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Message:: [QUOTE="mikem2000, post: 2198091, member: 30574"]I don't think you should look at just the fact that silver has dropped 70% as a green light for buying.  That fact does not make silver cheap. It ONLY shows it was cheaper than before.  We first need to look at the reason how it got to near $50 in the first place. By now I think we can all agree that it was fear. So that fear has been fading for a while and is still fading. So we have to start looking at the pre-fear prices. The problem with that though, if we go back to 2007, (pre-fear) you do not get a good picture since oil was 100+ a barrel and maxed out at around $140. As we know, fuel is a huge component in the production cost of Silver. To get a better idea of where silver should be, I think  we should look at the 2005-2006 time frame. Oil was between $40-$60 a barrel, close to where we are now. In addition we need to consider supply and demand. Is silver demand soaring???? No, in fact it has been near flat for 10 years. Is the supply shrinking???? No, more mines are being opened and more by-product silver should be produced as demand for copper lead, and zinc continues to grow. It really does not seem supply/demand will drive silver higher. So, in my opinion, the 2005-2006 frame it quite valid to look at for a comparison. In those years silver spot was between $7 - $11 /Oz, which would strongly indicate that silver is NOT cheap. We could even see cheaper prices if oil continues to fall.[/QUOTE]