TSXV:SLX.P - Post by User
Post by
metalbrainon Jan 28, 2011 8:27am
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Post# 18039314
Just Getting Started!
Just Getting Started!Whenever gold and silver takes a healthy dip, there's no shortage of speak towards their bull run being over. Why should this time be any different? I've even come across articles comparing this time to the end of the gold and silver run during 79-80, NO comparison imo! This time it's gone global to the point where no economy is being left unscathed and as a result the fundamentals keep increasing for continuing higher prices in gold and silver. Of course this trend will continue to be the way until a real solution is put in place and if that should ever happen? Then I see gold loosing it's shine, however silver will break away and continue upwards, for it has too many strong underlying fundamentals to be beaten back down with gold.
The 79-80 spike in silver was sweet but very short and scary, whereas today's silver bull run has a long way to go before it reaches any sort of top imo.
34 year silver price
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Below is the global supply and demand data for silver (source: the Silver Institute). As it stands global silver production is approx 700 million oz's/year, so dipping into the reserves is obviously needed to fill the global demand and at that current rate the silver stockpile will be depleted in approx 5 years, but most likely less since China's appetite is getting bigger by the year. Paper apparently can control the price of silver, however it cannot control it's demand and it's shortage, so basically silver is in a position that gold would envy and it's just a matter of a short time before this has a huge effect on the market.
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| World Silver Supply and Demand
(in millions of ounces) |
| | 2000 | 2001 | 2002 | 2003 | 2004 | 2005 | 2006 | 2007 | 2008 | 2009 |
| Supply |
| Mine Production | 591.0 | 606.2 | 593.9 | 596.6 | 613.0 | 636.8 | 640.9 | 664.4 | 684.7 | 709.6 |
| Net Government Sales | 60.3 | 63.0 | 59.2 | 88.7 | 61.9 | 65.9 | 78.2 | 42.5 | 27.6 | 13.7 |
| Old Silver Scrap | 180.7 | 182.7 | 187.5 | 183.9 | 183.7 | 186.0 | 188.0 | 181.8 | 176.0 | 165.7 |
| Producer Hedging | -- | 18.9 | -- | -- | 9.6 | 27.6 | -- | -- | -- | -- |
| Implied Net Disinvestment | 87.1 | -- | 12.6 | -- | -- | -- | -- | -- | -- | -- |
| Total Supply | 919 | 870 | 853 | 869 | 868 | 916 | 907.2 | 888.7 | 888.3 | 889.0 |
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| Demand |
| Fabrication | | | | | | | | | | |
| Industrial Applications | 374.2 | 335.6 | 340.1 | 350.8 | 367.6 | 407.0 | 427.0 | 456.1 | 443.4 | 352.2 |
| Photography | 218.3 | 213.1 | 204.3 | 192.9 | 178.8 | 160.3 | 142.4 | 124.8 | 104.9 | 82.9 |
| Jewelry | 170.6 | 174.3 | 168.9 | 179.2 | 174.8 | 173.8 | 166.3 | 163.5 | 158.3 | 156.6 |
| Silverware | 96.4 | 106.1 | 83.5 | 83.9 | 67.2 | 67.5 | 61.0 | 58.4 | 56.9 | 59.5 |
| Coins & Medals | 32.1 | 30.5 | 31.6 | 35.7 | 42.4 | 40.0 | 39.8 | 39.7 | 65.2 | 78.7 |
| Total Fabrication | 891.7 | 859.4 | 828.3 | 842.4 | 830.8 | 848.7 | 836.4 | 842.5 | 828.6 | 729.8 |
| Producer De-Hedging | 27.4 | -- | 24.8 | 20.9 | -- | -- | 6.8 | 24.2 | 11.6 | 22.3 |
| Implied Net Investment | -- | 11.4 | -- | 6.0 | 37.4 | 67.6 | 64.0 | 22.0 | 48.2 | 136.9 |
| Total Demand | 919 | 870 | 853 | 869 | 868 | 916 | 907.2 | 888.7 | 888.3 | 889.0 |
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| Silver Price
(London US$/oz) | 4.953 | 4.370 | 4.599 | 4.879 | 6.658 | 7.312 | 11.549 | 13.384 | 14.989 | 14.674 |
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SOURCE: World Silver Survey 2010
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