Just look at what the different governments around the world are doing right now. They are buying gold by the tons, literally. Actually, they buy in tonnes, which in the metric term is around 2,200 pounds. Now what happens when a country is in financial trouble, like Venezuela in 2016? They owe a lot of debt to other countries, but their paper currency is in hyperinflation. So nobody wants their paper. But they will take Venezuela’s gold. If someone is living in Venezuela, that hyperinflation makes basic tasks like buying food insanely difficult. Is Venezuela turning into Zimbabwe 2.0?
An ounce of gold at this moment is about $1200 an ounce. The average American’s savings account has about $1000 in it, according to some recent survey found somewhere on the internet. Apparently, half the news that is coming out is now fake news, so who knows? But I’m guessing most Americans aren’t sitting around throwing cash at gold coins on a daily basis. Thus, gold is left primarily to world governments, the wealthy 1%, and this guy:
But with the same price as 1 ounce of gold, you could get your hands on about 70 ounces of silver currently going for under $17 an ounce. The affordability of silver is why it is often referred to as the “common man’s gold”. Most people with even a little bit of disposable income could own their fair share. Let’s say in the slim chance a Venezuelan situation ends up arriving at your doorstep due to circumstances beyond your control, wouldn’t it be nice to hold an appreciating asset that will protect you if your paper currency starts to rapidly lose its value? Let’s say a Venezuelan situation never happens, wouldn’t it seem to be a good insurance policy to have for a small portion of your assets, while you continue to go about your day as usual?
The surface area for 1 ounce of silver is also quite a bit larger than 1 ounce of gold. Much more artistic creativity can be applied to the design on an ounce of silver. Therein lies the additional collectibility factor, and the higher artistic demand can also play a big part in potentially driving up the price. People who collect Picasso’s or Van Gogh’s or any artist of their choice are just like silver collectors – they can’t help but marvel at fine art. The only difference is art collectors are more likely to drink tea with their pinkies sticking up.
Silver is an excellent and unique form of investment. It’s a precious metal that has been considered money for thousands of years. It’s cheap enough that almost anyone can own at least a little bit. It can’t be devalued the way paper currency can be devalued by bad monetary policies. It even has industrial purposes that aren’t going away anytime soon. And for the astute collector, there can also be an artistic value that can potentially lead to outsized gains. It certainly wouldn’t hurt to take a closer look at silver with all of its merits.