If you've followed some of my earlier posts you know that I am very bullish on silver, meaning I think the price is going much, much higher from here. Silver is now trading for $30 an ounce, but I have no doubt that one day we will see a triple-digit price in the precious metal. Not only is silver investment on the rise with people buying coins and bars, but silver's industrial use is also increasing every year (mainly because of China's demand for it).
I'm going to outline silver's many uses here in technology, and then give you my long-term price forecast:
The Many Uses of Silver
Solar Energy - According to the Silver Institute, Solar energy is cost-effective, environmentally responsible and provides an immediate source of power. "From single-family homes to
What many don’t know, however, is that silver is a primary ingredient in the photovoltaic cells that catch the sun’s rays and transform them into energy, the Silver institute states. "90 % of crystalline silicon photovoltaic cells (the most common cell) use silver paste and over 100 million ounces of silver are projected for use by solar energy in 2015."
Silver in Water Purification - The Silver Institute also says that Silver is used in water purification. It "prevents bacteria and algae from building up in their filters so that they can do their job to rid drinking water of bacteria, chlorine, trihalomethanes, lead, particulates and odor. Research has shown that the catalytic action of silver, in concert with oxygen, provides a powerful sanitizer that virtually eliminates the need for the use of corrosive chlorine."
Windows and Glass - "Over 250 million square feet of silver-coated glass are used in homes in the US each year."
With energy costs rising and interest in the environment at an all time high, it is likely that silver-coated glass products will only grow in popularity in years to come."
Very bullish for the price of silver!
Other Main Uses of Silver: Batteries, bearings, electronics, catalysts, brazing, automotive industry, jewelry, silverware, photography, insulation, tableware, coinage, medicinal uses, etc.
I expect demand for silver to only increase over the next 5-10 years.
While silverware and photography demand are down, silver coin demand and industrial applications are through the roof.
Coins and Medals - 2001 total demand was 30 million ounces. that number has grown to over 100 million in 2010.
Industrial Applications - 2001 total demand was roughly 350 million ounces - that number for 2010 was 487 million!
Implied Net Investment - This is silver bought in paper market like ETFs and Mutual Funds, etc. Total 2004 was 29 million. In 2010 the number was 178 million ounces!
Ratio of Gold to Silver: The historic ratio of both metals is 16:1 meaning 16 ounces of silver would buy you one once of gold. The price of gold today is $1600 an ounce and I expect that to rise to $5000 an ounce this decade. At $1500 gold that puts silver at about $100 an ounce. With gold at $5000, silver would be around $312 an ounce. That is more than a 1,000 percent gain from today's prices. If silver goes into a mania phase, which is actually pretty possible, we could see silver hit ridiculous prices.
You can buy silver at a local coin shop, online at APmex.com and even on Amazon.
Where do you see the price of silver and gold over the next 5 or so years?