Why Silver Prices Will Continue to Go Up

The Future of Silver and Silver Prices

Why Silver Prices are Going Up

A large number of investors have been focusing primarily on the economy rather than the growing dangers of inflation, and that has been part of the reason silver prices have remained somewhat flat and not surged ahead like many projected for 2009, although there's still a lot of time left for that to happen, and has already started to.

Still, the economy, from the point of view of companies holding tight to their money and not willing to pay high prices for raw materials they need, has made a temporary impact on silver prices.

Why that won't go on for long is just about every product using silver in its process is increasing in demand, or is at least holding steady. The lone exception is in photography, which has been trending toward digital for quite a while.

That has of course happened as we move into 2011, with silver prices having soared, finding support at around the $30 an ounce mark.

An update from 2012: It appears silver continues to find support at about $26.00 an ounce after bouncing around throughout 2011. More quantitative easing will push it up far beyond $30.00 an ounce, as has happened on September 13, 2012, when Ben Bernanke opened the QE floodgates again.

Silver in 2013: Silver in a Weak Economy

Growing Demand for Silver

Even other traditional products which use silver like silverware and jewelry have been holding pretty steady in demand during these hard economic times.

A couple other major factors will drive silver prices in the future, and that will be growing demand from emerging products, and the inability to recover silver in some of those products, losing it forever.

Among those products increasing their use of silver include batteries, solar, eyeglasses, medical, mirrors and paint, among a number of others.

Silver Can't be Recovered in Some New Product Uses

Within some of these products, the minute amount of silver used cannot be gathered and recycled, so that will put even more demand on silver stockpiles, eventually driving prices up as well.

The plateau that silver now lingers at won't last for a long time, and as the economy improves and investors start to realize the dangers of inflation because of the outrageous and irresponsible government bailouts, along with the extraordinary growing industrial demand for the metal, makes silver have a future that will only be only growing for a long time. 

Long Term Outlook for Silver and Silver Prices

As you can see, over the long term, silver looks to be one of the commodities which will be in the highest demand, while some of its uses will make it impossible to recover the metal to recycle.

The long term outlook looks tremendously bullish for silver, and investors should reap a huge reward from this metal which has temporarily been held back from soaring in price because of slowdown in demand, and ability or willingness of companies to pay higher prices for needed raw materials.

But a major underlying factor which will drive up silver prices is in industrial uses. Not just that it is being used and driving demand, but that in some cases it is now being used in a way that it cannot be recovered.

Some of the larger losses of silver in industrial use concerns surging demand in electronics, jet engine bearings (as well as other bearings), batteries, and as a chemical catalyst.

Many Uses of Silver

Silver Demand

Demand in all the above areas for silver are either staying a current levels or increasing. But again, the silver used in them cannot be recycled, which will drive up silver prices going forward.

Even this isn't even the entire story though, as other emerging uses will put pressure on silver stockpiles, and, again, drive up prices. Sectors included here are solar cells, paints, mirrors (because of reflective properties), and medicine, where the extraordinary anti-bacterial properties of the metal can be used in a plethora of situations to reduce infection.

Related to the anti-bacterial use is its extreme value to water purification, where high demand for clean water drives the demand for anti-bacterial agents like silver.

Silver Use in Electricity

Silver is an excellent conductor of electricity, and consequently is used in a wide variety of related applications.

Among these are switch contacts in the home, fuses, television sets, phones of all types, electronic toys, dishwashers, washing machines, computers and microwaves, among numerous others.

The reason silver is so valuable in electronics is because it doesn't corrode. It does tarnish when exposed to the air, but that has no effect upon its performance.

Uses outside the home include a slew of contacts in vehicles, as well as switches used for industrial purposes.

Batteries are another growing area where silver is used, including those using silver oxide or silver zinc for stronger performance at higher temperatures. These batteries are used in things like watches and cameras. Other industries they are in demand for are in the defense and aerospace industries.

Batteries using silver-zinc are also used in electric cars and laptop computers, although not as much as lithium batteries are at this time.

Approximately 20 percent of silver use is employed in electronics of some type, with that percent sure to grow quickly as we move forward with growing demand for products using silver in emerging markets with increasing middle classes.

Endless Quantitative Easing

Now that Ben Bernanke and the Federal Reserve have implemented QE3 on September 13, 2012, it adds fuel to the already significant fire for silver, providing even more impetus for the price of the white metal to continue moving up.

What is important about this round of quantitative easing is it's open ended, meaning until jobs get to where the Federal Reserve wants them, it says it will continue to buy mortgage-backed securities to the tune of $40 billion monthly.

There are also no limits as to how much money they will throw into the U.S. economy over time.

What is sure is the value of the U.S. dollar will fall, inflation will increase, and interest rates will remain low. All of this is great for the price of silver, as well as many other commodities, including gold.

Silver the Best Investment over the next Decade

As you can tell, over the long term, silver looks to be one of the commodities which will be in the highest demand, while some of its uses will make it impossible to recover the metal to recycle.

The long term outlook looks extraordinarily bullish for silver, and investors should reap a huge harvest from this metal which has temporarily been held back from soaring in price because of short term slowdown in demand and ability of companies to pay higher prices.

Some analysts and investors see silver being the investment of the decade, like gold was in the last decade.

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Comments 34 comments

Lady Rogue profile image

Lady Rogue 7 years ago from Cleveland Heights, Ohio

Good to know. Thanks!


Steve 6 years ago

Commodities like silver and gold will always be a smart investment. Good hub.


commodity trader 6 years ago

Great post! I agree that silver is a great investment. IF you click on my name, it takes you to a newsletter that i have been following the last 3 months. Listening to this guys recs has made me about 3k a month! He knows when to get in and out. Happy trading!


jack 6 years ago

what makes silver to go along with gold in terms of price


BxL 6 years ago

Wow. I didn't know about that. Great information! Gold investment is still a better choice in my opinion.

Read more about gold bullion and its profits at http://goldbarbuy.blogspot.com/


bullionman 6 years ago

wow, I may want to invest money in silver, gold is just to expensive


ralph black 6 years ago

you might want to invest in as many siver coins as you can it might be the only thing that will be negotiable on the near future


larry 5 years ago

After watching and learning, I invested into a silver stock (it was quick and easy), but working on changing some other financial situation around, so I can buy silver/gold the correct way.

If you need a good teacher on the subject, go here:

www.goo.gl/LPzBV

(that is a google short url)

learn. understand. take action.

because we all know, history repeats!


scheng1 5 years ago

Good article. I think the global demand for solar powered products also drive up the consumption of silver. After all, silver is a good conductor.


dave Buffet 5 years ago

Silver is used in ac units and ipads

i dont need to say more

300 an oz by the end of year!


Joe 5 years ago

Recommendations on dealers for purchasing Silver Eagle and Maple Leaf coins??


Don 5 years ago

Buy! Buy! Buy!


AllSuretyBonds profile image

AllSuretyBonds 5 years ago

Great Hub. I definitely learned a lot of information from your article. I agree that silver is to be one of the commodities nowadays.


Virginia Beach Wedding Photographer 5 years ago

I never thought silver could go up so high so quickly.


shripad 5 years ago

is this any price buble in comodity like silver which will rob investor just like any thing


shripad 5 years ago

is this any price buble in comodity like silver which will rob investor just like any thing


investor 5 years ago

no silver will go up around 20$ a year best bye now though


jime 5 years ago

im getting on the band wagon buying silver dollars every week


inna 5 years ago

While I do agree silver is a good investment, i think people should know what they are doing before they put all their portfolios into something like gold and silver. WE have experienced many financial bubbles, and this might be be just another one on the horizon. All im saying is be smart.


Chuck Bluestein profile image

Chuck Bluestein 5 years ago from Morristown, AZ, USA

China is telling its 1.3 billion citizens to buy silver. That sounds like great advice for anyone. The need for silver in industry is growing. China used to be a big exporter of silver. It has been importing silver since 2007. Two weeks ago silver was $37 an oz and it just went over $43 an ounce, even though it never closed above $42 an oz.


Nilay Shah 5 years ago

I think silver price will achived all time high 2.00 L per kilo.

BUY....BUY.....BUY...!!!

Socho ge to rahe javoge.....!!!!


silverhead 5 years ago

I have been purchasing silver eagles since they went on sale in the late eighties 20 to 40 at a time. Also I have been purchasing morgans and piece dollars.

The realy nice thing NO TAX on your proffits! The government has no control over this!


Troy McHenry 5 years ago

My guess is silver will go near $100 by year end. The increased energy prices, war and federal deficit, will cause silver to up up up!


Wolfgang Somary 5 years ago

Silver is "poor man's gold", just as sugar is "poor man's silver". All three are insurance policies against a possible meltdown in the purchasing power of paper money. They rise when the trust in paper money falls. But they are not for gambling, since you can always be wrong in your timing.


Gold Silver Tips 4 years ago

Very good post, i was really searching for this topic as i wanted this topic to understand completely and it is also very rare in internet that is why it was very difficult to understand.

Thank you for sharing this information.

Regard

Gold Silver Tips


roz1123 4 years ago

I was happy to hear that more money will be given after the silver is sold during the holidays! I was glad to have heard that because now I could give more gifts during Xmas time.


Sobha VijayaKumar 4 years ago

Hello,

Can you please tell me at what rate I can buy silver and gold and also what rate I can sell on long term?

My email is visobibi@gmail.com.

I really appreciate your hubapage.

THanks

Sobha


john weatherholt 4 years ago

the person that wrote this had a damn hangover or something


silverfox 4 years ago

If your young (under 30) buy silver, it will be over $150 an oz by time you retire. That's not hard to believe or prove


James Cunningham 4 years ago

To meany things pushing this market back up to fifty ..... GREAT TIME FOR SILVER

Any questions call me at newbridgemetals 866 771 8136


Kei 4 years ago

Silver is really a good investment.

Last year this time siver price per $28.27/ounce it is today $35.07/ounce. It is going up more soon in 2-3 months time. See here

http://www.goldmoney.com?gmrefcode=lovesilver


Bran 4 years ago

I buy my silver from APMEX best silver and gold store EVER! they have great stuff god I love them I'm gonna order more now!


jeremy 4 years ago

The price of silver as it is right now is no indication on what it will be...the facts however do lend a hand towards this little sleeper. Consider the fact that 95% of gold has already been discovered and is currently in use and only 5% of gold still has yet to be discovered yet the price is astonishing. Now, look at silver. There is only 5% of silver that has been discovered and is currently in use leaving...yep you guessed it...95% undiscovered. What's that mean for you? Well you saw the price of gold skyrocket as we found and utilized more of it. That's the growth you can expect from silver. And as mentioned above there are more and more new products that are using silver so that's just going to aid in its rise in value. Oh and all that is before you stop and consider the real worth of the dollar...which will eventually drop to its real vale of zero...then what do you have...good old fashioned coin money and your metals. But what do I know...


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