SILVER
Thinking about investing in silver? Here's your essential guide to the
history, culture and science of one of the most remarkable metals known to
man.
. The Periodic Table lists elements
in order of atomic weight. At 47 on the table, silver is represented by 'Ag'
from argentum, the Latin description for white, shiny metal. . Silver
is one of the seven so-called 'metals of antiquity' which mankind identified
and found uses for thousands of years ago. . First
mined around 3,000 BC in a region now part of Turkey, silver was originally
refined by the process of 'cupellation', which uses high temperatures to
oxidize and remove base metal impurities. . Because
of its resistance to oxidation and corrosion, silver was known as a 'noble'
metal, a group which includes gold and platinum. . Soft
enough for early craftsmen to work into intricate patterns, silver was ideal
for making ornate objects. In fact, it can be stretched into wire thinner
than a human hair. . Adding to the attraction of
silver as ornamentation, it is one of the most lustrous of all metals when
polished.
. As well as its long association with
jewellery, silver has been used in the manufacture of cutlery and tableware since
Roman times.
. Sterling silver was invented
in the Middle Ages. It contains 92.5% silver and 7.5% other metals (usually
copper), giving it hardness and strength for use in functioning objects.
. Because silver is durable, stable and
intrinsically valuable, it possesses qualities that make it ideal for use as
money. . Made from electrum, a naturally
occurring alloy of silver and gold, the first coins are said to have been
invented in ancient Lydia (modern-day Turkey) around the 7th century BC.
. In reality, gold is too rare and simply too
valuable for everyday transactions. . With the
discovery of a silver mine near Athens, the ancient Greeks became the first
people to use silver coins extensively. . In
Britain, a pound coin originally weighed one troy pound of silver.
. In Spanish (plata) and French (argent)
the word for 'money' and 'silver' can be interchanged; the Indian rupee
derives from the Sanskrit wordmeaning 'wrought silver'. . Huge
deposits of silver were discovered in Spain's South American colonies in the
16th century, accounting for the lion's share of world production
for around 300 years. . The discovery of silver
in the Bohemian town of Joachimsthal led to the production of
Joachimsthalers, large silver coins that became known as thalers, daalders,
and ultimately dollars.
. The last Australian circulating coin made
predominantly of silver was the 1966 round 50 cent decimal piece. Due to the
rising cost of silver, its bullion value became higher than its face value,
which resulted in its withdrawal. Three of these coins make a full ounce of
silver.
. Although silver does occur
naturally in pure form, it's mainly found in silver bearing ores with copper,
copper-nickel, lead, and lead-zinc. . The giant
Comstock Lode, the richest silver deposit in American history, was discovered
in Nevada around 1857. . It's estimated that
there is roughly 15 times more silver in the Earth's crust than gold. . The
top five producers of silver by country today are Mexico, Peru, China,
Australia, and Russia. Annual average global mine production is reported at
about 670 million troy ounces. . Because it is
the best thermal and electrical conductor of all the metals, silver
is found in countless electronic and modern technological devices. . Silver
has antibacterial properties, which means it is a useful ingredient in wound
dressings and water purification. . Silver is an
important constituent in photovoltaic cells and thus in demand for the
proliferating number of solar energy panels.
. The majority of silver is today accounted
for by these and an extensive list of other industrial applications,
including batteries, bearings, brazing, soldering, inks, printing, and automotive
industries, which underpin global demand.
. The gold/silver ratio
describes the number of ounces of silver required to purchase a single ounce
of gold. Throughout the 20th century the ratio averaged about 50:1. . When
oil executives Nelson and William Hunt attempted to corner the market in 1980
by acquiring vast amounts of silver, rising prices drove the ratio down to
17:1. Seeking safety in gold at the start of the 1991 Gulf War, investors
pushed the ratio up to 100:1. . Sometimes
referred to as "poor man's gold", silver nevertheless has a
reputation as an effective store of value which has retained its purchasing
power over long periods of time. . The price of
silver reached its all-time high of nearly US$50 in January 1980. After
slipping back toward just US$4 in 2001, it again tested US$50 in April 2011.
. In theory, at least, silver is counter-cyclical
to other asset classes, experiencing greater investment demand during events
such as the Global Financial Crisis. In better economic times, say its
proponents, more demand can be expected for industrial applications. . History
shows that the price of silver is more volatile than gold and that this can
offer shrewd investors the opportunity to "buy low and sell high".
. Accredited by the London Bullion Market Association,
The Perth Mint refines and fabricates bullion bars and coins for investors in
99.99% and 99.9% pure silver.
