Bubbles are something that too many investors worry about. Rather than relying on headlines and predictions from the so-called experts, it would be best if millions of would-be investors just considered the most basic facts. This is particularly true where silver buying is concerned.
The Deal with Silver Buying
Now, this is not to say that there is absolutely no sense in what some of the financial experts are saying, after all, they are continually pointing to the recent surges in silver buying as a reflection of market troubles – which in fact they were. This sort of silver buying happens whenever there is financial turmoil and is done to help investors offset risky holdings, protect wealth, and prevent further losses.
However, this recent batch of silver buying is not what could be called typical by any stretch of the collective imagination. This is because it was the result of global economic trouble and not regional or specific. Instead of being due to a problem in the EU or the American markets, it was the result of problems all over the world.
This means that the latest surge in silver buying was on a global scale. That is why there is about to be a problem with what is known as “supply and demand”.
Here is what we mean: During the economic upset, a lot of people used gold and silver to shore up their portfolios and ensure that their wealth held its value. This is because gold and silver tend to always hold their value in a way that is superior to any other investment vehicle. So, you put $2k into a precious metal it is likely to be worth that, or more, when things turn around. You cannot say the same of most other investment vehicles.
So, around 2008 there was a sharp rise in precious metal investments and this led to an increase in pricing. There was, at that time, plenty to go around because so many industrial buyers were cutting back. This, however, led industrial metal suppliers to slow or cease their production. This meant that mining and refining came to a halt.
What did this do? It left the world’s coffers of new metals a bit on the slim side. Where silver is concerned, it meant that 98% of the above ground silver was spoken for even as the world’s economies began to stabilize.
We are still in this sort of standing in the current era. Even though the biggest consumers of silver (such as the auto industry, electronics, and medicine) have started to get back up to speed, the pace of mining and processing has not.
This is creating a pretty sticky situation in the near future. With the need for silver for investors who want to offset risk, and the growing demands of industrialists who need silver for manufacturing, it means that something, as they say, has to give.
Since neither group is going to relent, it implies that there will be yet another surge in silver pricing, as well as the other metals, because of the probable gap between the available supplies and the growing demands.
To the investors of the world it means that buying now while prices are low is going to reap many benefits and rewards. Those who consistently buy regular supplies of pure silver will see the value of their portfolios increase with any surge in buying and pricing. It may not be the best for industry, and this can create difficult market and financial conditions, but those smart enough to buy silver right now will be able to weather the storm.