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Gold & Silver Prices… Forever Linked?

The price of gold has been inching up again.  It hit $953 per ounce this past week.  And then just as glibly, it floated back down to $940.  It’s been doing that little “up-down-dance” for the past several months and shows no sign of making major climbs, or declines for that matter, anytime soon.  It just is what it is.

But what about silver prices?  Now here is a metal that many people are bullish about, in spite of itself.  It’s currently opening the week at $14.40 per troy ounce and expected to climb.  In fact some are seeing an opportunity.

Gold, as we have discussed here on this blog numerous times, is extremely tied to stability in the markets and the broader economy.  It is viewed by many investors as a good place to put cash when the markets are falling.  Gold is steady and stable and holds its value, if in fact it doesn’t increase because of the uncertainty.

But silver is often more volatile.  It’s value is of course, a fraction of the value of the same portion in gold.  The metal is also softer, tarnishes easily, and is often made into what we used to call in Southern California “beach jewelry.”  It’s also the favored metal of a lot of individual jewelry artisans in the American Southwest, which give it their own designs, shine and patina that are very popular with a lot of people.  Silver and turquoise jewelry made by Native Americans from the Southwest was particularly popular in the United States during the 1980’s and 1990’s, and to some extent it still is stylish.

And certainly part of the popularity has been the lower price of silver jewelry.  Silver has a history of following gold, but years ago, it was decoupled from the price.  It fell further and faster, widening a gap that some think was undeserved.  And still others believe may be possible to close that gap, even if just a little, once again.

Some investors believe that silver is an excellent metal to invest in.  If you do, you would do well to think in terms of silver as a commodity for investment rather than as an accessory.  Where gold’s value can be enjoyed around one’s neck and then resold as the price and need become expedient, silver is more of an investor’s metal.

And right now, it seems to be an investor’s market.

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