 will buy you a ton of copper but only 5 troy ounces of gold [at today’s prevailing prices] . This is why precious metals are so sought after, because of their rarity and the ability to store so much wealth in a small space.One of the biggest reasons why people invest in precious metals is that there is no counter party risk. Its value is derived from its intrinsic value of rarity and potential uses. With precious metals you do not have to worry about someone paying a dividend or earnings in a depression or a currency collapse. In fact the worse things get in the economy, the more people will escape to precious metals and drive up their prices.
Why are Gold and Silver the Specific Choice?
Once you see that precious metals are the place to be, then you need to choose between the big 4 precious metals; gold, silver, platinum and palladium. Platinum and palladium have rarity and industrial use going for them but they have never been used as money in history. With a currency collapse, I want something that will have the most demand to drive up the price the most. I want my metal to have industrial, investment and monetary demand…
What are the Competitive Advantages of Silver vs. Gold?
This leaves us with gold and silver as the only two rational choices for investment in the face of a mathematically inevitable world-wide currency collapse.
[Below are some of] the competitive advantages of silver over gold.
- Silver is the second most versatile commodity, second only to oil.
- With its growing technological and medical uses, its demand is vital to any recovery we will see. Silver’s unique anti-microbial, reflective and conductive qualities make it a vital element in many high ticket projects.
- Since it is so vital and used in such small quantities, its price is inelastic. If silver goes to a $500 a troy ounce and Apple Computer needs a 1/10 of an ounce to make their $1,000 computer work at the highest quality, they will simply raise the price $50 to make up the difference.
- Silver is cheap enough for the common man to buy.
- With gold at…[$1,200 a troy ounce currently, more or less] it is not really conceivable the average American, much less most people in the world, will ever have enough money to buy one ounce of gold. People are struggling to make mortgage payments, much less buy an ounce of gold.
- With silver at…[around $16 a troy ounce more or less], a husband could buy a couple of coins without consulting the wife. If he blew $1,200 [more or less] on one troy ounce of gold, he might have some explaining to do.
- Since silver is relatively cheap, the higher the price of gold goes, the more demand will naturally flow into silver.
- Gold is treasured, silver is thrown away.
- Since the dawn of man, gold has been treasured [while,] in more recent times, silver has been trashed as an industrial commodity and not valued as a precious metal. With the rise of technology, silver has been literally thrown away in such small quantities that is may never be recovered. In fact, the USGS said that if this current trend continues, silver will be the first element to become extinct on the periodic table.
- There are no large stock piles of silver left.
- Over the past decades we have been consuming more silver every year than we mine. This is only possible because we used up all of humanity’s previously mined silver. In 1950, it was estimated that there were 10 billion ounces in major stockpiles, today there are none left so, even though gold is 10 times more rare than silver when mined out of the earth, the fact that gold has been treasured and silver has been trashed makes the silver that is left much more rare than the 10 to 1 ratio that naturally occurs.
- The gold to silver ratio is at 1:73.
- It takes approximately 73 troy ounces of silver to buy 1 troy ounce of gold so
- if throughout all of history silver has been mined at a gold to silver ratio 1:10, how much longer can a 1:73 ratio exist?
- if silver has been trashed for decades and gold treasured, how much longer can the 1:73 ratio exist? …
- At some point the market is going to recognize the incredible opportunity and, when it does, it will most likely overshoot and could make silver more valuable than gold.
- if you really want gold, buy silver. You can buy 73 ounces of silver now and if the ratio falls to a 1:1 ratio you can trade 73 ounces of silver for 73 ounces of gold…
- It takes approximately 73 troy ounces of silver to buy 1 troy ounce of gold so
- The silver market is so small…
- Since the gold market is so large, I think that is why we see central banks and major institutions are buying gold. If they dumped a billion into silver, they would explode the market. A billion into gold would hardly make a ripple…
- If you see that quadrillions in paper assets are going to fail and that most commodities are not suitable for investment and how small the silver market is, it does not take a very large stretch of the imagination to think what will happen when people try to get into this market.
- The majority of gold owners are the banksters.
- If you look at the largest stockpiles of gold owners it falls mostly on the central banks of the world. The very guys that are destroying the paper markets, are the largest owners of gold. There is no central bank that I know of that even owns even an ounce of silver.
- Since silver has been used more times as money throughout history as money than gold, logic would dictate that at some point banks are going to want to own silver...
- If you look at the largest stockpiles of gold owners it falls mostly on the central banks of the world. The very guys that are destroying the paper markets, are the largest owners of gold. There is no central bank that I know of that even owns even an ounce of silver.
[The above article is presented by Lorimer Wilson, editor of www.munKNEE.com and www.FinancialArticleSummariesToday.com and the FREE Market Intelligence Report newsletter (sample here – register here) and may have been edited ([ ]), abridged (…) and/or reformatted (some sub-titles and bold/italics emphases) for the sake of clarity and brevity to ensure a fast and easy read. The author’s views and conclusions are unaltered and no personal comments have been included to maintain the integrity of the original article. This paragraph must be included in any article re-posting to avoid copyright infringement.]
*http://dont-tread-on.me/10-reasons-why-gold-is-the-gut-reaction-and-why-silver-is-the-smart-decision/
Stay connected!
- Register for our Newsletter (sample here)
- Find us on Facebook
- Follow us on Twitter (#munknee)
- Subscribe via RSS
Other Related Articles:
1. Gold & Silver Markets’ Best Analyst Is Michael Noonan – Here’s Why
There is so much hype and cheer-leading out there amongst supposed gold & silver analysts that you probably wonder just who is worth your time to follow, if anyone. Having read and analyzed hundreds and hundreds of articles on the subject I have concluded that there is ONLY one such person. That’s Michael Noonan. Read More »
2. Coming Rotation From Stocks Into PMs Will See Silver Lead the Way – Here’s Why
The “year that was” brought mostly disappointment to precious metals bulls. Silver prices fell for the third straight year but when we finally see a major rotation out of stocks and into precious metals, silver has the potential to lead on the way up just as it has led on the way down. Let me explain why. Read More »
3. Silver Is One Of the Most Important Industrial Metals – Here’s Why
Silver may be a precious metal but it also is one of the most important industrial metals too as this infographic so clearly illustrates. Read More »
4. Silver:Gold Ratio Suggests +$200/ozt Silver Quite Plausible! Here’s Why
Given the fact that a) the historical movement of silver is 90 – 98% correlated withgold-silver gold, b) silver is currently greatly undervalued relative to its average long-term historical relationship with gold and c) many analysts predict a parabolic rise in the price of gold over the next 5 years it is realistic to expect that silver will also escalate dramatically in price – but by how much? This article applies the historical silver to gold ratios to come up with a range of prices based on specific price levels for gold being reached. Read More »
5. Silver: 14 Parabolic Peak Price Predictions By Year (2015-2020)
Over the years only 14 pundits have been bold enough to provide a specific date as to when their forecast for the future price of silver would be realized. This article provides that information along with the criteria & rationale for their determinations. Read More »
6. The Case For $5,000 Silver – Yes, $5,000 Silver
If the price of silver were based directly on the real physical silver market, silver’s price should be at $5,000 an ounce. I’m not saying the price of silver will reach $5,000 an ounce; I’m just saying that the actual PHYSICAL silver spot price is not only extremely undervalued, but that it is an illusion compared to the real value of an ounce of physical silver, since it is totally disconnected from reality. [Let me explain further.] Read More »
7. Silver Will See Much Greater % Price Appreciation Than Gold – Here’s Why
The price of silver is going to go much, much higher – much higher – over the next decade relative to gold. Below are 5 solid reasons why I believe that is the case. Read More »
8. Silver, Gold, Platinum & Copper: A Comparison of Their Physical Properties
This article looks at physical gold, silver, platinum and copper regarding their respective versatility of use, durability, fungibility, store of value, liquidity and aesthetics which yields a new perspective and appreciation of each. Read More »
Few investment opportunities arise in our lifetime like silver. The stage is set for a percentage gain of extraordinary magnitude! Forget the popular refrain of “Got Gold?” and make some additions to your portfolio to take advantage of the coming silver supernova! Read More »
10. Pessimism Regarding Silver Has Gone Too Far – Here’s Why
Has anything changed for silver? [Not really.] The only change is that the media is telling us the economy is doing better; hence, investors are not buying into the precious metal sector. The reality of the situation is that the supply of silver in the market is declining, while demand is rising by the double-digits. [As a result, in my opinion,] pessimism towards the “poor man’s gold” has gone too far. In fact, I’m expecting silver to provide investors with a better return than gold bullion over the next 24 months. Below is my explanation why. Read More »
You may be right or you may be wrong. There is plenty of evidence to support your arguments and I won’t be taking a chance so I will make sure I own some silver.
However, as a neutral observer I am not convinced that fiat currencies will necessarily collapse in the way that you and others suggest. Nixon bought time with the emergence of the petrodollar in 1971 and no doubt powerful forces are at work today to find some new magic cure or new con trick that will allow fiat currencies to continue for years to come. The prices of gold and silver have been successfully manipulated for decades and that could continue. There is also plenty of unmined silver in the ground which will become viable to mine if the price starts to rise. Industrial demand can stabilise or decline, for example if recession takes hold. New solar panels use 20% less silver due to technological advances.
I will still buy silver because it will probably hold its value and may even rise in value if demand increases but I won’t be spending the anticipated profits just yet. The eggs may or may not hatch.
The answer is simple, what did the people do during the Weimar Republic collapse, we would do the same, history not only repeats, it should teach us as well. Plan accordingly and don’t wait…..
1. First of all, great article.
2. Second, while premiums per ounce on 10 oz. silver bars are often less than those on 1 ounce rounds, and bars are easier to stack, it doesn’t mean that you shouldn’t have a mix of formats – bars, coins, rounds – with differing masses.
3. Third, I think the challenge we sometimes have is that we denominate silver in dollars. Therefore, the argument that currencies will collapse leaves us scratching our heads because even if silver was worth $5000 per ounce, what good would that do us if dollars were worthless, meaning that nobody would take them in exchange for goods and services.
Perhaps a more useful thing to consider is what an ounce of silver would buy in goods and services. For instance, compare what $5.00 would buy in the grocery store today with what it would buy 30 years ago. At 2.8% annual inflation, you would need $11.50 today to have $5 of 1984 value. (Inflation for necessities like food has run even higher than this rate). Now compare silver’s value 30 years ago today. $5 dollars spent on the metal in 1985 (about 1 ounce) will buy you $16 worth of groceries today.
4. Fourth, no one says you can’t cut that 10 ounce bar to smaller masses to pay for things like gas in the event of a collapse.
That is something that i would also like to know.
Imagree with you and others on this matter however let me pose one question that been bothering me.
I purchase 10 oz bars – three every month. So when the paper money collapses, how does having so many 10 az bars work in what is left in the economy?
Could I but food and fuel? How do I get change for a tank of gas if I pay with a ten oz bar?
Would appreciate a reply. Thanks
I have same question …though i do buy eagles and 1 oz rounds and junk silver mixed in…but if all the currencies collapse…then how can “price” increase or decrease…since it would seem there isn’t anyway to set a price with no currency being used…I think I may be missing something here?
thx for any reply
Couldn’t agree more. Thank you for the concise and thorough argument.