Page 162 - Rich Dad's Increase Your Financial IQ: Get Smarter with Your Money

phones, television sets, and other gadgets. It is estimated that 95 percent of
all silver is already consumed. It is becoming scarcer. Gold is different. It is

estimated that 95 percent of all gold ever found is still around. Instead of
being consumed as silver is, gold is hoarded. In many ways, this makes
silver more valuable than gold.
The second reason is because silver is also a precious metal, a form of

money. As the dollar drops in purchasing power, more people will look for
anything that represents real money or at least holds its value. As I write,
silver is very cheap when compared to gold. It is approximately $13 an
ounce while gold is approximately $600 an ounce. Historically, gold has

been only 14 times the price of silver, which means if silver were $10 an
ounce, gold would be trading at $140 an ounce. At today’s prices gold and
silver are trading at a differential of 50. To me, based on historical trends
and the fact that silver is a consumable metal, it has a greater opportunity to

go up in price.
About a year ago, many stock exchanges made silver exchange-traded
funds (ETFs) available for the investor who did not want to hoard silver
coins and bars or invest in silver mining stock. The silver ETF made it

easier for investors to invest in silver. A silver ETF is like the old U.S.
money, a piece of paper backed by silver, known as a silver certificate. The
difference is an ETF can go up and down with the fluctuations in the world
price of silver. I believe the addition of the silver ETF means the world is

getting ready to start hoarding more and more silver as the purchasing
power of world currencies continues to go down.
That silver is a consumable and precious metal makes it the investment
opportunity of the decade. The reports are that there is less than 300 million

ounces of silver left on earth. This means that the world may run out of it by
the year 2020. Because of this, a few silver bugs feel that silver will become
as expensive as gold in a few years. I do not think it will go that high. Yet,
due to the supply-and-demand trends, I believe silver is a once-in-a-lifetime

opportunity. Today it’s a cheap, low-risk investment anyone in the Western
world can afford. That is why I watch the trends and purchase silver
anytime the silver market drops in price. Of course I could be wrong, so it is
best to do your own research and find your own information before

investing in this trend.