The logic for investing in silver is very similar to the logic for investing in gold — it is a tangible hedge against inflation, unlike paper money, which has an arbitrary value. Two recent pivotal advantages increased silver's earning potential as compared to the earning potential of gold.
First, silver has many more industrial uses than gold, and its uses are expanding. It is used in everyday items, such as cars and computers, and it's essential to growth industry products, such as solar panels and water purification systems.
The medical field is taking advantage of silver's unique antibiotic properties to make medicinal paper. Because it's the best metal conductor of electricity, silver's importance is unequivocal in electronics. And, of course, silver remains a staple in jewelry, which is used around the world as an investment.
In simple supply-and-demand terms, the market is demanding more silver than mining and recycling can produce, which has caused a substantial increase in silver's value.
Silver has historically traded at a low price relative to gold, which means it offers more potential for some investors. In addition, because the media has covered gold extensively in the last few years, investors have focused more on buying gold, making it relatively more expensive than silver.
At one time in history, the price ratio between gold and silver was 16:1 and it rose as high as 81:1. It is constantly changing. Investors are realizing this potential, and we believe the price of silver will soon begin to rise again. This could be the time to buy silver at a low price in order to sell high later.
Some analysts report that the U.S monetary base more than doubled from 2008 to 2010, and U.S banks have increased their reserves by more than $1 trillion. When banks begin lending out reserves, inflation is likely to hasten.We believe the world will drown in excess money for a time, and if that happens, prices will rise. After that, who knows what will happen? We believe the best hedge against losing the hard-earned value of one's money is investing in precious metals, such as silver.
Silver protects wealth and, over the long term, consistently increases in value. In fact, increased silver bullion prices correspond directly with increases in the money supply. As you can see in the chart, the price of silver shot up around 2008 when the Federal Reserve dumped trillions of dollars into the money supply.
As banks release more and more money into the monetary system, the price of silver may greatly increase. We believe gold and silver will remain an important part of every American’s portfolio, including for some investors the rolling over of all or part of an existing IRA, 401(k) or other retirement plan into a gold or silver IRA. With the Augusta® Gold or Silver IRA you can actually SEE, TOUCH & HOLD®, you not only invest in physical precious metals that can keep your retirement safe, you get all of Augusta's unique advantages.
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