Silver exchange-traded products (ETP) are typically known as paper silver. When someone buys ETP, he is buying paper silver and NOT physical silver. Some might argue that silver ETPs are backed by physical silver but I would keep this simple. When you buy silver ETP, do you receive physical silver? The answer is NO, that means you are buying paper silver. Simple.
Take a look at the black color bar, the addition to silver ETP (paper silver) is getting less and less since 2009. In fact from year 2010 to 2011, there is a negative growth for paper silver. Clearly, the investors no longer want to put money into paper silver.
Take a look at the orange color bar, investors have tripled their silver bullion purchases since 2007. The investors are buy more and more physical silver and abandoning their paper silver because they sense something wrong with paper silver.
Data showed gold sales for the whole year in 2012 were 525,000 oz. Silver sales were 2,449,000 oz just for the month of October 2012. For the whole year, silver sales were 28,244,000 oz. In other words, silver sales is 54 times higher than gold. The gold silver ratio in earth crust is only 10 times more but investors are buying silver 54 times faster. How long can this sustain? Don’t be surprised that one day when you wake up, there is no more silver left for you to buy.
Silver is cheaper than gold. However it tends to follow the same upward trends. This would make silver an attractive alternative for investors. In fact, silver has even proven itself to outperform gold. Silver is a finite resource with infinite usage. The opportunity in physical silver is enormous. It is one of the most undervalue precious metal known to man.
Investors who understand what is happening already parking their wealth into physical silver, what are you waiting for?
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