Quote Originally Posted by Ellen Z View Post
What does that suggest in terms of possible actions?

1) I find myself thinking that if I have cash now to buy additional PMs, I might choose silver rather than gold.

What other possible moves are there, that I haven't thought of?
If you're talking about buying physical PMs, you must take premiums into account as well as the base price. But at a 90:1 ratio silver looks cheap relative to gold.

A person can purchase silver when the silver:gold ratio is very high (like now), then swap it for gold when the ratio shrinks. Ignoring the cost of premiums, when the ratio is 90:1, a person can buy 90 ounces of silver or 1 ounce of gold for the same amount of money. If they buy the silver, then when the ratio shrinks to 45:1 they can swap those 90 ounces for 2 ounces of gold.

Big swings in the silver:gold ratio don't happen all that frequently, but swapping one metal for the other at the high and low ends of the ratio can be a cost-effective way to increase one's holdings without spending more money beyond the initial outlay.

That said, silver has been languishing for a lonnnnng time, ever since EJ made his terrific "Time to Sell Silver" call in April, 2011. Who knows how much longer it will be before it climbs out of the hole?