Silver's Outlook May Be Tarnished

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"Miners are pulling more from the ground, and industrial companies are increasing recycling."

Demand for silver from investors is booming, pushing its price this month to its highest level in 31 years. There's just one problem: The supply of silver is growing too. Miners are pulling more from the ground, and industrial companies are recycling more.

That leaves silver prices at risk for sharp corrections, analysts say. Much depends on whether people stay interested in silver as an investment, rather than as jewelry or for industrial uses. Investors accounted for 17% of total demand last year, compared with 0.4% in 2001, according to the Silver Institute.

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