Talking about the price of silver is truly exciting. Most people would think it’s a boring, very dry topic. It’s not and in fact the silver price is way more exciting than the gold price. Take it from there: while gold is mostly an investment commodity with importance for the jewelry industry and some importance to other industries, silver is way more diverse when it comes to explain or understand price action. Yes, silver is also an investment metal with importance but because the percentage of silver used to mint coins and bars is way smaller, the investment demand isn’t impacting price action so significantly.
Most people even don’t realize the importance of silver for so many industries. Review the list below to understand the tremendous importance of silver. There is a direct connection between the silver price and the demand of various industries
The importance of silver for medical products of any kind is widely not known; like the fact that silver got the ability to kill bacteria. Even back in the day, the Old Timers placed silver dollar coins into their milk bottles to prevent them from getting a cold or the flu. By adding silver to water, silver ions are getting released. Those ions prevent the metabolism and growth of germs.
Did you know that the Old Timers used silver dollar coins to prevent illness by pacing coins in their water bottle?
Already 3000 years ago, the Phoenicians knew about the “medical” effects of silver. They found out that water and other liquids would stay fresh longer by storing them in a container with a silver coating.
If supply is greater than demand, the silver price may decline or stay stable. If the demand is greater than the supply, the silver price is very likely to increase. According to the Silver Institute in Washington, silver is a system-relevant commodity that cannot be replaced by another metal. Even a system-relevant commodity is not immune against a significant price-decline as 2020 proofed. Right around the beginning of the coronavirus crisis, the silver price plunged down to approx. $13 per ounce. You would think that this is an irrigational selloff but if you see the bigger picture, the significant price drop makes sense. As already explained, silver is first and foremost an industry metal and with worldwide lockdowns effecting pretty much every industries, the silver price was ready to tank. Nobody knew how long and how hard the world would shut down. Thus, the silver price went down.