Price is always a function of supply and demand; why fill vaults with silver instead of gold? Unless you think that gold is too high (which given the historical ratios, is an impossible case to make if you’re also saying silver is going to go higher).
“Unless you think that gold is too high (which given the historical ratios, is an impossible case to make if you’re also saying silver is going to go higher).”
I don’t understand this line of thinking, it doesn’t make any sense. If silver rose 20% and gold dropped 20%, the spread would be a ratio of (1:21.5, gold vs. silver), far from historical norms. Silver can go up by 30% (of its current value, to $61) and gold can drop 30% (of ITS currents value, $1050), (a ratio of about 1:17) and we still wouldn’t be at the historical ratio of gold to silver (about 1:15). While people can think gold is too high, they can also think silver will go higher, according to historical ratios, and be entirely probable and plausibile, not IMpossible. In fact according to historical ratios, either gold is far too high, or silver far too low, or it could even be argued that both values can adjust. However, according to buying power, gold seems to still be about right (A good suit), but silver is a bit low (A family meal at a restaurant) (*Note there are other rules of thumb used by people). The buying power of silver is still not caught up to what is once was, but it’s slowly moving up (at a slightly faster rate than the other commodities/general goods). Me, I think both gold and silver will rise, but silver at a much faster rate. JMHO.
“why fill vaults with silver instead of gold”
Will you be going to the grocery store with a Krugerrand or
Maple Leaf worth $12,000. to buy bread and ask for change each time? I doubt it. Silver is the money of the masses, and will be the medium of exchange on the street for the entire world.