The Gold & Silver Price

1. Rising demand: Demand from investors is definitely increasing, so much so that the US Mint sold the same value of silver as it did of gold for the first two months of this year. Coupled with the fact the Chinese now import around 110 million ounces each year - previously they used to export that same amount - clearly this is applying upward pressure on the silver price.

2. The need for silver by technology manufactures: Silver is increasingly used in laptops, ipods, cell phones and solar panels. These are growth industries themselves and over the coming years the demand for silver by manufactures will only increase.

3. Gold-to-silver ratio: Historically silver has traded at an average ratio of 16-to-1, meaning 16 ounces of silver should roughly equal the same value as one ounce of gold. At present the ratio is closer 40-to-1, so either gold is overvalued or silver is undervalued. There are strong arguments for the current gold price remaining buoyant so realistically silver is comparatively cheap. With gold at its current price of around $1500 an ounce, silver should be trading closer $90 an ounce if historical analysis is followed.

4. The printing of money: Central banks around the world and the Federal Reserve in America continue to print money in the hope of spending their way out of the recession. The effect of this devalues paper money, and more importantly, the US dollar. The intrinsic value of commodities stays the same but as the dollar weakens the price of gold and silver will naturally rise. Printing money clearly inflates the value of precious metals and will continue to do so for the foreseeable future. Over the last 100 years and since the FED was established, the US dollar has lost an astounding 95% of its value.

5. Silver the poor man's gold: Silver has always been the poor man's gold since the price of one ounce is within the grasp of the ordinary working man. For this reason it has always been a popular option for the greater majority of the population. Now with the advent of the internet, gold and silver can be easily bought online making them even more accessible to the population. With growing inflation and devaluing paper currencies, more people will look for ways to safeguard their wealth.