Why Silver Is Undervalued, Incredibly Useful, and Worth Stacking
I'm not saying you should only own silver, but everyone should own some.
Last week, I shared why I think about precious metals like gold and silver as wealth preservation, not investments. This week, I’m zooming in on silver, which I consider one of the most fascinating and misunderstood metals out there. Here’s why I believe it’s something everyone should consider stacking:
1. The Gold-to-Silver Ratio Is Out of Whack
Historically, the Earth yields silver and gold at a roughly 10-to-1 ratio, a relationship that has linked these metals for thousands of years. This ratio has been documented back to Biblical times, where silver and gold traded at similar ratios. Today, gold is trading over $3,300 an ounce while silver hovers around $33 an ounce. That’s a 100-to-1 ratio, which is way off historical norms. For me, that’s a red flag that silver might be seriously undervalued. This ratio also tends to revert over time, which suggests there could be a long-term opportunity here. Watching that ratio helps me decide when to buy more and reminds me to keep my stack growing steadily.
*Pre-1964 US coinage had 90% Silver content and is still known today as Constitutional Silver or Junk Silver.
2. Silver Gets Used Up—Gold Mostly Sits in Vaults
Gold is often locked away in vaults or worn as jewelry, rarely seeing the light of day. But silver? It’s constantly being consumed in products like smartphones, solar panels, medical devices, and batteries. This means a significant amount of silver is lost to industrial use every year, making it scarcer over time. That dynamic creates an interesting supply-and-demand case for silver, especially as green technology ramps up and increases demand even more.
3. Silver Has Real-World Superpowers
Silver is an antibacterial powerhouse and a top-notch conductor of electricity. It’s essential in water purification systems, medical equipment, and solar technology, as well as in automotive parts and even laundry detergent. When you think about it, silver is in almost every modern convenience we rely on daily. Have you ever heard of silverware? People used to eat and drink with actual silver because of its antibacterial properties and because it kills bacteria on contact. That makes it more than just a metal. It’s a critical industrial component that isn’t easy to substitute.
4. Accessible and Stackable
One of the best things about silver is that it’s accessible to nearly everyone. You can start stacking silver with as little as $36 for an ounce. It’s been running up the past few weeks, but if recent history is any indicator it could easily fall back down to the low $30’s in short order. It’s called the “poor man’s gold” for a reason: it’s a low-barrier entry point to precious metals. I personally love Silver Eagles because they’re highly recognizable, harder to counterfeit, and easier to sell if you ever need to. But whether it’s coins, rounds, or bars, there are plenty of ways to start building your stack, whichever fits your budget and goals.
5. It’s Practical and Tangible
In uncertain times, there’s nothing quite like holding a physical asset in your hand. Silver doesn’t rely on passwords or internet access. It’s something you can barter with or even trade locally. I’ve personally bartered silver for things like comic books, without any middlemen required. It’s not just an investment on paper; it’s a real, tangible asset that can be used in ways digital assets simply can’t.
Final Thought
Silver is the steady turtle in the race. It might not make headlines like crypto, but it’s reliable, consistent, and has stood the test of time. I'm not saying you should only own silver, but everyone should own some.
If you have questions about stacking or want to share your own experiences, reach out anytime. I don't pretend to be an expert, just someone who’s enjoyed collecting precious metals for most of my life. If you're interested in me talking more about precious metals or silver, let me know. Otherwise, I’ll likely leave the topic for now, there's no shortage of other advice and hacks to share. That's it for this week's Five4Friday. Have a wonderful weekend, everyone.
Good thoughts, and I concur that precious metals should be part of an investment portfolio, although I prefer to own the actual metals, not “paper” silver in a traditional portfolio, so I keep those separate. As you said in your previous post, precious metals shouldn’t be seen as an investment anyway.
FWIW, the Coinage Act of 1792 set the silver-to-gold ratio for the U.S. at 15:1, which is slightly higher than the historical ratio you cite. These days, traders usually consider a ratio of 80:1 or higher an indicator that silver is undervalued, so current ratios definitely align with that rule of thumb.