Is it Really Possible to Hit 100 USD for Every Ounce of Silver?

In 2020, silver attracted attention by surpassing US$20 per ounce for the first time in four years and has since maintained levels above this threshold, even reaching a peak of US$29.59. Despite several attempts to breach the high US$20s, such as a recent push past the US$26 mark in November 2023, silver has yet to exceed US$30 per ounce.

Keith Neumeyer has consistently expressed his belief in silver’s potential to soar even higher, possibly reaching triple digits. This sentiment has been reiterated in various interviews over the years, including discussions with Kitco in March 2023 and Wall Street Silver in August 2022. While Neumeyer’s projections have occasionally been bold, like suggesting in 2016 that silver could hit US$1,000 if gold reached US$10,000, his expected timeline for US$100 silver has shifted. Nevertheless, his optimistic outlook on silver’s long-term prospects remains steadfast.

Neumeyer Advocating for $100 Silver

Neumeyer believes in silver’s potential to reach triple digits, drawing parallels to past market cycles and citing factors like increased consumption in emerging technologies. Despite acknowledging delays, he remains optimistic, challenging data suggesting surplus and asserting silver’s scarcity. He anticipates a slower ascent compared to gold, with potential catalysts including changes in the gold/silver ratio or media attention to supply deficits. Neumeyer also highlights efforts to counter market suppression, such as launching a minting facility.

Factors that Significantly Affect the Price of Silver

Various factors influence the price of silver, crucial for predicting its trajectory toward the US$100 mark or divergence from it. These include the strength of the US dollar, geopolitical tensions, Federal Reserve interest rates, and supply-demand dynamics. While silver’s ties to gold are significant, both metals respond similarly to market forces. Federal Reserve policies, geopolitical events, and silver’s traditional safe-haven status affect its valuation. Additionally, its industrial utility in sectors like renewable energy enhances its appeal. Efforts to recognize silver as a critical mineral could further accelerate industry development. Understanding these factors is vital for assessing silver’s potential trajectory.

Historic Price Action – Does it Support 100 USD Silver?

While not all market observers predict silver will reach triple-digit values soon, some, like Neumeyer, believe silver is currently undervalued and primed for significant price increases. Others, such as Peter Krauth of Silver Stock Investor, share this optimism, foreseeing what he calls “the greatest silver bull market of our generation.” Examining silver’s recent history, it peaked just below US$50 in the 1970s and neared that level again in 2011 due to strong investment demand. Despite lingering in the teens during much of the late 2010s, silver has largely remained above US$20 throughout the 2020s, reaching highs near US$28.50 in August 2020 and February 2021, and peaking at US$26.46 in February 2022, with similar highs revisited in May and November 2023.

What Do the Experts Think

While optimism surrounds silver’s future performance, not all experts agree on its potential to reach or surpass US$100, given the current economic landscape. Peter Krauth, discussing various scenarios in a May 2022 interview, entertained the idea of triple-digit silver, citing historical trends and the gold/silver ratio. By late December 2023, he anticipated a silver rally in 2024, possibly nearing US$30 and even surging over US$300 by 2030, as suggested at the Vancouver Resource Investment Conference. David Morgan, previously forecasting a short-term rise to US$50, moderated his expectations by 2023 due to potential market intervention and a looming US recession, although he still sees silver potentially surpassing US$30. Gareth Soloway also anticipates silver breaking the US$30 level in 2024, contingent upon overcoming resistance levels, highlighting the influence of economic conditions and gold’s performance on silver’s trajectory.

Frequently Asked Questions About Silver

How to venture into silver investment?

Investors have various options for entering the silver market, including investing in stocks of silver mining companies or gold-focused companies, trading silver futures, buying physical silver bullion, or purchasing shares of silver-focused ETFs. Private investor Don Hansen has shared strategies for constructing low-risk portfolios comprising gold and silver assets. Warren Buffett’s Berkshire Hathaway acquired 37 percent of the world’s silver supply between 1997 and 2006, purchasing much of it for less than US$5 per ounce, with acquisitions averaging roughly US$8.50 to US$11.50 per ounce when adjusted for inflation.

Is silver better than gold?

Both gold and silver offer unique benefits within diversified investment portfolios. Analysts note silver’s tendency to shine brighter than gold during economic growth. However, silver values may decline during economic instability due to reduced fabrication demand. Silver’s dual nature as both a precious and industrial metal contributes to its price resilience. A report by the CPM Group suggests that silver consistently outperforms gold during gold bull markets, though not always.

Is silver not so valuable these days?

Many experts argue that silver is undervalued compared to gold, highlighted by skewed production and price ratios. Despite gold’s dominance in investment demand, silver has gained attention, notably during the 2021 silver squeeze, attracting new market players. Silver’s intrinsic value as a precious metal and crucial industrial commodity is evident in its applications in technology and batteries, driving increased demand. This dual nature was reflected in record-high silver demand in 2022, with significant increases in physical silver investment and industrial usage compared to the previous year, as reported by the Silver Institute.

What factors contribute to the lower price of silver compared to gold?

The price disparity between silver and gold primarily stems from supply and demand dynamics. Despite silver reserves outweighing gold reserves significantly, the price ratio between the two metals remains disproportionate. In 2022, annual silver production exceeded gold production by a large margin, yet the price ratio stands at approximately 1:82, contrasting with the 1:8.3 production ratio. Silver faces demand from both investment and industrial sectors, but gold’s global investment appeal and substantial demand in jewelry overshadow silver’s market prominence.

Is it possible for Silver to ever hit 1000 USD?

In 2016, Neumeyer speculated that silver could reach US$1,000 per ounce if gold reached US$10,000 per ounce, based on the gold-to-silver production ratio, which was around 1:9 at the time and has since shifted to approximately 1:8.3. However, despite theoretical calculations suggesting silver could be valued near US$240 or US$222 based on current gold prices, the actual gold-to-silver pricing ratio has remained between 1:80 and 1:90 in recent times. Even if pricing mirrored production rates significantly, gold would need to escalate by roughly 500 percent from its current level to reach the US$10,000 mark Neumeyer mentioned in 2016. Consequently, achieving such high silver values seems improbable given the current landscape.