When Can We Admit Silver Has Been a Lousy Investment?

Silver will make you rich they said. To the moon they said. But will that day actually ever arrive? Looking at various charts from 10 year to 30 day to try and find the silver investing upside.

People who are new to silver investing get caught up in the hype. Same as Bitcoin, and emotions prevent people from looking at the counterargument against their investments. Newbie investors are pouring all of their discretionary income into silver expecting to get rich when it Moons.

Let's look at the most basic analysis, silver performance over time to see if silver has been a good investment. These are the 6 main charts from Kitco.com, 30 and 60 day, 6 month, 1 year, 5 year and 10 year. Now I know that silver is manipulated, silver has limited oz above ground, silver is a hedge against money printing. But these are the same arguments people gave 20 years ago to invest in silver. It may seem new and compelling to newbies but the same players have been pitching the same info for decades.

Price of silver at 1pm August 9 2021 is $23.27. 30 day silver chart shows 30 days ago silver was at $26.30 oz. If you bought 30 days ago you would have lost $3 an oz. 60 days ago silver was $28.00 if you bought then you would have lost almost $5 an oz. If you bought 6 months ago at $27 you would have lost about $4 an oz. Here is the 10 year silver chart. If you bought an oz of silver 10 years ago in July 2011 you would have paid $44. You would have lost about $21 per oz, that's a $10,000 loss for every monster box you buried in your back yard.

The only times silver made money in these charts was the 5 year windows. If you bought in July 2016 at $20, you would have made about $3 an oz.

Based on these charts, has silver been a good investment? Compared to the alternatives it has not. The argument is always, and this argument has been going on for 30 years, silver is just about to moonshot. There is always a reason as to why silver's breakout is just around the corner. Too few reserves, economic bubbles, recessions, inflation, gold silver ratio, market manipulation, today its the government printing money.

Lets look at a 100 year chart. Aug 1932 you could have bought silver for 28 cents an oz. Surely this shows silver as a great long term store of wealth. But lets adjust for inflation, silver back in 1917 would have cost you about $20 adjusted for inflation. A $3 dollar inflation adjusted gain in more than 100 years. I wont begin to compare what returns you would have seen with other investments.

But maybe silver is really about to jump - lets look at this interesting article in Money Week "Property markets and equity markets in the western world are near or at all time record highs. There is increasing macroeconomic and geopolitical uncertainty in the form of the sharp slowdown in the US housing market, increasing trade friction between the US and one of their prime creditors China (the negative impact of the introduction of US trade tariffs on Chinese paper products and the US' WTO piracy claim may not have been fully realized by and priced into the financial media and the markets) and the continuing geopolitical tensions with Russia, Venezuela and in Iraq, Iran and the wider Middle East. These factors look set to at least curb returns in most property and equity markets. The article suggests silver is the opportunity of a lifetime, all so relevant! The problem is that article was written in 2007. And if you search, you can find archived articles going back decades, some from newspapers and magazines, saying the same thing about silver.

I own silver, I agree a 5-10% allocation in your portfolio in metals makes sense, I am buying silver at $23 an oz, I think its a bargain, and hope and expect silver goes up. But would just like to caution inexperienced investors to consider the other side of the story, especially if you are using money you cant lose. Silver is less volatile than Bitcoin, and you are very unlikely to lose everything, but if it flatlines could some of your money be better allocated elsewhere.
#silverinvesting

https://youtu.be/7q2pI3LV3vw silver behavior in recessions
https://youtu.be/cOkVRDuB7Cg Goldbacks - legal gold currency
https://www.macrotrends.net/1470/historical-silver-prices-100-year-chart

https://moneyweek.com/3074/why-the-silver-price-is-set-to-soar