Silver Facts You Must Know for 2011

There has been a tremendous shift in the importance of silver investing recently. The acknowledgment of silver a real money in the new paradigm now moves from economists and astute investors, to everyday people who see the importance of stacking silver.

We’re not talking about simple common sense items such as $50, $75, or even $100 price targets. It seems almost as if they are inevitable, however the focus on 2011 is what is actually happening in the silver industry and factual evidence that one day the vast majority of silver will be almost unattainable on a local level.

Here are five things that every silver investor should know in 2011.

1. Physical Silver’s Sudden Appreciation

Physical silver as a commodity has been on a bull run for quite some time now, outperforming every other commodity in recent years during it’s bull run. The uses for silver is growing and industrial demand is depleting much of the available sources of physical silver. They’re using more and more of it, and simply not finding much more of it simultaneously. This presents an opportunity similar to real estate in the 70’s.

2. Paper Investors Will Begin Buying Silver

Many of the long-term paper investors know that they should buy silver bullion, but are simply procrastinating. We are nearing a time when those investors will jump in because they realize that investing in paper assets alone is not a good diversification strategy.

3. Miners Will Decrease Their Push Of Metal Into Paper Markets

Silver is actually a byproduct of mining for other metals. Miners are wising up and beginning to keep their silver byproduct as profit while selling off other metals such as zinc. Miners are also starting to see that there is resistance in the output of their product into the paper markets. The only place they may likely sell is in Asia where the demand is now huge. The result is many miners holding silver that grows in value untaxed.

4. Institutional Silver Sellers Will Take Silver Off the Market

Simply put, the decrease of silver on the market from 41 million ounces to 28 million ounces is mostly a result from the cancellation of warrants of sellers who no longer wish to participate in selling their silver. It is not from everyday people buying and taking delivery of the physical metal. This impact on the supply side of silver will only push the price north.

5. Corporations Will Demand Delivery of Physical Silver

There are literally billions of dollars in paper contracts that although guarantee the physical delivery of silver, if for some reason it is not delivered the valuation of those corporations would plummet. These businesses need to secure the silver component of their products. It is likely that they will completely bypass the paper markets and deal directly with the corporations who mine the metal. It is also a possibility that some of these tech giants will decide to simply buy the entire mining company.

Read our related article: When You Invest in Silver You Invest in The World