The main economies of the world are awash with staggering debt. The nightly news is filled with the continuing debt crisis that is plaguing Europe. As a result the dollar has gained strength, yet food, energy prices, and unemployment remain too high. Many have turned to the stronger dollar for safe haven. However, as the debt crisis in Europe becomes stable the euro will gain strength, and the dollar will lower. Silver prices will rise. The time to buy silver bullion is now, before the spot price starts trending upward.
Silver is currently at the bargain price of $30 an ounce. This is because the when the dollar became stronger against the euro silver and gold dipped in price. This is a temporary price adjustment. As Europe stabilizes the dollar will come back down to reality. Silver offers similar qualities as a hedge that gold does. However, silver is much less expensive. Many small investors mistakenly think they cannot get into precious metals because they cannot afford gold’s steep spot. These folks can buy silver bullion right now for a fraction of what gold is selling for.
Not only does silver offer similar hedge characteristics as gold, but since it is somewhat more volatile there is the potential for big speculative profits. This is the beauty of silver. It is cost effective, offers a hedge, and there is short-term financial gain potential. Silver is an industrial metal. It is great conductor of electricity, is able to withstand high temperatures, and hospitals use silver to fight infections. Yet, the silver supply cannot keep up with demand, and will help silver increase in price.
As mentioned, at $30 per ounce silver is quite the bargain. Those interested in speculative profits need to buy silver bullion now while the price is still low. Going into to 2012 the price will again start trending back up toward its all time high of $50 per ounce. The investors that ran to the dollar for safe haven since it gained strength will soon be dumping dollars for silver bullion.
On the whole, the dollar has recently gained strength because the euro has declined as a result of the debt crisis in the European Union. However, the debt situation is stabilizing meaning the euro will creep upwards and the dollar will descend. The result will be a higher silver bullion spot price.