Last week the gold:silver ratio was 1:80.
As expected, precious metals pundits got excited. It was time, they opined, for silver to catch up in a short, sharp burst. That had happened before when the ratio had become heavily weighted in gold’s favour.
After all, we have been down this road before. In September 2010 this writer thought silver was on a tear, having risen 17% in four weeks and 24% since January that year. We were all encouraged by the fact that this coincided with BNP Paribas entering a forward contract with the former Jabiru Metals for delivery of 680,000oz of the white metal.
It seems that watching the ratio between the two precious metals may...