The Silver Lining
Of lately, silver has been hovering around the $14 to $15 bracket for some time and the ratio with gold is that an ounce of gold could buy about 80 ounces of silver, which is an overly undervalued ratio and if the market is going to stabilise any time soon, what can be expected is silver will revalue itself to a 1:70 ratio with gold provided everything else remains status quo. What is worrying everybody at the moment is the fact that the global financial system is completely out of whack, more than it was in 2008 and investors are frantically looking for the right bandwagon to jump into, but if at all the global financial system does collapse, any precious metal bought at current prices will be able to offer owners to ride the financial tsunami that is inevitable. The fact is many believe that the right price for silver is actually between $ 17 and $ 20 an ounce, and when the financial system finally does fracture, silver will make its way to at least $ 20 an ounce if not more if the financial system fails to rectify itself within a short period of time.
The fact that all other markets with the exception of the precious metal market is seemingly hazy, with the UK which is the 5th largest economy in the world wanting to opt of the EU, new bilateral trade agreements will be in the works and this would have a significant effect on industries everywhere and where the domino effects of these agreements will end is obscure. Currently almost all the major players in the market have taken a step back and are watching the market movement intently hoping to get a glimpse of what might transpire as the next five years is seemingly looking like the past 20 years as governments blow budgets and central banks monetise debts at a rate that is illogical. It is not a question of whether everything is going to tumble down it is a question of when.