The European Central Bank has been able to stop purchasing Bonds now that they feel the debt crisis has stablizied and are on and off to better investments with which to prop up the EU economy. As we discussed last week, the metals, all of them, but especially silver which was trading well below it’s normal price index to gold, has the highest potential for gains, no matter which way the markets decide to turn. This is because silver has so many different facets. It is very undervalued at this price as a hard asset currrency. It is undervalued as a component in military guidance systems and also in computer generated systems and other industrial assets. One of the reasons this is so important is that unlke gold, which is ordinarily just changing hands, and perhaps being made and remade into beautiful pieces of jewlery or coins, the gold supply per se does not shrink or get used up. It only swaps owners and perhaps form.
Silver, on the other hand, DOES dissapate each year. Once used up, it cannot be replaced, so therefore, it has more of an intrinsic value than gold, as when the silver is mined and brought to market, it does not just trade owners, it goes from either coins or jewelry to forms that actually use it up and when it has served it’s purpose in this manner, it is no more. Also, technically, the precous metals do not look as if they will break the downside support levels and since the crisis in Egypt did not tank the entire market yesterday as it did on Friday, though it still has quite an effect on Brent Crude, analysts and techincal traders are looking for a sideways trading day, barring any major developments coming out of Egypt.
This international unrest has served to help increase the value of the minted coins, both gold and silver, even while the price of the underlying metals has risen slightly, the value of the coins has increased greater than the underlying metals. There is never a bad time to purchase gold or silver coins, and now, with more upheavel gatherine on the horizon, many experts agree that now would be an ideal time to either add to one’s collection or begin one. Since so many Agricultural experts are predicting food shortages this spring worldwide, and the chaos in Egypt started out as unrest over the shortage of and absurd prices of the food that was available, there is much credibility in these statements.
Break out the silver polish, just keep it away from those minted coins that are untouched by human hands!