Forget $50 Silver… The REAL Inflation Adjusted Silver High Is $500+

Right now, Gold is nearly double its 1980 nominal high of $850…

Silver,  on the other hand,  is still 20% below its 1980 nominal high of $48.70…

We are going to play a fast and furious game of catch up as silver smashes through its previous nominal high.

Watch how quiet the media and all of the silver bashers are this time around.

The silence will be deafening.

We all know that $48.70 in 2011 does not buy you anywhere near what it did in 1980. If we factor that record 1980 price in silver using the governments rigged inflation numbers,  that would mean that the REAL inflation adjusted high of silver is $132.07. This means that we are still 68% below the REAL high in silver.  If we use that same inflation calculator for gold,  we would see that the REAL high for gold,is $2,305. This means we are still 31% below that record. (Notice how that all things being equal, you still have a much better opportunity investing in silver than you do in gold.)

I believe that the real, REAL high is actually much, much higher for many reasons. First, the government is lying to you about about the real rate of inflation. A recent article on CNBS shows how the government is lying to you, even today, about the real rate of inflation. They do this so they can steal from you, plain and simple. Every dollar they print is a direct tax on your wages and savings. They need to keep your expectations low so you go not panic while they are gutting you. The government hides this inflation of the currency through four major tricks that I cover in detail in my article on inflation. Click Here. The four tricks are hedonic adjustments, substitution, weighting and subtraction. This allows the government to post benign inflation of 2.4% when the real rate is over 10%. So if the REAL rate of inflation is 4x higher than the official CPI number of silver and gold, that would put the REAL high of silver at $528 and gold $9,220.

This number is much more realistic because the money supply in the United States has been vastly increased since 1980. Using the broad money component of M2,there is approximately 10 times as much money in the economy. So silver at $48 in 1980 times 10x more dollars in circulation is $487 for silver and $8,500 for gold. With that in mind, we are miles away from hitting any real record in silver or gold.

That is just one factor in the price of silver.

  • When you realize that there is a lot less silver in the world since 1980, $500 silver is too low.
  • When you realize that there are 50% more people in the world since 1980, $500 silver is too low.
  • When you realize that only about 15% of the world’s population participated in the bull run of the 70′s, $500 silver is too low.
  • When you realize that there are a lot more Dollars, Euros, Yen, Yuan and other currencies in the world since 1980, $500 silver is too low.
  • When you realize that there is going to world wide collapse of all fiat currencies and all paper assets like stocks,bonds,and real estate… silver is priceless.

“One of the big US banks texted me today to say that if QE3 actually happens, we could see gold at $5,000 and silver at $1,000. I feel terribly sorry for anybody on fixed incomes tied to a fiat currency because they are not going to be able to buy things with that paper money.” Peter Hambro Chairman of Britain’s biggest pure gold listing Petropavlovsk. (Notice once again that silver should vastly out perform gold

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20 comments to Forget $50 Silver… The REAL Inflation Adjusted Silver High Is $500+

  • silverdoc

    A real good indicator of an item’s present day value can be arrived at by looking at ratios. We have the gold/silver ratio, dow/gold ratio, oil/dow ratio and so on, that give a perspective on whether one is overvalued or undervalued when compared on a historical basis.

    Thanks to BrotherJohnF’s diligence we can take this approach when trying to arrive at silver’s present day value, based on the cost of similar items, when comparing the year 1979 with 2011.

    So here we have 1979 over 2011:

    Federal spending: $504.03 Billion/$3.7 Trillion
    Federal Debt: $829.5 Billion/$14 Trillion
    Cost of a new car: $5,000.00/$25,000.00
    Median household income: $16,401.00/$50,401.00
    Cost of a first class stamp: $0.15/$0.44
    Cost of a gallon of gas: $0.86/$3.56
    Price of silver: $48.00/$40.00

    Based on these numbers, the current value or correct dollar price of silver is $295.00! This represents a seven fold increase from where we are today.

    So when you see projected numbers like Silver Shield’s $137 or $528 per ounce, they are not just some wishful thinking numbers he pulled out his Bernanke. They are very real estimates of true, present day silver value, minus the manipulation and long term suppression gimmicks of the banksters and their federal co-conspirators.

    As Jesse Livermore once said, “it’s hard to be right, and sit tight”, but those that do will make the big money . This certainly applies to all those holding physical silver in today’s volatile world.

    So whether you buy silver because of its supply and demand economics, or relative historical value ratios, or because of current fiat endgame dynamics, or maybe just because of your common sense, gut instinct, intuition……they all will prove to be correct, as all investment paths will lead to a common destination, much, much higher silver prices and sustained fundamental value for years to come.

    Don’t get fleeced by fiat, get physical silver….
    … peace of mind for the present, prosperity for the paradigm.

  • Michaelr

    As long as silver is priced in a fiat currency it is under priced. When all fiat currencies are gone and gold and silver are the only recognized store of value then and only then will they be properly priced.


    if silver is 500 or 1000 dollars, it is partly because money has lost value. Therefore those are not the same 500 or 1000 dollars of today. you will NOT be able to buy 10 times more “things” by selling your silver the day thet it is valued a 10 times more dollars.

    BUT: you will definetly not loose your purchasing power. (and most likely gain 2 or 3 X the purchasing power even as the price is multiplied by 10.

    • Silver Shield

      This is a common argument used against silver.
      ” If silver goes to $1,000 then bread will be at a thousand, so who cares.”
      Silver is the most undervalued asset in the world right now and will go up in magnitudes versus all other assets.
      In this very article I say that it is still below it’s nominal high from 1980 and it’s has so much to go up just to catch up to that rise in price.

      5 to 10 times it has to go up and that is relative to the price of goods right now.

      If we throw in a curenncy collapse and add a monetary demand on top of industrial and investment demand to value of silver becomes explosive.

      There has been a 138 year war against silver and the reversion to the mean is going to be vicious and over shoot to the top.

      Read the Silver Bullet and the Silver Shield on this site and also the 3 Demands of Silver.

      Also get yourself some silver…. Just in case…

  • edit corrector

    Watch how quite the media.

    Most likely this should have be QUIET.

  • schmittschmitt

    yes, after the final financial collapse, gold can go also to 10ooo or more than
    100ooo, silver can go to 5ooo or more than 50ooo Dollars. In terms of Dollars,
    it will be difficult to exprime, better to explain, than you will purchase a noble house for only some ounces of Gold. For 1 oune of gold, someone can live
    one year without work. In switzerland there is the well known Prof. Dr. Hans Bocker, who explains the same.

  • doug

    No thank you…good work,good site.

  • Bob

    Another great article; thank you. Great work, great site.

  • terryfkwit

    However John Liendeenar a senior prof working on the massive cern particle accelerator has written that he envisages the mass production of precious metals to be an economic viability within 20 years the diff between lead and gold is only an electron or two…apparently..

  • fred

    The trick to follow the simple rule that inflation penalizes savers and rewards debtors (holding long term fixed debt)
    Just wait for your physical silver to be 500/ounce turn it into fiat and pay everything off. You might have to have it in another country and then exchange it. Mass production of metals? You know how much one accelerator costs? Try 5 billion dollars- heck, a tune up on that thing is 20 million. Oh that’s gonna be economical. Oh we can also use a nuclear reactor- whoops all the gold is radioactive. How stupid is that….? Always be cheaper to hire third world mining to dig it up.

  • Great Article – Well Done!

  • Second Hand Lion

    Just for fun (because I have meant to but not gotten around to it) on my lunch hour today went to three banks and traded worthless FRNs for Silver.I ask for the tellers Kennedy half in his or her teller tray,. My results, after trading $80 FRNs I got 4- 1964 and 9 1-1965-1969 half dollars for a total of $112 in silver! Now I have to get rid of the worthless $73.50 of post 1970’s halfs…….

    not bad for a hours work on my lunch hour!

  • Shhhhh, don’t tell everybody!! All mine!! all mine!! Wanna sell your Mommy’s silver, sonny? 😛

  • ewkeane

    I tripped over this link while serching google with the following search term
    ” silver in inflation adjusted dollars”, bout third one down, heres the link;
    8 places from the top, good job!

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