What should be the true price of silver??
So what should be the true price of Silver today?
I don't know but I do know that the price quoted on the COMEX and LBM are not even close to silver's "Fair Market Value". It makes more sense to me to estimate the true price of Silver in relation to another "Monetary Commodity" such as Gold since gold is currently "perceived" as the best monetary metal.
* Based on my mainstream estimates of total above and below ground Silver (17Boz) and Gold (8Boz) the Silver/Gold Ratio should be 2.1-1. With Gold trading at $1,800/oz Silver should be trading at $857/oz or is 25X UNDERVALUED!
* Based on estimates of total above ground Silver (5Boz) and Gold (5Boz) the Silver/Gold Ratio should be 1-1. With Gold trading at $1,800/oz Silver should be trading at $1,800/oz or is 51X UNDERVALUED!
* Based on estimates of total monetary bullion above ground Silver (1Boz) and Gold (3Boz) the Silver/Gold Ratio should be 1-3. With Gold trading at $1,800/oz Silver should be trading at $5,400/oz or is 154X UNDERVALUED!
Of course all this is predicated on the assumption that gold is fairly valued at $1,800oz today which almost everyone agrees is a joke. Since the USA holds a little over 8,100 tons of gold in reserve (supposedly) it is logical to assume that Gold will back the US dollar when the fiat money system fails (not hard to imagine the failure of the US dollar). With the US M2 money supply currently estimated to be in the $9.6 Trillion dollar range, the price of a redeemable gold backed US dollar would be about $37,000/oz IF the US stopped printing dollars today.
The $37,000/oz Monetary Gold price would put the value of monetary above ground Silver bullion, as analyzed in the last bullet point above, at....
.... $111,000 per oz of SILVER!
Crazy, I know, but it really doesn't end there!
Based on the FACT that Silver is being consumed 120% faster than it is currently being mined/produced and the Gold above ground supplies are growing at 2% per annum the Silver/Gold Ratio Formula should be [(Above Ground Silver)(80%) to (Above Ground Gold)(102%)]. With Gold trading at a massively manipulated low price of $1,600oz, Silver should be approaching INFINITY AND IS INFINITY(X) UNDERVALUED!
Wow....chilling conclusions...have you traded your Gold for Silver yet?