Revenge of silver --- after 30 years of supression
If you buy the idea of gold/silver ratio shall be about the ratio of silver/gold on the ground, some says it is about 16.
@ 1500/oz gold will give silver $93.75/oz.
With gold and many other industrial metals continue to make all time high, silver is trading around the peak 31 years ago.
The one aspect of the paper trading system is that you can borrow from things backed by nothing. So as long as the system still still functioning and traded within the bound, it is considered stable. However, for silver, things started to change and the once the feedback loop has gain greater than 1 (backwardation?), the price is going to get out of controlled.
We has seen many times of quick and sharp pullbacks during US trading hours being end of more buying with demands of physical deliveries. The games are been played by banks, hedge funds, retail investors and foreign banks. It looks like US banks are on the side of pushing down the future price, but I'm suspecting China is still printing to peg USD and turn around sell USD for PMs and commodities. The next catalyst for PMs is going to be the falling of US T-bonds and/or runaway inflations.
For silver backwardation talks and $400/$500 targets:
My target of $200 for silver and $3000 gold by 2015 maybe too low ...