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The U.S. mint
sold 2,170,000 silver eagles and only 26,000 gold eagles in the month of
January. By my calculation 83 times more silver eagles were sold then gold
eagles. This is an enormous difference that shows you how much more interest
there is in silver. Investors are starting to understand that silver is a
better investment then gold. I congratulate Mr. Butler that by his writing
about silver, more and more people are buying physical silver.
In my opinion, the beauty of silver is that any amount of silver you
buy will reward you tremendously. Maybe only 0.5% of the world population has
heard about silver and they are mostly American investors who bought in the
last 15 years around 400 million ounces of silver.
Today, many silver
investors are asking why silver doesn't achieve all time highs like gold. Mr.
Butler answers this question every week by emphasizing the control of prices
on the COMEX by 4 or less traders that hold more than 50% of the net short
position. When you hold a position of more than 50%, you control the market. This
may be changing now. The short position is the main reason why the price of
silver is behind the gold price, but this creates the opportunity to buy
silver.
Different people have
different opinions or expectations for future prices. I personally believe
that only silver can be characterized as real precious metal and gold is a
second violin. I made this decision by understanding the rarity of the metal
and its world stocks. Let's look at gold first: its world stocks increase
almost 100 million ounces annually. Contrast this to silver, which is in a
yearly deficit and is decreasing yearly. World gold stocks are around 5
billion ounces and silver around 1 to 2 billion ounces. I say with conviction
that silver is more rare than gold and, in my eyes,
is the only precious metal. I think investors are beginning to understand
that a shortage can develop easily in silver, but not so in gold, because it is not used that much industrially. It is
a lot easier for people to pay $15 or $20 for an ounce than $900 or $1,000,
especially when the cheap one has the most value.
If 90% of the world
population knew this, the prices of silver and gold would be different. In
the short term, with gold prices over $900, silver would be in the hundreds. Mr.
Butler doesn’t like my numbers. He says that they are too extreme and
people are going to lose confidence in my writing, but I hope he will not
censor me, because this is my
opinion. Silver in the hundreds of dollars will come only with a shortage of
silver. The 4 or less shorts will give up. With a shortage, world investors
will recognize the rarity of silver.
Gold and silver seem to
trade together, tick by tick. It is easy for many people to think they are
the same commodity. Not true. Gold and silver are very different, even if
they behave now as one. I am certain that will change, and perhaps very soon.
You don’t have to look very far to see just how different silver is
from gold.
Some of you want to hear
how I see the future in silver prices and what I think about the world in my
crystal ball.
(1) Life expectancy will
rise tremendously and most of you will live over 100 in years to come.
(2) It will be very
important to save and prepare for a long life.
(3) Investment in
education----silver----farmland, in my opinion, will do the best.
(4) At some point, in 15
to 20 years, silver prices will be 5 times higher then gold prices. If my
calculation is correct, a dollar invested in silver will do many times better
than gold. In real estate value, I think 1,000 ounces of
silver will buy a 3-bedroom apartment in Manhattan
in Trump Towers.
I am a different thinker,
and some gold investors don't like my opinion, but that is their problem.
Those who believe in silver
value should buy eagles and force the mint to work overtime.
Israel Friedman
www.investmentrarities.com
(No one can safely predict the future and
it’s possible that Israel
Friedman’s Butler’s
analysis will prove incorrect. Silver can go up, but silver can go down. It
is up to you to read, analyze, and arrive at your own conclusions. Prudence
requires we emphasize that precious metals may or may not prove to be
suitable for your consideration.)
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