gold/silver price ratio could flip

The gold to silver ratio is the price of an ounce of gold divided by the price of an ounce of silver.

If the price of gold equals $633.46 per ounce and silver goes for $14.41 per ounce a simple calculation yields a gold/silver ratio of 43.96

Some time, within the last couple of years, Ted Butler wrote: "gold sells for more than 60 times the price of silver". That corresponds to a gold/silver ratio of 60.00.

Around the middle of April 2006 the ratio fluctuated pretty tightly around the 44.00 level plus or minus a couple of dollars.

Throughout most of history, 12 ounces of silver could be had for an ounce of gold... with 12.00 being the historical gold/silver ratio. Then, around 1700 A.D. the ratio bumped up to 16.00 (i.e. 16 oz of silver would trade for 1 oz of gold), and stayed at that level for 160 years. Then, in the latter part of the 1800s...

The Comstock Lode was discovered and silver became very plentiful and the ratio went to around 40 (40 ounces of silver would buy 1 ounce of gold).

But today silver supplies aren't like they were up until a hundred years or so, and silver has an industrial demand which gold does not.

Silver, in fact, is more valuable than gold, it is more useful than gold, and it is in higher demand than gold and...

There is only about one fifth "above ground" silver as there is gold.

The claim that there is 5 times more gold than silver has been made by Theodore Butler... and, if it is correct, then don't be surprised if gold to silver price ratios, begin moving not only closer to 16 (from the current 44 level) but eventually approaches 1 oz of Gold per 1 oz of Silver.

Don't be surprised if the ratio will approach and then equal 1.00. And...

When and if this happens, don't be alarmed to see ratios approaching 5 oz of Gold per 1 oz of Silver (i.e. 0.20).

I call this process the "flipping of the Gold to Silver price ratio". It has never happened, to my knowledge, in the course of history... but then

Silver stocks have never been as low as they are now and they continue to be depleted.

So, while a flip of the ratio has never occurred don't bet that it can't and won't happen and...

When it does occur everyone who owns real silver will be very pleased with their ownership position.

Respectfully,

Gerard LeBlond
President
SellinfoProductsOnline.com