The gold to silver ratio (GSR) remains in consolidation between 43 and 49. Consolidation could very well mean "chop" until its secular trend, circle blue in the chart below, turns lower.
Gold to Silver Ratio (GSR), Monthly Average Price And Secular Trend:
Looks to me like the metals are about to go up with silver going up faster. I think the ratio is headed for around 26 to 1 but I don't know when or how long it will take....maybe until April/May of next year...I am sort of looking for $2600 gold and $100 silver....some where in that neighborhood. It may take until Jan of 2013. These
markets just seem take a lot longer than people think to evolve. Maybe that is a good thing.
Gold to Silver Ratio:
Chart: stockcharts.com
I always follow what Sprott is doing in Canada because I think they are one of the best investment groups on the planet. Well, they are adding to the gold bullion in their gold bullion Fund....AND the other Sprott Funds themselves are buying $130 million of the new issue which totals about $266 million...so they are taking their big cash positions which are in Canadian TBills and turning them into gold bullion very shortly.
That tells me a lot. It will be interesting if they try to add to their physical silver fund, PHYS, in the days/weeks ahead as I know Sprott thinks silver is the leading investment for the next decade.
Denny
