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<p>[QUOTE=&quot;medoraman, post: 1269159, member: 26302&quot;]I was actually rereading Historia Numorum last night and it was talking about gold/silver ratios. In Babylon it was 13.3/1, and this drove the systems in the eastern med for a few hundred years. Then large gold mines in Thrace were found and the ratio went down to 10/1 for most early Greek issues. The Persians were 13.3/1 until their capture of Lydia when exposure to the Greeks ratio had them lower theirs. </p><p><br /></p><p>My point of this? The ratio always adjusts based upon geography and demand. Since its now a world market geography no longer matters, so its simply demand. All of the historical gold/silver ratios you read about are slanted in that they basically are European and middle eastern standards anyway. With demand now worldwide, and both metals having very different uses and sources of demand, I really do not see how this ratio is meaningful in any way.</p><p><br /></p><p>Is it interesting to read about? Yeah. Is it interesting to know that the historical ratio is a pretty close approximation to the levels found in the earth? Absolutely. Will analyzing this ratio do anything to help me know what to buy or sell? Heck no. EVEN IF you believed this ratio will predict the future, which would it predict? I know those who push this stuff will always tell you one or the other HAS to go up, but if its just a ratio its just as easy for the &quot;overvalued&quot; PM to go down and get the ratio in line, right? So, EVEN IF the ratio today was believed, and it said that silver was relatively undervalued, what does that tell you? Buy silver or sell gold? If you do not know which of those actions would occur, the ratio would STILL be useless for investing.</p><p><br /></p><p>Chris</p><p><br /></p><p>Edit: Btw Inflexion I hope you are not taking these responses as picking on you in any way. I am responding generally, since many people here would read about the ratio. I know you are a silver bug, which is great, and to me it is extremely interesting how gold, by its price, is so much more valued apparently versus its true rarity. I am just cautioning everyone that this knowledge, even though true, I do not believe helps determine which metal to invest in. Even if a person believes this ratio has to change, always remember the old truism, &quot;markets can remain irrational longer than investors can remain liquid&quot;. I simply believe that excessive demand from economically rising countires/cultures is unbalancing things. I have no idea whether this imbalance will ever be changed, so therefor simply hold both PM&#039;s.[/QUOTE]</p><p><br /></p>

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