SILVER IS MONEY.
Silver is my favorite asset to hold for long term savings and protection of purchasing power. In my opinion, it is the most undervalued asset in the world! I wanted to follow up my last writing: @jdawg/diversify-out-of-the-dollar with what I think is the best asset one can convert their dollars to in order to protect themselves and their families against the inevitable collapse of the banking system, U.S. Dollar, and all fiat currencies.
Why do I think silver is the most undervalued asset in the world and the best protection from a currency and banking crisis? We have to take a look back into history to begin to find the answer. Silver have been money for thousands of years. No other asset, aside from gold, has the history and exposure of being real money as silver does. Gold was considered to be the king's money and silver has been widely known as the people's money, therefore, it was more broadly used throughout the world.
The silver/gold ratio has been used throughout history to determine the value and purchasing power between the metals. It was generally based on mining production. The historical silver/gold ratio was around 16:1, meaning 16 ounces of silver could be traded for ounce of gold. This ratio has endured centuries, until modern times. Today's silver/gold ratio is an astonishing 73:1. It takes 73 ounces of silver to trade for one ounce of gold. Based on the historical silver/gold ratio, silver is 5 times more undervalued than gold. Today, silver comes out of the ground around 9:1 per ounce of gold. Based on the mining ratio alone, the gold/silver ratio should be 9:1 at the very least, making silver 8 times undervalued. I believe the silver/gold ratio could hit 1:1, making silver as valuable as gold one day. I outline several reasons for this below.
Silver is becoming more rare than people realize. Due to silver's amazing characteristics, it is widely used in industry. It has the highest electrical and thermal conductivity, and is the most reflective of all metals. Technology would not exist as it does today without silver. The electronic device that you are reading this article on has silver in it. Silver is also an anti-microbial making it widely used in the medical field. Silver has been consumed in various industries for decades. Most of this silver is gone forever. Compare this to gold, where most gold that has been mined is still in existence today. As technology continues to advance, the demand for silver will only increase.
The corrupt silver paper market and manipulation by central banks has caused the silver price to be kept artificially low. This is done by selling paper contracts onto the market. Billions of paper ounces are traded on the markets on a daily basis, far greater than the ounces of silver in existence. Very little if any of these paper ounces are actually backed by real physical metal. The price control of silver is so vitally important to the status quo of the banking system, that it is commonly called the Banker's Achilles Heel. Why is that, you ask? Why does this metal have such a powerful hold on the banking system?
The entire world is on a fiat monetary system, meaning nothing tangible is backing up the value of the world's currencies. Not one country in the world, at this moment, back their currency with gold/silver as was historically done. Although, times are changing! Countries like China and Russia are buying gold like crazy. The people of India hold as much gold and silver as many central banks combined! These countries know what is coming. I believe that all nations will have to back their new currencies with gold/silver once the current financial system meltdown takes place. In order to transfer your wealth into the new financial system, you will need hard assets that will protect purchasing power. Silver will do the trick!
The unbacked fiat banking system has created the massive global debt bubble in existence today making silver an even better asset to hold. Right now, global debt is around $217 trillion. Total derivatives worldwide are $1.2 quadrillion! When you look at these catastrophic numbers, it makes a hard asset like silver a screaming buy! When the next global financial crisis occurs, people will be scrambling for real safe haven assets. Gold, SILVER, and Cryptos will all benefit. Get in now before the rush!
Image by @sflaherty
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