Is Silver Finally Starting to Catch Up with Gold?
Source: Lee Thomas, Seeking Alpha (2/4/08)
...An interesting fact to look at is the ratio of the silver and gold prices. In the past 100 years, this ratio has widely fluctuated. The lowest being 22.93 in 1970 and the highest of 101.63 in 1990 when silver was $4.17 and gold at $423.80. Taking the average of the lowest and highest you get a 55.69 ratio. At today’s silver and gold prices, the ratio is 53.88.
Maybe not, some speculators feel the possibility of the ratio falling to around 25 which would translate to silver being at a price of $36.59 per ounce. This is interesting because the nominal silver price in 1980 was $15.20/oz and if adjusted for inflation in 2007, the price of silver would be around $36.40 per ounce...
There might still be some legs left in silver’s rise depending on who you listen to. Be it the abstract idea of silver/gold ratios, or the balance of supply and demand from actual silver consumption.