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TOP 10 Q & A'sQ2. I have heard many reports that silver is in shorter supply than gold. Why do you seem to prefer gold over silver? Shouldn’t silver outperform gold?
Silver, like gold, is money because it has all of the attributes of money that gold has, as spelled out in the answer to the question above. It’s durable. It’s divisible. It’s consistent. And it has its own intrinsic value. The only attribute where silver is lacking compared to gold is in the area of convenience and portability. To physically transfer $1,000 worth of wealth in gold you need to carry just a little more than one ounce in your pocket. To carry $1,000 in silver, you would need to carry nearly 75 ounces, or 4.7 pounds, of metal in your pocket.
But there is one more reason why I favor gold over silver, especially in the current deflationary period of time. Even at its current price of around $14, silver derives much of its value from industrial use, while gold’s value is almost entirely derived as a monetary store of value. According to Dr. Larry Parks at www.fame.org, there exists something like 55 years of above gold supply and only 5 to 7 years of above silver supply. Copper and other base metals, which are used entirely for industrial use, have only a few days of aboveground supply. Because silver is more of an industrial metal than gold is, we favor gold as our monetary asset of choice and thus prefer gold to silver, especially during periods of economic contraction such as what the global economy now finds itself in.
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