GOLDen opportunity in SILVER ?

read an article in DNA Money by Jeff Neilson from Canada,

Forget gold, buy silver mhane..


The supply/ demand dynamics of the silver market are vastly different from the gold market.

There are two key differences between the gold and silver markets.

First, silver is the world's most-versatile metal. It has been the source of more new patents than for any other metal. It is because of the vast uses for silver in a nearly infinite number of current and future industrial applications that the second, different dynamic exists: most of the world's refined silver has been effectively consumed — and is gone forever.

In many of silver's industrial uses, it is used in trace-amounts. In such tiny quantities, there is no practical/ economic way to recycle this silver. More than 90% of the world's silver stockpiles and inventories are gone, forever.

Yet, the gold/ silver price ratio remains near an historical extreme — in favour of gold.

With the amount of elemental silver in the Earth's crust approximately 17 times the amount of elemental gold, it is no surprise that for 5,000 years the gold-silver price-ratio has averaged 15:1.
Today, that price-ratio has been ranging between 60:1 and 70:1. This ratio would be totally unsustainable even if all of the world's silver were still available for demand, rather than gone forever.
While it is very difficult to come up with estimates of total, available gold versus total available silver, some analysts have attempted to make such estimates. They vary widely, and thus do not have much analytical value — except to observe that the highest ratio of available silver to available gold that is seen is 6:1.


Unlike gold, which must only satisfy investment/ monetary demands, silver is becoming an essential raw material of the 21st century global economy. This can be illustrated by simply listing some of its current and future industrial uses.

Power: Silver has reflective, chemical, and conductive properties which are superior to all other metals. This provides two key uses for silver in the production of solar energy. As the world's most-reflective metal (reflecting 97% of all solar energy),

silver is used to make the world's best mirrors — a vital component of solar energy production. In addition, because silver is such a superb catalyst, it also can improve the efficiency of solar cells, by being blended with these semi-conductor materials to increase the power-output of any such power unit by approximately 12%.

In the US alone, 5 million ounces of silver are used each year in the production of mirrors. However, the vast majority of such production are of conventional mirrors (i.e. what we hang on our walls), since solar power is in its infancy. As this application grows in importance, those consumption numbers can be expected to jump dramatically. Projecting that consumption over the entire globe, and it is easy to see global demand for silver — just for mirrors/ solar energy — amounting to several, hundred million ounces per year.

In the massive, global battery market, the newest generation of batteries uses a silver-oxide compound, replacing the previous generation of lithium-ion batteries. The silver-based batteries are not only much more environmentally friendly than the lithium batteries, but also contain no flammable compounds — which have caused (for example) a number of lap-top computers to spontaneously burst into flame. This is making silver-based batteries the new battery of choice for mobile phones and lap-top computers (along with many other electrical applications). With these markets increasing exponentially on a global basis, silver consumption in batteries is also just in its infancy.

Medicinal/hygienic: As important as silver is becoming as a power source, that usage of silver is destined to be eclipsed by the consumption of silver due to another one of its superior properties: as an anti-bacterial agent. The number of potential applications in this area is nearly-infinite, thus the uses listed below comprise only a small sample of silver's potential in this area. Its anti-bacterial uses can be divided into hygiene-based applications along with genuine medical applications.
In the former category, the first use of silver on a massive, commercial level has been to use silver in clothing. It is used in socks, and other military-issue clothing because its anti-bacterial properties retard the development of bacterial infection — eliminating a hygiene problem which has plagued armies for thousands of years.

However, because it is bacteria which is the source of human odour from perspiration, the use of silver in sportswear has exploded into one of the largest, single applications of silver. The usage already consumes more than 1,200 tonnes of silver per year — used in the manufacturing of 50 million tonnes of polyester sportswear (annually), alone.

Once again, current consumption of silver for this usage is merely beginning.
What is most significant about silver's anti-bacterial properties (compared to every other anti-bacterial substance currently known to science) is that it is biologically impossible for bacteria to ever develop resistance to silver-based compounds.

[The writer is editor of bullionbullscanada.com and can be reached at j.nielson@shaw.com This is a condensed version of an article that appeared on www.bullionbullscanada.com.]