Economy and Finance
Stealth Silver Depletion = Greater Gains
Silver has experienced an ever increasing rate of depletion for the last 60 years. Furthermore, most of the silver which is easily accessible in the ground has been taken already. Industrial demand alone is increasing at about 18% per year, as new industrial applications keep emerging. Moreover, investor demand continues to increase at a staggering rate, especially in emerging nations.
A look at some of the fundamentals which underpin the silver market will help remind our readers why G.I. Metals DMCC holds that silver will ultimately outperform gold, and what type of highs we might eventually see in an inflationary – and not hyperinflationary – environment. With current levels of central bank intervention to solve sovereign debt problems, we expect to see more economic contraction for the first part of 2012, followed by even more excessive money printing which will lead to inflationary, and eventually hyperinflationary, conditions. This only requires a greater level of velocity to occur, along with a loss of confidence in the world reserve currency, which we expect will begin to happen when bond speculators’ attention is moved from Europe to America.
A revision of these fundamentals will also help remind us that physical ownership of silver should not be viewed as much as a short-term investment, but rather, a mid-term form of wealth preservation and growth. We see these types of scenarios most likely playing out within the next 1 to 3 years.
Full Article at www.myglobalinvestments.com
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