As the world moves towards greater economic uncertainty, many people are looking for ways to protect and grow their wealth. Silver has long been a store of monetary value, and it has the potential to be a powerful hedge against inflation. Silver is frequently disregarded by the market as the second-best shiny metal after gold. However, this "white gold" has more to offer as the world moves toward green technology.
Silver is also a valuable commodity for powering the green revolution, as the technology of the future requires silver in many forms. Silver is the best conductor of both heat and electricity, and it has the highest thermal and electric conductivity. The internal combustion engine of a car needs an average of 30 to 50 grams of silver, and electric vehicles require double that amount. Even a single solar panel uses an average of 20–30 grams of silver. There is silver in batteries, semiconductors, and alloys, and the coming 5G revolution will require even more silver for smart chips, autonomous vehicles, and charging stations.
The Federal Reserve can print money, but silver is a finite resource that is good at protecting wealth. The tangible properties of silver made it difficult for overproduction and direct manipulation of its value, contrary to fiat money. The raising of interest rates over the past months to a high of 4% has seen the US dollar bring uncertainty to the market. The declining value of the US dollar as a result of the rate increase has seen high leverage businesses suffer, especially in technology stocks, as Meta is down 75% at its lowest and Apple is down 23%. Silver can be employed as a hedge against the stock market when it declines, allowing investors to recoup some of the losses in their portfolio, just like other commodities
The demand for silver is growing, but the supply is not keeping pace. The demand for silver has grown by 19% in 2021, but the supply has only grown by 5%. The only country with a significant increase in silver production is Mexico, while other countries' silver supply is either falling or slowing down. The demand for investing in silver may rise as more people become aware of its use in day-to-day technology to reduce carbon emissions and promote green technology.
The weakening of the U.S. dollar is inevitable, and investing in silver can be a powerful way to protect your wealth. Silver has a long history as a store of monetary value, but it is also an important part of the green revolution. With the increasing demand for silver and decreasing supplies, investing in silver can be a smart move for anyone looking to protect and grow their wealth. That said, the long-term outlook for silver looks promising. With industrial demand expected to remain strong and more investors looking to silver as an inflation hedge, the future position of silver looks positive.
