Silver Price

Weekly Google Plus 52 Silver 1 ounce Coins or Bars Giveaway

It is 2012 and we are giving away 52 Silver 1 ounce Coins or Bars.  Swiss Metal Assets is committed to bringing you the latest information on the Precious Metals and Rare Industrial Metals market.

Silver is a store of value and one of the critical metals according to the United States Geological Survey and the British Geological Survey.  Silver is so important to the world around us that we think that a weekly giveaway is in order.

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Silver bullion demand is skyrocketing in Australia

Investment demand to buy silver bullion in Australia is skyrocketing, according to Gold De Royale, Australia’s largest silver bullion dealer.

“With the US national debt crossing $15 trillion, investors are preparing for the worst-case scenario, hyperinflation,” according to George Vo, Sales Manager of Gold De Royale.

We have never seen this much demand for silver, with silver price at the perfect buying opportunity. Investors are doubling up their precious metal portfolio with silver bullion.

Investors do not want to hold money in banks these days, fearing a bank run. Moreover, the financial situation in the US is not getting better.

The so-called super committee in the US, who was set up to save $1.2 trillion, was not able to reach to any bipartisan agreement. Uncertainty in the US economy will lead investors to look for safe-haven investments, such as silver bullion.

“Since the collapse of Lehman Brothers in September 2008, sales of silver bullion have been very strong. For many silver investors, the white metal is seen as a more highly leveraged alternative to gold, with greater potential.”

Historically, the ratio between gold and silver has been in the range of 12:1 to 16:1. This meant that for each ounce of gold you could exchange it for 12 to 16 ounces of silver. Today, the ratio is near 50:1 as silver is undervalued relative to gold.

As gold price increases we will see that gap narrow. This provides investors a massive profit potential.

“Our market analysis is showing that the average price of silver bullion could rise to $45 an ounce in 2012, as investment demand is expected to support it”, said Gold De Royale. As investment demand increases, we could see silver reach higher than $50 by end of 2012. – Bullion Street.


Silver Q4 Outlook

The silver has made impressive gains since the downgrade of US debt renewed fears about the global economy. Now sitting at a price of $42.34 per ounce, nearly its highest level since April when silver nearly reached its historic $50 per ounce high. The main factor holding silver back from matching the run up in price seen in gold is the industrial component to silver’€™s demand. Investors fear that a slowing economy will dampen the industrial demand component to silver.

Both silver and gold have upside potential as the global economy is unlikely to make a dramatic turnaround by the end of Q4. This is a key factor behind some of the world’s largest banks to revise their price projections for silver in the coming months.

Ongoing economic concerns
On top of the downgrade of US debt, an unexpected rise in jobless claims, as well as mounting speculation surrounding another round of easing measures from the Federal Reserve have added to the recent rally in precious metals prices.

Gold and silver are €œbeing lifted by expectations that the failure of the US economic recovery to gain traction will force the Federal Reserve to embark on a third round of quantitative easing, which essentially translates into printing money,€ reported Jan Harvey for Reuters.

Loose monetary policy has been the single most powerful argument of gold and silver bugs since the economic collapse of 2008. If a third round of quantitative easing measures comes from the Fed, most analysts expect aggressive buying of silver and gold.

The Eurozone is no better off. The ECB lowered its growth forecasts, which sent European shares falling early in the week. Growing fears of a recession and more evidence of political disunity in the Euro zone hampers the regions ability to solve the debt crisis.

Price forecast

Recently, UBS upped its price forecast for silver and gold, but warned that a correction to the precious metals rally is an increasingly possible scenario. The bank noted that volatile trades may come with rising margin requirements in Chicago and Shanghai, as well as ahead of Ben Bernanke’s speech on Friday.

Edel Tully, an analyst with UBS commented, “€œthose who have missed out on the last few hundred dollar rally in the gold price perhaps believe that gold is near its short-term peak. And instead of playing gold from the short side, they prefer buying silver.”

UBS raised its price forecast for silver for one month prices up from $35 per ounce to $46 per ounce, and three-month prices to $50 per ounce up from $33 previously. The key short term resistance level is the $44 per ounce mark. Silver yet to breakthrough $44 since pulling back from over the $48 highs in April.

For the long term, if silver can break through the $44 level, as UBS forecasts for the next month, then the $50 per ounce mark seems to still be the psychological resistance level for silver market observers.

One can only speculate what events will have to take place to break the high water mark for silver. The implementation of QE3 from the Fed? A meltdown of stock markets worldwide which would mark another economic collapse?

Regardless of the doomsday scenarios, the global economic recovery is not gaining traction. Further debt concerns and loose monetary policy will continue to support silver. If the key short term resistance level of $44 per ounce is breached, most analysts expect silver to continue upward to the $50 mark before significant profit taking occurs.

By Michael Montgomery

China Buying Silver to $100 Plus an Ounce

Chinese demand to Buy Silver for solar panel manufacture will push the price to three digits, says this fund manager…

MANAGING big-cap growth stock market funds since 1999, Stephen Leeb ,chairman and chief investment officer of Leeb Capital Management,€“ has recently been a big proponent of silver, calling for the Silver Price to rise above $100 an ounce, despite its record price being half that.

Here Stephen Leeb talks to Hard Assets Investor’s managing editor Drew Voros about why he believes demand to Buy Silver, particularly from China, will push the commodity up to three-digit prices.

Hard Assets Investor: You have declared that silver is a “three-digit” commodity. Why?

Stephen Leeb: I think there are two crucial fundamentals. One, silver’s a monetary metal, although not as widely recognized as a monetary metal as gold right now. But it certainly has a history of being a monetary metal. People will price it for that. You have a race to the bottom in terms of all the current reserve currencies, like the Euro and the Dollar. The action in gold is certainly evidence of that. The fact that silver’s price [has been] holding in the upper 30s is pretty good. There’s a lot of downside protection in silver because of its monetary component.

On the industrial side, silver is critical. Silver has properties that cannot be duplicated on many levels. It is the best thermo-conductor of anything that’s found. It conducts heat better than anything else. It conducts electricity better than copper or anything else. And, it’s one of the best reflectors. Is it really surprising then that silver is a critical component on most solar applications? China right now is spending about $1 trillion a year on alternative energies. China controls the solar industry. They have at least 50% market share. They’ve been underbidding, undercutting everybody in the development and acquisition of polysilicon. After which comes silver. In order to build these solar panels, you need silver.

You have a potential, utter squeeze coming on silver, a monetary metal with critical industrial applications. The Silver Price is trading around $39 and hasn’t even come down 10% since the market started sliding. It’s a great hedge in deflation. You’re going to have demand for silver coming from two places, which I don’t think you’re going to be able to satisfy, given that silver production today is rising at a much slower rate than it was in 2010, despite the fact that Silver Prices are higher. That dictates dramatically higher prices for silver.

HAI: Do you think the solar element is something that is being overlooked in terms of the demand?

Leeb: Totally. China will start Buying Silver much more aggressively and start accumulating it. There’s very little doubt in my mind that China will be accumulating massive amounts of silver.

HAI: For silver to achieve three digits in price, would it be a slow, steady march, or something that would rocket up?

Leeb: I don’t think it would be a single event. I wrote a book, The Oil Factor, and in it I made the call for $100 [a barrel] oil. I said “three digit oil”. When the book was published in 2004, oil was around $30 or so, about the same price as silver is now. It took about three years to get to three digits. But there was no event that triggered the big jump in oil prices. There has been no event that has triggered the big jump in Euros, other than the gradual realization that there are no reserve currencies in the world that are worth a darn. The same realization will keep silver in a strong, long-term uptrend. I think people are going to be very surprised, very surprised, when the Silver Price just goes past $50.

HAI: Is $50 the figure that, once it breaks through that, it can take off, or is it further up the line?

Leeb: No, people make too much of these breakout points. If it goes to $50, it’s likely to go to $51 pretty quick. I’m sort of being funny. I don’t think that it’ll tick at $50, and then the next tick will be $80. If it goes to $50 it will likely get a little pop, maybe low $50s or mid-$50s and walk around there for a while and then go up again.

HAI: Do you think that that would happen independent of gold?

Leeb: It will be independent of gold. I think all commodities are going to have to go a lot higher. I just don’t think there are enough commodities out there to build out renewal or alternative energies. I don’t think China realizes it. I mean, you’ve got peak [price] coal, you’ve got peak oil, peak everything. Silver, even without the monetary component, would make it into three digits.

HAI: You seem to have a bullish sense of growth; global growth as well?

Leeb: I wouldn’t say global growth. I’m bullish on Chinese growth. China’s a wicked enemy of ours. They’re monopolizing resources. They’ll continue to do that because I think they’re looking out for their own. It’s hard to have a totally bullish outlook on growth when you’re looking at resource scarcities that are going to affect China as well.

HAI: Do you think that gold and silver are in the same asset class?

Leeb: They’ve never been in exactly the same asset class. There’s no industrial use for gold. It’s become ever-more recognized as a possible reserve currency. Silver does have industrial uses. It’s industrial vs. nonindustrial. They’re totally different classes. But silver overlaps. In a diagram, you would have silver in both sets: the industrial set as well as the monetary set.

HAI: What fundamentals of silver do you worry about? What would change your opinion?

Leeb: A lot of it has to do with China. What would change my opinion? If we found other ways of creating solar energy that did not involve silver, and I don’t see any on the horizon, that certainly would merit reconsideration. If China collapsed, then the calculus surrounding the world totally changes, including silver, but not just silver.

HAI: How should a retail investor approach silver as an investment?

Leeb: I would approach precious metals as an asset class in and of itself. As an asset class, you try and diversify within the class. There are the commodities themselves, which you can buy through an ETF or you can buy through coins. There are lots of ways of participating. There are senior miners. There are junior gold miners, like NovaGold, which happens to be one of my favorites. Not only does it mine gold, it has a lot of copper. There are going to be seniors like Goldcorp., like Barrick.

HAI: What would you suggest for an asset allocation in precious metals?

Leeb: It makes sense to weight it at least on the same level as you would weight stocks. Whatever your highest allocation is, precious metals should be higher than that allocation.

22 August 2011

The 2011 Silver Quiz

CPM Group recently released their 2011 Silver Yearbook, one of the industry’s most comprehensive sources of information on the silver market. Though mostly a reference book, I uncovered some interesting facts that paint a decidedly bullish picture for the metal going forward.

If you’re a silver investor, or are concerned about the recent sell off, you may find the following data very compelling. It provides an inside track on the market and will certainly make us all more knowledgeable investors.

For fun, I put what I read into the form of a quiz. See how many you can get correct…

1) The #1 driver for silver’s price increase in 2010 was:
a) Investment demand
b) Fabrication demand
c) Lower supply

While both fabrication demand and supply rose last year, investors bought 142 million ounces of silver - the third highest level on record, and the highest since 1980. This pushed the price into record territory.

It’s noteworthy that investment demand was higher last year than during the recession year of 2009. This suggests that investors buy silver more out of dollar devaluation and inflation fears than simply due to an economic contraction.

2) Silver mine production:
a) Exceeds demand
b) Matches demand
c) Falls short of demand

Silver produced from worldwide mining totaled 667 million ounces last year - but total demand hit 986 million ounces. Despite the fact that mine production has increased 33% since 1999, it falls far short of supplying the market’s needs. While scrap coming to market makes up the difference, this gap is one of the more critical issues going forward. The delicate balance between supply and demand will become increasingly precarious as overall demand continues to grow.

3) Household demand for silver (cutlery, flatware, and candlesticks) hasn’t risen in ten years. Jewelry fabrication is up but a blip. Silver use in photography continues to fall. So, true or false?: Total demand is falling.

False. Industrial use has more than made up the difference from declines in other uses, and is pushing demand to new levels. Since 1999, consumption in electronics has increased 120%. Silver usage in solar panels began in 2000 and is up 640% since then. Silver was first used in biocides (antibacterial agents) in 2002 and, while a small niche, it has already grown sixfold. In fact, new uses for silver are being found almost every day, particularly in the biocide arena, making it increasingly difficult to catalog all its growing applications.

The Silver Institute forecasts that total industrial use of the metal will rise 36% over the next five years, to 666 million troy ounces annually. That’s a lot of silver, meaning this portion of demand - which is roughly 60% of all fabrication - isn’t letting up any time soon.

4) Silver represented what percent of global financial assets at the end of 2010?
a) 1.7%
b) 0.7%
c) 0.07%
d) 0.007%

D. In spite of last year’s record-high prices, silver is, by any account, a miniscule portion of the world’s wealth. The ratio’s high occurred in 1980, reaching 0.34% of financial assets. Silver as a percentage of global assets would have to grow over 48 times to match the record. It is true that many more paper assets exist today than 30 years ago, but the renaissance in silver will continue to increase its portion of worldwide assets.

5) The largest manufacturer of silver coins is the U.S. Mint, which sold 34.7 million ounces last year, about 46% of the world total. What country is the second largest?
a) Austria
b) Canada
c) U.K.
d) South Africa

The Austrian Mint contributed 15% of total silver coin sales last year (11.4 million ounces), an increase of 26% over 2009. Still, the American Silver Eagle rules the global roost. Given how recognizable it is around the world, it’s what to buy if you don’t own enough metal.

6) Of the following groups of countries, which is increasing silver production and which is in decline?
a) Mexico, Australia, China, Argentina
b) Peru, U.S., Canada

Countries in group A are increasing production, while to the surprise of many, each one in group B is in decline. This has direct ramifications for your silver stock investments. Total newly refined supply is expected to surpass one billion ounces for the first time in history this year, so make sure you have some exposure to countries where production is growing.

7) The average cash cost to produce an ounce of silver from primary silver mines is:
a) $7.16
b) $6.16
c) $5.16
d) $4.16

Of the 30 primary silver mines in the world, average cash cost range in at $5.16 per ounce (net of byproduct credits). This is almost double 2002 levels. The silver price has risen 650% in the same time frame, however, so margins have risen in spite of higher costs.

The only governments that hold silver in inventory are the U.S., Mexico, and India. How many combined ounces do they hold?

a) 55 million
b) 155 million
c) 255 million
d) 355 million

Only 55 million ounces are estimated to be stored in these three countries. This equals only 5.6% of annual global demand. Governments held approximately 355 million ounces in 1970, but this has diminished largely due to the U.S. decision to stop using silver in its currency in the 1960s and other governments following suit. No other countries are believed to hold any silver in inventory. Mine production and scrap supply had better keep up, because there is no backup source.

9) China accounts for how much of worldwide mine production?
a) 9%
b) 11%
c) 14%
d) 16%

Chinese mine supply totaled 102.7 million ounces last year, 16% of global production. China is the third largest silver producer, behind Mexico and Peru.
Mine production in China has more than doubled just since 2000, largely due to Beijing’s decision to deregulate the state-controlled market the year before. This trend is certain to continue, due to rising silver prices and the fact that many parts of the country are under explored. If you don’t own a Chinese silver producer, you’re missing out on some of the most explosive growth around the globe.

10) What is the weakest month of the year for the silver price?
a) January
b) June
c) July
d) October

Summer is usually the most sluggish time of the year for silver, and July is historically the weakest. Got your dealer’s number handy?

It’s clear that the forces underpinning the silver bull market aren’t going away any time soon. Demand is high, but it’s not an anomaly when viewed through an historical lens. Silver has been used as money for over 3,000 years, and the word for “money” in many languages is “silver.”

Meanwhile, our current monetary issues are far from over, won’t be easily resolved, and will take years to play out. Precious metals are proven forms of protection for this environment. Silver, along with gold, is your best defense against unsustainable fiscal imbalances and massive currency debasement, and will be a profit center for years to come.

Jeff Clark, BIG GOLD

Silver Will Reach An Unbelievable Price and Outperform Gold

By Mark O’Byrne | February 2, 2011 7:13 AM EST

Hopes of economic recovery swept stocks higher in New York yesterday and this confidence spread to Asian equity markets. European stocks are tentatively higher as concerns about Egypt and geopolitical risk may be hampering gains. Oil prices remain near recent record highs (brent rose above $102 a barrel) and there are hopes that geopolitical tensions will subside, markets will remain calm and there will not be panic buying of oil and a new oil crisis.

Silver is marginally lower today in all currencies, but recent action suggests we may have seen capitulation and are in the process of bottoming out. Physical demand remains robust and both jewelers and investors are using the sell off as an opportunity to buy on the dip.

Demand for US Silver Eagles exceeded the record of monthly sales in 1986 by nearly 50% with 6,422,000 one ounce silver bullion coins sold. Yesterday alone saw another 50,000 Silver Eagles sold showing that physical demand for silver remains very robust. Reports of shortages of 100 ounce silver bars are overstated at this stage but there is certainly a degree of tightness developing in the market that we have heretofore not experienced.

Premiums for gold bars in Hong Kong and Singapore remain at the highest level since 2004. While Chinese New Year demand has ebbed, wedding season in India is next month and Indians will accumulate on the dip as they always do. Gold imports in India, the world’s largest consumer of the precious metal, already rose 18 percent in January to 40 tons. Indians buy gold, and increasingly silver, jewelry at religious celebrations and weddings and use it as a store of value.

Legendary investor Jim Rogers speaking to investors in Amsterdam this morning, said that gold is still far from being a bubble and investors should sell bonds and buy precious metals. The chairman of Rogers Holdings, who predicted the start of the global commodities rally in 1999, said that “gold should have a rest but it’s far from being a bubble yet.”

“Gold will have reached an unbelievable price before it starts falling,” Rogers said, who owns gold but prefers silver due to it remaining cheap relative to gold and cheap on a historical basis.

Rogers recently said “silver is going up, but silver is 40% below its all time [nominal] high. Yes, commodities have been going up recently, but they are still extremely depressed on a historic basis.”

(Zero Hedge) — US Mint Sells Absolute Record 6.4 Million Ounces Of Silver In January, 50% More Than Previous Highest Month

As the topic of US Mint silver sales is not new to our readers, after we first brought attention to the record January sales by the Mint, we will not dwell much on it, suffice to say that the final January tally is in. And at 6,472,000 ounces, this is nearly 50% higher than any prior month in the Mint’s 26 years of published sales history. This has occurred, despite supposed profit taking in the paper silver market in January. And just today, another 50k, were sold. It seems that physical buyers continue to enjoy the dip in paper silver that is providing them with an attractive entry point.