Silver Is Still Cheap For Now / Commodities / Gold & Silver 2020

Silver is still near all-time lows in manyways. One of the most significant measures wherein silver is at an all-timelow, is its price relative to the amount of US dollars (US monetary base) inexistence.

Below, is a long-term chart of the silverprice relative to the US monetary base:

As you can see it is at all-time lows(0.004), but actually even lower, since this chart was done before the massiveamounts of US dollars that were created this year. It is currently at 0.0035.

There are way more US dollars in existencetoday than at any point in history, but yet the silver price is not reflectingthat reality.

Another measure wherein silver is at anall-time low is of course debt, and this I explained here.

The point is that silver is still reallycheap. It can only be expensive if it comes into its own as a monetary asset.No industrial demand or other demand as a commodity (especially given theoutlook of the world economy) will cause silver to be expensive or in a bubble.

Only when debt-levels are atsignificant  lows, can silver be nearhighs.

Only when the Dow has had a real crash couldsilver perhaps be overvalued at some point after.

Only when silver is considered an actualmonetary asset (like the US dollar or gold), and actually part of monetaryreserves world-wide could it possibly be considered fairly valued.

Currently, it is really one of the easiestdecisions to make silver part of one’s investment portfolio.

Below, is a long term chart of silver:

This is another illustration of how thesilver price is currently relatively low.

On the chart, the first phase of the silverbull market was from 1993 to the end of 2001, and the second phase is from 2001to the 2020 and beyond.

It appears that there is a similaritybetween the two phases. I have drawn some lines, and marked some patterns toshow how they could be similar.

The first phase is marked 1 to 3, in black,and the second 1 to 3, in blue. Both of the phases appear to occur within in abroadening channel, from which they both broke down, after point 2.

As long as silver is below the bluebroadening channel it is extremely cheap. Just like it was from about September2000 to November 2003 when it was below the black broadening channel.

So, if you missed out on buying silver in1999 to 2003, then now is your chance.

After breaking down from the channel therewas a consolidation that ended at a new point 1. The first phase managed to getback inside the broadening channel again. If the current pattern follows and dothe same (by getting inside the channel), then we will see some high silverprices, but still not expensive.

Only near the top of the broadening channelwould I consider silver to be relatively expensive.

For more on this, andsimilar analysis you are welcome to subscribe to my premium service. Ihave also recently completed a Silver Fractal Analysis Report as well as a Gold Fractal Analysis Report.

Warm regards,

Hubert

“And it shall come to pass, that whosoevershall call on the name of the Lord shall be saved”

http://hubertmoolman.wordpress.com/

You can email any comments to hubert@hgmandassociates.co.za

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Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

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