Silver investors acquired 27.1% of all silver demanded in 2011, compared to only 10.2% in 2006. In just five short years not only did investment demand grow by nearly 170%, but it also grew so quickly that investors were able to displace the rapid decline in photographic, jewelry, and silverware demand.
Repeat: silver investors have been the primary driver of silver demand, making up so much of the pie that they now displace a decline in photographic, jewelry, and silverware demand over the past five years. Silver investors are the market for silver demand.
In short, investors, not end-users, make up far more of the silver market today. And over the past few years, silver investors have accumulated hundreds of millions of ounces – more than one half year of all production in the finest of purities – which could be quickly and easily dumped upon the market at any given time.
Silver is the ultimate in speculative bubbles. It produces no value, no cash flow, and a single ounce of silver will never turn into two. It is as unproductive as an asset as one can own. Once the masses come to realize that their profits are contingent on new and more silver investment, silver’s meteoric rise will come to an end.
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