Why Silver? Why Now?

One little known fact about silver is that up until now, demand has outstripped supply for fifteen straight years. Annual silver supply deficits have run as high as 200 million ounces in the highest years for industrial demand. There is nothing more bullish for a commodity than such a deficit condition. Due to all of the industrial demand, there is actually less silver available for investment than gold. This one fact alone should alert any intelligent investor into thinking that some silver should be held as part of one's precious metals allocation.

We should also look at silver's relationship to gold. Around the world gold is viewed as hard money not subject to the manipulation and devaluation of paper currencies. When people have tangible evidence that something has gone badly wrong with the economy, they begin to hedge against it. One of the best ways to hedge against the economy and inflation is buy owning hard assets such as precious metals. Even though the current economic recession has led to a decrease in industrial demand for silver, silver prices have followed the upward trend of gold as the wealthy and the sophisticated investors have horded the metal. Even more important is to understand how silver and silver coins perform in bull markets for precious metals. If you notice the gold to silver ratio chart on the right, it currently takes over 60 ounces of silver to purchase 1 ounce of gold. Historically this ratio has been closer to 40 ounces of silver to purchase 1 ounce of gold. If silver returned to its normal ratio relative to gold, it would trade at close to $50 per ounce without a change in gold price. Notice the ratio closed to as little at 14 to 1 in 1979.

Easy to trade
Silver coins are very easy to buy and sell, and in most cases, will incur very low transaction fees. Investors should work with a reliable dealer or brokerage company to get the best market price and investment vehicle for their overall objectives.

Tax Advantages*
Like gold, physical silver can be owned within a qualified retirement plan such as an IRA, meaning that the funds used to purchase the silver can be tax-deferred. Like certain gold coins, certain silver coins may possess tax advantages when planning estates or generational wealth.

*(Tax laws regarding IRAs are complex, and in some cases, ambiguous and open to interpretation. Republic Monetary Exchange cannot offer you tax advice. None of the verbal or written communication should be considered tax advice or acted upon for tax purposes. Before making any IRA investment decision, you should seek advice from your attorney or tax professional.)