Silver Fundamentals Explained 1 - Office Series 7

Silver Fundamentals Explained 1 - Office Series 7

Price elasticity of demand http://en.wikipedia.org/wiki/Price_elasticity_of_demand
Price elasticity of supply http://en.wikipedia.org/wiki/Price_elasticity_of_supply

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[tradergee1]

How does Gold compare to Silver as far as elastic supply and demand?

[BrotherJohnF]

@tradergee1 Well, gold's primary function is as money, so a very high price could make the central banks look for an alternative. As far as supply goes, there are many gold mines that are able to ramp up production to meet the higher price, but the vast amount of gold held would be little impacted. So gold would be fairly inelastic, but nothing like silver

[tgpdlp1]

I enjoy the office series, keep up the good work and keep stacking

[BrotherJohnF]

@tgpdlp1 TY

[DiggingNorway]

This was strange. If the demand curve is horizontal, meaning no price elasticity, that means that even with big shifts in the supply curve prices would change relatively little compared to supply. However, what we see is great volatility in the market, suggesting otherwise. This analysis fails to differentitate between industrial and investment demand. While there may be little elasticity in industrial demand, the curves for investements might have very different characteristics.

[BrotherJohnF]

@DiggingNorway Investment demand is still a small percentage of the 850 million ounces used every year

[kellerj0]

there's milk in the water cooler!

[acuriousbeast]

A person who works as a financial adviser recently said to me that he felt the rise in the price of silver was due to 'silver bugs' stocking up on silver thus creating a self-fulfilling prophecy and this would probably cause a price collapse before stabilizing again. I haven't accepted that however it could be a possibility.

How much of a factor is that in the current overall rise in the price of silver ?

Is silver used in any commercially significant alloys outside of electronics ?

[onlyafool1611]

All of these series are simply fantastic so easy to understand and so well put you have done a truly remarkable job.

[capgains]

silver was $28 when this was made. now $41

[001MeTaBoLiC100]

A cell phone uses around .28 grams please correct me if I'm wrong thanks

[001MeTaBoLiC100]

I agree an electronic of that magnitude should rise in value quite significantly, however I believe this video is addressing the issue of smaller electronics such as cell phones which only use grams of Silver not ounces. I saw in a different video that China will be a major factor in the rise of Ag due to the demand for consumer electronics and the lifestyle the population will want to be accustomed to.

[tradergee1]

@BrotherJohnF Thanks!

[DiggingNorway]

@TOCEO any 101 microeconomics textbook at undergraduate level will explain this... visit a library :)