Silver, like gold, has been a valuable commodity for centuries. It has the ability to be used as money itself, while also being used for many other applications. Indeed, silver has many unique properties that can be utilized in modern society. Silver is the most conductive metal on the planet, and is therefore used in other sorts of applications, such as solar panels and automobiles. It also is highly antimicrobial, and so is used in clothing and the medical field at an increasingly high rate. As a rare metal, silver is not nearly as scarce as gold, so it is also more accessible for people with less money. All of this combines to create an interesting precious metals outlook for silver over the next few years.
The Truth about Silver Investing
Since silver is such a highly used and sought after metal, one would think that it would be universally recommended as an investment for those looking for security. However, the precious metals outlook is sometimes seemingly affected by a faulty assumption in today’s society that precious metals are outdated and old fashioned. This could not be further from the truth. In today’s unpredictable market, precious metals like silver are experiencing a revolution in investment, as investors look for a hedge against the troubled times.
Specifics about Silver Investing
Silver, against some experts’ opinions, still has an excellent precious metals outlook. Silver had reached $234 per ounce in price, but has fallen to around $50 per ounce lately. This has prompted some to be wary of this precious metal, yet this fear is unwarranted.
One reason for the wariness about silver is the fact that Federal Reserve Chairman Ben Bernanke has recently announced the central bank’s plan to slow down purchases of assets. This usually pushes up interest rates, which often hurt the precious metals outlook as investors rush to buy investments with higher returns. However, there is a complicated reason as to why this actually is good for silver.
Higher interest rates mean that the national debt and also the mortgage market will both be affected. This will lead to higher taxes from which to pay the interest on the nation debt, and it will cause homes to be less affordable, which will cause homes to lose value as they seek buyers. Both of these problems will cause consumers to stop spending their money, which in turn will hurt the economy that was supposed to be bullish in the first place. As interest rates and debt continue to expand, the dollar will continue to be devalued as the American government’s money printing increases. Silver, then, as a tangible and finite investment, will increase in price as the dollar loses ground. So, when the Federal Reserve tapers the purchasing of assets, which often signals the start of a bullish market, they are actually hurting the economy and providing a great precious metals outlook, especially for silver and gold.
Security in Silver
Silver is an excellent investment now, as always. With world currencies losing ground, the entire globe will be looking for alternative forms of money that have real value. Once the dollar, in particular, collapses, then silver and other precious metals will be extremely commonplace once again. Given that these are rare and finite forms of money, their prices will skyrocket. Silver itself is usually 1/15th the price of gold, though it is far below this ratio right now. However, it will correct itself, and, as a more unpredictable investment than gold, may even go past the normal ratio to even higher prices.
Therefore, the precious metals outlook for silver is bullish. With unstable economies being the name of the game today, real investments will provide real security. They also provide a hedge against the bail-in threat, where governments seize bank accounts that have too much cash. This is an attempt to save large banks, but devastates the owner of the accounts. Precious metals, then, are a safe investment because of value and also because they don’t have to be stored in banks. All of this leads to a wonderful precious metals outlook for the foreseeable future.