Silver on Bloomberg
 

There was a guy on Bloomberg just now talking about precious metals. He mentioned the gold deficit and how CB's are now going to be buyers so they won't be filling the deficit anymore. He felt we could see gold $600 within a year. Then he mentioned silver postively, but I was alittle confused. He said copper has been moving a lot and will now be in "backwardation". He said a lot of new copper was going to be mined so there would be lots more biproduct silver. I thought he was going to give bad news, then he said that within 18 months we may see silver jump up a dollar to a dollar and a half an ounce in just a couple days, then continue upward.
What does backwardation mean? And what is his logic?

Re: Silver on Bloomberg
 

"backwardation" is a term used to discribe a market condition where the spot price is higher than the future( contracts out in time) price. The opposite market condtion where the future price is more than the spot price refers to a market in contango. Backwardation occurs in a market where phsyical metal is in short supply. As far as him saying that there will be greater biproduct silver, that wouldn't create a jump up in prices IMO.

Re: Silver on Bloomberg
 

I personally did not listen to that Bloomberg, but in the text, with the greater mine production he alludes to for copper bringing about more silver as byproduct but yet higher prices for silver. Maybe what is meant is that although there may be some more mined silver next year or so, the demand will supercede all of that, which is what I conjecture. Supply and demand. The demand will exceed whatever available silver that comes to market in the intermediate future and beyond, imo., forcing prices ever higher (not without the occassional blips however). The industrial uses will be overshadowed by the monetary need, a virtual dogfight. Keep in mind that as copper corrodes and rusts, silver and gold never do, they have eternal properties, and they come from the veins of the earth, they are earths' lifeblood. And how far away have we strayed from the truth of that usage with the current day fiat FRN farce. Soon we will see how godly, silver and gold, 'the barbarous relics' really are!