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Gold/Mining/Energy : Silver prices -- Ignore unavailable to you. Want to Upgrade?

To: Ming who wrote (850)	3/8/1998 9:36:00 PM
From: philv	Respond to of 8010

Ming: My view only: The POS is not high in historical terms and especially when inflation is taken into consideration. For someone to have bought silver in India, which is most likely in the form of jewellery, it is hardly worthwhile to take that jewellery back and have it re-cast and refined and returned to world markets. There is a substantial cost involved. Yes, that was done in the heady HUNT days, some 15 years ago when it peaked at more than 5 times todays price. Silver is more volatile historically than gold. kitcomm.com If you look at the last column, you can see the volatility from year to year measured in percent. So, for me, I am content to take a longer view. The recent drop may have more to do with the completion of Buffett's purchase than any selling by Indians. Phil

To: Ming who wrote (850)	3/9/1998 12:07:00 AM
From: paul ross	Read Replies (1) \| Respond to of 8010

Ming- The CPM Group addresses just this issue in a recent report of their's: "Secondary supply of silver could rise to meet some of the shortfall, as higher levels of fabrication demand continue to feed a steady supply of metal to scrap recycling plants. Most of this recycled silver comes from old photographic materials, which can be recycled at a relatively low cost. The supply of silver from this source is thus not so much linked to the price of silver, but rather to the level of photographic use of silver. Indeed, the degree to which silver supplies will not quickly rise in response to price increases is one of several factors pointing to higher silver prices. Fabrication demand similarly has a low price elasticity: It will take sharply higher prices before most fabricators reduce their unit silver requirements or seek substitutes. Even in jewelry and silverware, the most price sensitive demand sectors, it will take prices over $8 to $10 before demand is significantly dampened. One erroneous assumption about silver is that demand for silver items in India will dry up at prices above $5. This is not the case. Similarly, concerns that Indian buyers will re-sell their silver over $5 are misplaced, overlooking the 23% premium Indians pay for bullion over the international market price, due to various import fees, taxes, and commissions, which they do not recoup on the sale of their silver. This premium significantly raises the target prices these silverware holders have before they will sell any of their metal." CPM Group: cpmgroup.com PR