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A Few Reasons to Consider Buying Silver

Tuesday, May 20th

The recent major selloffs in silver have given investors an excellent chance to accumulate a long-term position in physical holdings and silver companies. As the price has come down, I have been recommending for some time to dollar cost average and/or pyramid down into silver and silver equities. So what is the path to a surge in silver prices? My primary thesis is that the endless easy money policies from central banks around the globe have created a long-term tailwind for the various precious metals.

Despite the short-term pressure on the metals, the Federal Reserve’s continued accommodative and dovish policies should create a weaker dollar in the long run, inflation, and, in turn, bolster the prices of gold and silver. This thesis rests on silver being treated as a precious metal. Precious metals hold value and increase their buying power when inflation ticks up. While this has yet to occur in the U.S., it will be a likely result of a diluted money supply. While gold is the ultimate hedge against inflation, other precious metals — such as silver, platinum, and palladium — all tend to move higher when inflation creeps up.

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