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<p>[QUOTE=&quot;fatima, post: 1350118, member: 22143&quot;]I will be glad comment on your excellent questions.&nbsp;&nbsp; </p><p><br /></p><ol> <li><i><span style="color: blue">&quot;Expand the supply of paper money and keep the supply of precious metals almost static and they will rise in price in terms of paper money&quot;</span></i>&nbsp; This is simply a statement of inflation.&nbsp; Print more money and stuff costs more.&nbsp; The trick is how do you protect the wealth that you have.&nbsp;&nbsp; At best by this line if thinking, your wealth stored in gold or silver simply keeps up with inflation.&nbsp;&nbsp; You could buy an inflation protected bond to do the same thing.&nbsp; <br /> <br /> </li> <li><i><span style="color: blue">&quot;silver will continue to track the gold bull market and ‘leverage off of it&quot;</span></i>&nbsp;&nbsp; Except that it doesn&#039;t.&nbsp;&nbsp; In 2011 Silver lost ~9%, Gold gained ~11%.&nbsp; i.e. There was a 20% difference.&nbsp;&nbsp; The reason for this is that people buy Gold, especially outside the USA as a hedge against monetary abuse.&nbsp; Governments and central banks stock up on it as well.&nbsp;&nbsp; Gold is the defacto currency against fiat.&nbsp;&nbsp; Silver&#039;s relationship is only established once it is defined and traded in terms of Gold.&nbsp; This has not existed since 1968/1971 but despite this, people still believe there is some relationship. <br /> <br /> </li> <li><i><span style="color: blue">&quot;QE3 will cause the price of PMs to go up, along with other commodities.&quot;</span></i>See answer #1.&nbsp; It would be correct to say that QE3 will cause &quot;Gold&quot; to rise.&nbsp; Other PMs may or may not follow.&nbsp;&nbsp; Gold consistently rises more when governments buy gold to hedge against their $ holdings.&nbsp; They do not buy silver.&nbsp;&nbsp; We had Qe1 and silver did not rise at all.&nbsp;&nbsp; <br /> <br /> </li> <li><i><span style="color: blue">If inflation dilutes the dollar and it takes more money to buy &quot;stuff&quot; and silver is physical &quot;stuff&#039; why do you feel it would not be expected that it would go up?&quot;</span></i>&nbsp; There is not an automatic link between the two.&nbsp; There was huge inflation in the 70s &amp; early 80s but PM prices ended up falling&nbsp; because interest rates were pushed up to 20%.&nbsp; It&#039;s more complicated than number of dollars printed.&nbsp; People often make the mistake of using this period as a guide for today without realizing this very important difference.&nbsp; The equivalent interest rate today in a futile attempt to save the banksters, has irresponsibility been set to 0%.&nbsp;&nbsp; <br /> <br /> </li> <li><i><span style="color: blue">Do you feel it is the industrial usage that makes it less popular as an inflation hedge for you?</span></i>&nbsp; If you are referring to silver, then understand that physical demand at this time has nothing to do with the price you are paying.&quot;&nbsp; These prices are paper prices set on the futures market which is now becoming unhinged due to corruption, failures to regulate, and no prosecution of those breaking the laws that are supposed to protect it.&nbsp; See MF Global and others if interested.&nbsp;&nbsp; Once this finally falls apart, we will have real price discovery on Silver.&nbsp;&nbsp;</li> </ol><p><br /></p><p>I think that does it. If I left something out, let me know.[/QUOTE]</p><p><br /></p>

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