Silver Investing Is Great - Price Is Down

For the past two months, silver investing has been quite profitable. The price increase in silver has doubled that of gold during this time frame. The price of both gold and silver pulled back last week. The trigger event was the surprise move by the central bank of China to raise interest rates by twenty-five basis points. The U.S. dollar strengthened, and the price of all commodities, which are denominated in U.S. dollars, fell.

The recent rally in gold began about a month earlier than that of silver. But the price increase of silver was much steeper than that of gold. I believe a few investors see the stronger fundamentals of silver. And the silver market is so small, it doesn't take much investor demand to move it.

If you read the precious metals analysts, and I do, you notice that about half calling for a pullback, and the other hal aref predicting that prices will continue north without much pause. I have no idea which half is right this time. Probably the half that was wrong last time.

By nature, I am a short-term trader in stocks, sometimes called a swing trader. I like to play the two-day to two-week swings in price. If it hasn't happened in two months, I'm out. But I know from (expensive) experience that in this investing climate, I will almost certainly lose money trying to swing trade.

The long term, underlying price driver of precious metals is U.S. monetary inflation. Why U.S. inflation and not the inflation of other countries? Because the U.S. dollar has been the world's safe haven for decades. But the dollar is no longer safe. And the central banks, Wall Street, and the ultra rich know it. Despite short term fluctuations in the dollar, the long term trend is down. China's move to raise rates affected price for only a day. The next two days the dollar was down. Then up the next day... no place for swing trading.

Other industrialized nations want their currency to be low relative to the dollar to stimulate exports and keep their citizens employed. Everybody wants their currency to be low. Currency pundits have called the jockeying of the central banks around the world to keep their country's currency value low "The Race to the Bottom."

Long term, the U.S. will win the currency devaluation battle. U.S. debt is staggering, and forty-two cents of every dollar the U.S. borrows today goes to pay the interest on yesterday's debt. The Fed must continue to print dollars, or the government must raise taxes AND cut spending drastically to have a chance. We all know the latter combination alternative of raising taxes and cutting spending will not happen. Which means the Fed will continue to print dollars, which will be cause additional monetary inflation pressure.

This is bad for investments denominated in U.S. dollars, but good for precious metals investing-and very good for silver investing. China is also helping the silver investor. In the first eight months of 2010, China's export of silver has dropped 60% from 2009. In my opinion, they are hoarding silver for their own industrial use.

Although a swing trader by nature, I am a long term investor in silver. My silver investing strategy is to buy a little every month. That way, my average purchase price is more or less the average price for the year. I am confident that the average price of silver next year will be higher than the average price this year.

Learn how to protect yourself against the current (and impending) economic disater with silver investing. For more information: http:www.esilverinvesting.com

3 Best Silver Investments For 2010!

I like silver more than gold because it is much cheaper than gold and it has the potential to give me much higher returns as compared to gold. The good thing is that both these markets are positively correlated. In certain instances, when gold prices have doubled, silver prices have tripled, quadrupled and in some cases even outperformed gold by a factor of six to one.

Since ancient times, silver has been considered as a form of money and as a store of wealth. With the continuing global economic uncertainty, appeal for silver as a precious metal is rapidly increasing along with gold. Unlike gold that has a few industrial applications, silver has many industrial applications. So, with the global economy out of recession, demand for silver is going to skyrocket.

#1 Silver Investment-Silver ETFs

Right now, silver is selling around $18 per ounce. But experts are predicting it's price to jump as high as $100 per ounce. There is a soaring demand for the Silver Exchange Traded Funds. More and more Sliver ETFs are being launched in US and Australia. The world's largest Silver ETF is the iShares Silver Trust (NYSE:SLV). You don't need to own the white metal physically. You can buy the white metal in the form of a security on some of the world's major stock exchanges.

#2 Silver Investment-Silver Bullions

The simplest and the most direct way is to own the white metal physically. The while metal is usually sold in the form of bars and coins.

#3 Silver Investment-Silver Stocks

This is the least direct of all the investments as companies that mine the white metal also mine other metals that can be affect the stock prices of that company. Plus host of other issues like the management issues can affect the stock prices. But investing in the shares of these silver mining companies can give you a good capital gain.

So whatever form of investment you decide, you should keep this in mind that the last bull market in gold and silver has lasted for about a decade. It started in early 1970s and ended in 1980. Those savvy investors who had invested in these precious metals especially the white metals made a windfall gain. This time, the white metal is again poised to skyrocket. This is the best time to invest in silver. Right now the price of silver is hovering around $18 per ounce but within the next six months, it can go as high as $100 per ounce!

Mr. Ahmad Hassam has done Masters frm Harvard University. Download this 40 page Gold and Silver Investing FREE Report by Robert Prechtor. Watch this 30 minutes weird Stock Trading video!

Silver Investing - The Decoupling of Silver From Gold

A few weeks ago, I wrote in this venue about the alleged manipulation of silver prices by JP Morgan. As a matter of fact, three of my first four articles mentioned, and briefly explained the detrimental effect this manipulation has had on silver investing. On September 9th JP Morgan announced that they will be closing their commodity trading department. The small silver investing community grew hopeful that the manipulation would be phased out.

For two-hundred years, the gold to silver price ratio ranged between 15:1 and 20:1. This made a lot of sense, because geologists tell us that there is about 17 times more silver in the earth's crust as there is gold. But for the last twenty years, since huge short positions have been maintained in the silver market and the price ratio grew as high as 75:1. Given that industrial demand for silver has skyrocketed during this period, but not for gold, one would expect the price ratio to decrease from the two-hundred year average. Even though the price of silver has been manipulated to an artificially low level, the prices of gold and silver have been coupled together in recent years. When the price of gold is up, the price of silver is up, and vice versa. Prices have moved in unison, largely because of changes in the value of the U.S. dollar. In the last three years, the only time the price of gold and silver have not moved in unison is when silver approached $21. The price of silver was manipulated lower-until--this last time around.

The recent surge in gold prices has gotten some press recently. But in August and September, the price of silver rose twice the percentage than that of gold. With respect to gold, you might say silver's beta was 2. On October 14th the price of silver hit still another new 30-year high; a very good sign that manipulation is easing. In the first few days of November, it seemed as though a new 30-year price high is made every couple of days.

In May 2010, the price ratio was 68:1. The gold to silver price ratio is currently 52:1, the lowest in decades. The ratio moved 28% of the way to its long term historical average of 17:1 in only five months. Could this be early signs of decoupling for gold?

But there is more good news for the silver investing community. That news would be that two lawsuits were recently filed concernig silver markets manipulation. If the massive short positions in the silver market are removed, through force, or voluntarily, the huge downward pressure on silver prices will be gone once and for all.

Since August, the silver market seems to be moving freely. And the gold to silver price ratio has dropped significantly. If the manipulation ends abruptly, the ratio could drop even more abruptly. And that would be very good for silver investing. The attention that silver will garner in the investing community if that takes place could be the jolt necessary to forever decouple silver from gold. When the supply/demand facts become common knowledge, that is, that silver has a much greater industrial demand than gold, and is in short supply, there will be tremendous upward pressure on the price of silver. It may take years, but I believe worldwide free market forces will result in silver finding it own place, separate from that of gold.

Learn how to protect yourself against the current (and impending) economic disater with silver investing. For more information: http://www.esilverinvesting.com

Gold and Silver Investment - Why Put Your Money in Them

Considered as assets which are self protective, gold and silver investment provides security and assurance to investors especially with the very unpredictable conditions of the state of economies nowadays. A lot of people these days, especially those who are experts when it comes to their finances, put more of their money into these precious metals than in the stock market. Why? One main reason is that no matter how deep an economy falls down, or how bad the recession in a country is, these metals never go down to a zero value.

It is a fact that people nowadays would always think of the best possible ways to increase their money without losing a part of it in the future. The concept of buying silver and gold is like safekeeping your money in the right volt as it earns interest over a period of time. Gold and silver purchase will never be a dying investment because these precious metals will always be equivalent to the dollar. In any situation that the economy yields to a bad light, gold and silver will never be affected. This is why, these metals are considered life-saving.

Gold as an Investment

Before investing any of your money on these precious metals though, having an understanding of the basics of investing is of extremely high importance. A lot of people think that once they place half of their assets in gold investment, they already have a guaranteed return of very high rates. To be able to secure higher profits, an analysis of the current market is in order.

Long since has gold proven to be a secure means of saving, investing and financial support and since this precious metal is very expensive, the price of these natural resources never go down to nothing. In fact, whenever there are economic difficulties, the rates of these valuables increase as opposed to the economy taking a slight dip when it comes to interest rates and even currency values.

All over the world, the demand for this valuable metal is high, and people who take advantage of this incur greater profits since the demand is higher than the actual supply. And with an increasing demand comes increasing price as well. The demand for the physical ownership of these valuable metals has been known to reach a colossal percentage due to the fact that the world's economy is experiencing so much financial loss.

Investing in Silver

Silver is known as the cheaper brother of gold. These metals are still valuable and expensive, and the price of these precious metals has been reported to increase to higher rates. Not only is it cheaper, but because of the increase in its value to even twice of its original cost, a lot of investors place their finances on this metal and get high profitable returns. This estimable metal is also known for its wide range of different purposes, such as its importance in the medical, household, and technological fields.

Investing financial assets in the different forms of these metals such as bullions, coins and bars have already been proven to provide great and profitable returns to investors. Not only is it considered to be one of the safest methods, it is also one of the easiest forms of investments that yield high profits while offering the least risks.

The world's wealthiest have long since turned to gold and silver investment to expand their already large fortunes. Rather than buying shares in the stock markets that can be very risky, especially during these financially-troubled times, they are building their stocks and buying as much pile of gold as well as silver. Why waste your money and time in investing in stock markets when a better and more secured investment is already in front of you?

Aaron Kutchinsky is a writer, lecturer, and committed financial activist.

In 2010 Aaron created and founded Guardian Gold & Silver as a definitive and groundbreaking alternative to the gold industry norm, a mission-oriented and revolutionary precious metals company with 3 specific goals in mind:

? Do the right thing.
? Lead others to understanding.
? Get as many into the boat as possible.

It is extremely important to understand the current world financial paradigm shift, which is now well underway. Please visit http://www.guardiangoldandsilver.com for more information and insights.