SILVER IS ALSO A GREAT OPTION

It’s advisable  to get some gold. Perhaps you’re probably wondering if it’s too late and that’s really what I’m talking about. Longer term, government counterfeiting is set to destroy paper currencies so I think it’s dangerous to not at least have some gold set aside  even at the current price.

But if you’re worried you’re missing out, you might want to consider gold’s little brother: silver…

Over the years, there’s been a ratio of gold to silver of 50.

That’s to say, if you divide the price of gold by the price of silver, you should get 50.

More than that, and silver is undervalued and vice versa.

Gold is about $1000 an ounce and silver about $16, so that makes the ratio 62, meaning silver is cheap in relation to gold.

This could well be the next commodity China wants to accumulate (and send the price soaring). Unlike gold, silver isn’t just a precious metal; it’s used in many industrial applications.

Even better, China is encouraging its citizens to buy silver (as it’s cheaper for them than gold) to defend against Washington’s counterfeiting.

The trouble with silver is that it’s quite impractical to store it

It would take 62 silver coins to equal just one gold coin currently. Another way to is play it through a silver fund like SLV and/or a silver royalty company like Silver Wheaton (SLW).

But all this is assuming Dow Theory works as it’s supposed to and this psychological rally continues regardless of all the ugly fundamentals.

We’re at an important crossroad in any case and money will be made and lost. Now is definitely not the time to be asleep at the wheel.

ADVICE–BUY GOLD & SILVER NOW

Published by Henry Sapiecha 15th Sept 2009