Why silver spike in 1980

Precious metals rose after data showed U. Both records were set in On the silver options front, heavy buying of call options indicated investors continued to bet silver prices would rise further. In platinum group metals, platinum gained 0. Business News Updated. By Frank Tang 5 Min Read.

That's because FOMO is driving a flood of speculative money into gold, piling on top of January-June's record physical investment demand. And while this surge in Comex gold futures contracts and especially silver options betting enables active traders already owning the actual metals to take a quick profit BullionVault users as a group have been net sellers over the last 2 days it's giving gold and silver the kind of acceleration they need to catch the eye of the wider world.

So far however, no Sunday magazines splashing glossy pics of vaults or cargo planes carrying gold Where the and tops both came after a decade-long bull market, summer comes only 12 months after gold turned decisively higher, and barely 2 years after it flirted with the crash lows of a half-decade before.

Maybe, and very possibly in the short term. While the underlying trend looks strong, silver in particular might struggle not to stumble on the other side of this jump Anyone thinking they need leverage on the devil's metal probably needs instead to take a breath, if not a Valium. Oh, and anyone buying silver coins or bars to polish at home needs a long lie-down in a darkened room, too.

Beyond the current jump in speculative trading and profit taking, the case for owning a little physical bullion looks set to grow stronger as approaches. Rising inflation expectations, driven by unprecedented peacetime deficit spending and central-bank stimulus, make rare, uninflatable gold or silver an appealing alternative to cash or credit investments that are certain to return a loss in real terms.

Fears of widespread bankruptcies and debt defaults also contrast with precious metals, because physical bullion cannot go bust or miss a payment it never makes any.

For our own ghoulishness meantime, this surge in gold and silver prices is keeping the world's No. Globally the 6-month count of new first-time BullionVault users more than tripled in the first half of from the average pace of the last 5 years.

Most notably, and with deposit rates at the European Central Bank now 0. Have you missed out so far? For private investors it can feel hard to buy an asset which has already risen so sharply, but bank and bullion analysts are now bullish across the board Warning: Such consensus should make us all nervous. First because when everyone thinks the same thing, there's a risk no one is really thinking at all.

If people buy gold as insurance, then being called 'ghoulish' should be the least of our worries. And if hedge funds and other hot-money traders keep spiking the price of silver as well, we might at least get some excitement to detract from the sadness and anger. Like gold, silver enjoyed record price spikes in late and early What those surges also had, and what silver has lacked over the last decade, is a new and compelling narrative.

A return to some kind of metal-backed currency system was widely discussed as the s' long inflationary crisis peaked. Silver's crucial role in photo-voltaic cells then gained mass coverage in late , led by Beijing's plans to cover China with solar panels as part of its post-financial crisis stimulus.

Here in , governments everywhere are hoping new infrastructure spending could accelerate their national recovery. Leading those plans and again following China's example is 5G technology, where the massive rollout of base stations, additional data storage and new 5G-enabled devices is certain to boost the electrical and electronics sectors' demand for silver. Bottom line? Silver tends to act like gold on steroids, if not crack, and the number of private individuals seeking stability and diversification with precious metals has meantime never been greater.

Gold's timeless use as the ultimate store of value shines out amid 's rolling crises. Today's unprecedented central-bank and government stimulus put a spotlight on silver's stronger industrial use and its potential as a high-octane inflation play. Small cheer, I know, against the things that really matter. But losing money on top of losing loved ones won't help us look after those we still have.

Follow Us. Daily news email Go to 'communications settings' Latest gold news by email. Gold Investor Index 2 November Sentiment hits 2-year low. At these levels several physical market forces combined to act against higher prices.

Additionally, the two major U. On an annual average basis, industrial silver use fell a relatively mild 0. Demand had held up reasonably well during the first three quarters of the year. However, a sharp cut-back in demand in the fourth quarter led to overall annual decreases in silver use. When silver prices rose sharply in , manufacturers began searching for ways to reduce their need to use silver. Demand also quickly declined for jewelry and sterlingware.

Investors began to sell large amounts of silver especially old coins from the s. Other sold large amounts of sterlingware and jewelry for its silver content.

A host of political events, including the continuous U. High inflation, high nominal interest rates, and negative real interest rates further stimulated investor interest in silver and other tangible assets.