I found this article interesting and thought you might like to give it a read....
Why Now Is The Time To Own Silver
Sep. 11, 2017 2:52 AM
Summary
Gold and silver are known as hedges against the system.
The gold/silver ratio says that silver is a buy.
There's many reasons to own silver, not just as a hedge.
By Parke Shall
We wanted to take a moment today and talk about why we are long silver and why we think that now is a great time to have some exposure to the precious metal. The fact that silver is used not only as a hedge, but also in production purposes and the fact that the silver to gold ratio remains the most diverted from the mean that we have seen in a long time gives us plenty of reason to think now is a great time to covet the precious metal.
For those that don't read us regularly, our outlook on the state of the economy in general and more notably, the state of equity markets is that we believe they are both overextended and due for a correction. We have argued in a series of articles that asset prices across the board are likely far too expensive and that irresponsible Federal Reserve policy will eventually come back and bite us in the rear.
Though we don't specifically prognosticate about the timing of such an event, we do like to have a modest portion of our portfolio allocated to items like precious metals which we believe are great to have on at all times, but even greater to own during a correction or any type of loss of confidence in the system. We own physical gold and have often argued that owning gold for the long term is a great strategy. We continue to believe that, but today we also wanted to look at silver.
It's important to have a good background on where we stand from a macro standpoint going into this article. We don't want to rehash any of our past articles but we will provide this link that links to our full catalog of articles, including many about our macroeconomics sentiments. We believe that all precious metals will continue to rise in value over the course of the long term, but today we wanted to talk about silver specifically.
One reason to own silver alongside of gold is that demand comes from two places, where is gold is generally simply held as a hedge. Silver on the other hand, has other factors that tug at its demand, including a whole host of manufacturing and production uses. This articlefrom Bullion Vault does a great job introducing people to the many uses for silver. We recommend reading the full article, but it begins by stating,
Silver has many industrial uses, accounting for more than half of annual demand worldwide over the last five years.
This means that economic growth can affect silver prices far more than it affects gold. Only 10-15% of annual gold demand worldwide comes from industrial use, the rest going to jewelry and investment.
Because of silver's physical strength, brilliance, malleability and ductility (it can be squashed or pulled into shape), people have also used silver in jewelry, tableware and fine art for thousands of years. Industrial applications use silver's conductivity (the highest of any element for electricity and heat) as well as its sensitivity to light and anti-bacterial qualities.
Today silver is invaluable to solder and brazing alloys, batteries, dentistry, glass coatings, LED chips, medicine, nuclear reactors, photography, photovoltaic (or solar) energy, RFID chips (for tracking parcels or shipments worldwide), semiconductors, touch screens, water purification, wood preservatives and many other industrial uses. Washington-based industry group the Silver Institute calls it "the indispensable metal".
The biggest consumers of silver for industrial applications this past decade have been the US, Canada, China, India, Japan, South Korea, Germany and Russia. Over that time silver demand from older industries has faded, only to be replaced by new technological uses.
