Chart of the week: silver is a steal

Silver hasn’t been this cheap relative to gold in a quarter of a century – it now costs more than 85 ounces of silver to buy an ounce of gold.

930_COTW

This is an excellent time to buy silver, says Wirtschaftswoche's Frank Doll. It hasn't been this cheap relative to gold in a quarter of a century. It costs more than 85 ounces of silver to buy an ounce of gold. Whenever the gold-silver ratio (the gold price divided by the silver price) eclipses 80, it tends to herald a rise in the silver price.

Other factors bode well, too. Inflation may be on the way, the US Federal Reserve seems less inclined to knock it on the head, and supplies are set to fall: silver is mined as a byproduct of industrial metals, and with metals prices on the slide, less of it will be produced. Industrial demand is enjoying a long-term upswing it has risen by 130% since 1999 as more uses are being found for the white metal.

Viewpoint

Sapiens

Tim Price, PriceValuePartners

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