Thursday, January 19, 2012

Where Has All the Silver Gone?

Global demand for silver is exploding while above ground

supplies have dwindled... with no end in sight.

Perhaps you remember a day when you carried around silver nickels, dimes or quarters. Perhaps it was your father or grandfather who gave you a silver dollar for your birthday.

At one point, in 1900, there was about 7.5 ounces of silver per person available in the world. Today that number has been reduced to 0.1 ounces per person.

Fast forward to the 21st century where silver is used industrially in everything from dentistry and medical needs to batteries and solar cells... from computers, cell phones and satellites to high-tech weaponry and lasers... from water purification to RFID chips... and the list goes on.

All these new industrial and manufacturing applications consume millions of ounces of silver each and every year. And once used, the silver is gone forever.

From 1990 to 2000, nearly a billion ounces of above ground available silver disappeared to consumption... while industrial demand rose to 35% by 2000. Today, that demand is 54% and growing quickly, while the silver production deficit continues to widen.

As of 2010, the massive U.S. silver stockpiles that once totaled six billion ounces are gone! Without the U.S. silver, demand is now 200 million ounces more than mines supply.

Some experts forecast we could deplete above ground silver by the end of the decade... potentially making silver more valuable than gold.

Here’s what The United States Geological Society (USGS) stated... that by 2020 silver will be the first element on the periodic table to go extinct!

Even if the trend takes longer to play out, the demand/supply scenario could quickly drive up shares of Sonora once word of its silver assets reach Wall Street. You don’t want to be left behind when the flight to silver reaches a fever pitch.

Silver Surge Factor #2
The Suppression of Silver Prices

The futures market could implode any day and send the
price of silver soaring to never before seen heights.

The paper silver market (COMEX) trades a billion ounces a day... and yet the world only produces 900 million ounces in a year. Even more shocking is that the amount available for settlement of these futures contracts is something like 1.5 million ounces!

"Somewhere along the line some manufacturer will say,
'I can't get the silver I want' and the jig's up."
~Eric Sprott, Hedge Fund Manager

And while evidence of fraud and manipulation mounts, it continues to be “business as usual.”

For example, during the 2008 silver shortage, the price of silver on the futures market dropped 50% from $20 to $10 an ounce in just a matter of a few months. Yet, while this was occurring, demand shot up significantly and supplies were nowhere to be found.

How could this be? It defies all logic of supply and demand... unless as many believe the price of silver is being deliberately suppressed.

What, then, is silver really worth?
How’s $1,200 an ounce sound!

Given recent economic turbulence and global instability, we could see more and more investors wanting to take possession of their silver at the expiration of their contracts. Meaning... at some point, the COMEX could potentially run out of the very silver they have promised to fulfill.

The existing shortfall of supply and ever-growing pressure on physical stockpiles is likely to drive the price of silver higher. If the historical ratio of 15:1 gold to silver stays true, and gold reaches $5,000 like many experts are predicting, that puts silver at $333 an ounce.

What’s more, there are a number of analysts who say this is conservative... that gold could reach stratospheric highs... and that silver could likewise go as high as $1,200 an ounce!

But even if the price of gold hits just $2,500, and the ratio settles in around 25:1, silver should hit $100 an ounce. As to what this could mean for SURE, Eric Sprott had this to say at the 2011 Silver Summit:

“It’s shocking how undervalued the junior miners are…
the breakout, when it comes, will be very sudden.”

All of which bodes extremely well for Sonora Resources. Sonora's stock rise could mirror its mining partner, First Majestic, which went from $1.81 to a high of $25.38... and made early investors HUGE profits!

Silver Surge Factor #3
Be Prepared for Global Financial Meltdown

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