Silver is a Commodity and a Monetary Metal
The word ‘pound,’ as in British pound, once meant a pound weight of sterling silver or silver that is nearly pure silver (92.5%).
Like gold, silver is – or was – a monetary metal. So its attraction is clear in these times of massive monetary experiments and currency debasement.
Isaac Newton, one of the greatest scientists of all time, was appointed Master of the Royal Mint and quickly monetised silver and set the ratio at 15.5 early in the 18th century and this held until 1873.
The “major monetary metal throughout history is silver, not gold,” said economist Milton Friedman.
In more than 90 different languages the words silver and money are one and the same: shekel in Hebrew, argent in French, plata in Spanish and many others.
Silver is a precious metal, and like gold, it has an intrinsic value. Silver is widely perceived to be both a commodity and a form of money, and it has been used as a medium of exchange for thousands of years due to its inherent value.
Silver also has number of unique characteristics, such as malleability, thermal and electric conductivity, and a resistance to corrosion, which allow it to be used in many important industrial, telecommunications, medical and energy technologies. This industrial demand underpins stable global silver demand.
A lot of silver is used in small quantities in devices such as mobile phones can be less economical to recycle as opposed to gold. So less silver is recycled, thereby creating the need for more primary mine supply. Overall, silver industrial and investment demand continues to increase significantly while meanwhile supply is falling.
Furthermore, some of silver’s demand comes from its use in jewellery and collectibles.
Like gold, silver is part of the precious metals asset class, and can act as a hedge against inflation and a portfolio diversification technique to mitigate geo-political, monetary and systemic risks. Like gold, silver is a store of value and has retained its purchasing power over long periods of time.
It has been shown in numerous academic studies including by the highly respected portfolio and asset allocation experts, Ibbotson and Associates, in a June 2005 study, ‘Portfolio Diversification with Gold, Silver and Platinum’, how silver, and indeed precious metals, are the only one of the seven asset classes with a negative average correlation to the other asset classes. It is also worth noting that the authors showed that, excluding cash, precious metals are the only asset class with a positive correlation coefficient with inflation, which is further evidence that precious metals act as a hedge not just against macroeconomic and systemic risk but also against the long term threat of inflation.
Making Smart Investments
Global Gold & Silver LTD has a track record for identifying good investment opportunities in the international gold and silver market and monitoring the market for new secure investments. We aim to achieve maximum returns on investments by investing in mines with good prospects and buying and selling at the right time and price.
Global Gold & Silver LTD is registered in England and Wales as a Limited Company: No 9977472 with LEI: 213800QBHT3Z4M71H918