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 Replies: 11 / Views: 1,609 |
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Pillar of the Community
Canada
798 Posts |
I would like to discuss the fact that $1000 silver would have no bearing whatsoever on the strength of the USD. That inverse relationship is no longer relevant. $1000 silver would merely mean that iPhones and electronics were a few bucks more expensive.
There simply isn't enough silver to absorb demand. With only 1 billion ounces or so mined annually, a measly $17bn purchase could consume all production.
I really, honestly believe that the oil price, nickel, copper, iron etc prices have a greater bearing on the USD than silver ever will.
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Valued Member
United States
274 Posts |
I accept the premise the value of the dollar is no longer tied to the value of silver. That is long established fact.
I disagree that $1000 silver would only make an iPhone a few dollars more expensive. Silver is traded on an international stage, not an American one. In order for the relationship between silver and the US dollar to change so dramatically it would require all other world currencies to also devalue against silver, or there would be a hyperinflation problem in the US at which time the value of the US dollar would drop significantly against ALL measures of value. At $18/ounce it takes roughly 55.5 ounces of silver to buy a $1000 iPhone. At $1000/ounce this would jump to $55,500.00 to buy the same iPhone.
I don't believe you can isolate one measure of value in a vacuum like this. In order for silver to rise to $1000/oz you would also see all other industrial and precious metals increase in a similar fashion. The only way silver could be isolated in the fashion you speak of is if a new use were found that began exhausting the world supply (e.g., it could suddenly be used as fuel for cars).
Just my 2 cents.
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Pillar of the Community
Canada
5240 Posts |
@JGG, it might be a little off-putting to start by saying: Quote:
I would like to discuss the fact that ... when it is your opinion that you would like to discuss. It is a perfectly legitimate opinion that is worth discussion. I don't have any comments except a question: If silver is US$1000 an ounce, what would you be able to get for $1000, compared to now? Not just cell phones, but things like gas and food and housing? I don't know. |
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Pillar of the Community
 Canada
798 Posts |
Why can't silver be $1000 an ounce without any currency inflation?
Bitcoin went exponential without any currency inflation. So did rhodium. So did palladium. Why can't silver? I just don't see how silver is tied to any currency anymore. It is considered a commodity even though we on here all think of it as a currency.
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Valued Member
United States
274 Posts |
&JGG the reason is scarcity. Bitcoin and rhodium are great examples. There is a fixed amount of Bitcoin available. Once the last bitcoin is mined, there will never be any more. There are definitely many other digital currencies, but there will never be a new supply of Bitcoin. It only makes sense that as more people accept and use Bitcoin, the value will increase compared against the US dollar (and every other fiat currency) which is not fixed at all. The government can print as much US currency as they want.
Rhodium, in comparison to silver, is also very rare. According to a very quick Google search, rhodium is available in the Earth's crust at just .001 parts per million. Silver in comparison is available at .075 PPM. That means 75 oz of silver are mined for every ounce of rhodium. However, 80% of rhodium is mined in South Africa. That means any instability in this single country brings world wide supply of rhodium to a halt. By comparison, silver is plentiful in mines around the globe and not subject to the same geo political risks.
Maybe we will see $1000/oz silver, but if we do, it will not be a fun world to live in.
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Pillar of the Community
Canada
798 Posts |
I think that almost no one owns silver, and you could very likely see $1000 silver with gas still being $4/gallon. Silver will just become another asset that only really rich people can afford.
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Valued Member
United States
274 Posts |
You are welcome to your opinion.
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New Member
United States
45 Posts |
It is highly unlikely that silver would increase in value by that much without all other assets doing something similar. It would be an indication of hyper-inflation. It's like saying that if all hyndai accents become worth $100,000 that it wouldn't affect the value of USD. That is only true in theory. In reality, if all hyndai accents become worth $100,000 it couldn't happen in a vacuum, it would be an effect - not a cause - of hyper-inflation.
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Pillar of the Community
 Canada
5394 Posts |
My personal opinion we will never see 50 dollar silver in the next 20 years ,
Nor a return to normalized interest rates .
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Pillar of the Community
United States
4692 Posts |
You have it backwards. Dollar strength/weakness drives commodity prices, not the other way around. Some spikes in silver prices have been due to short term supply/demand imbalances or market manipulation, not currency driven.
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Pillar of the Community
United States
4333 Posts |
It's been said gold prices are currency driven, silver by mania.
When I listen to LED ZEPPELIN...so do my neighbors...
Roll hunting since '77
Dirt fishing since '72
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Pillar of the Community
Canada
5324 Posts |
Silver almost never will hit a 1000 bucks due to the fact that there are many mines of other minerals that has silver as a byproduct, when a copper mine has some silver they will sell it at what ever market price. Although Palladium has a tremendous rise from the mid 90 around 200 bucks to 2500 ,today, and it's a rare earth metal
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Replies: 11 / Views: 1,609 |
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Posted 01/25/2020 5:47 pm
