The current dip in commodity, gas and stock markets has turned the investors to the rising USD. The credit rating agencies are busy downgrading all major financial and political authorities in the EU paralyzing the investment capacity that the EU once had. The falling prices of precious metals has led to the fading status of them being a safe haven investment but how long is actually going to stay like this? The abundance of paper silver has severely devalued physical silver and with recent lows of sub $29/oz. the trade volumes have been of astronomical proportions. The volume of silver in bullion form is a rather small residual of silver mining industry. Due to the increased trading volumes since September, the current system of silver pricing is going to collapse.
So the question still stands, if silver is worth investing and the answer is YES to physical silver and NO to paper silver (silver bonds). The current way of trading silver as a commodity has highly diluted the real value of silver. The recent drop of silver prices and the abundance of paper silver has only made physical silver a commodity worth investing. The volatility in recent times is not for the ones with a weak heart. The mining stocks have performed only moderately in the last quarter with lower earnings compared to last year when the market was much more bullish. Silver Technical Analysis gives you the recent insight on what transformations Silver prices have undergone due to the downturn of EU. The weaker markets have had a massive impact on industry and mining sectors and while the financial institutions get their act together in North America and Europe, commodities will consolidate over a period of time during which major bailouts within and outside of EU are going to happen trying to regain consumer confidence. All this might very well be too late but if this financial crises are fought seeking a more global and sustainable solution then we MIGHT delay the inevitable. The current credit system needs a major overhaul giving value to more resource based economies like Canada. Canada has a substantial on and off shore mining infrastructure makes it a economy that comes under global spotlight. Where silver is headed to ? What are the next significant levels of support and resistance? Are we going to see different spot prices for physical and paper silver? if yes, then how soon? These are some really important questions that Silver investors have wondered for decades. The big banks finally breaking down has tabled the flaws of the banking system in the US. The Euro is on life support and will never be as powerful as it used to be at one point.
Silver is highly under appreciated while Gold enjoys a safe haven tag. What the experts believe is this could very well be the last time you will see sub $30/oz prices. Start accumulating physical silver. ”A bank is a place where they lend you an umbrella in fair weather and ask for it back when it begins to rain”.
Robert Frost (1874-1963)