anyone looking medium term for a pure australian silver play then ARD is positioned beautifully i reckon. and check out this snippet about how silver could narrow from 60 : 1 difference to gold to around 15 :1 & thus ensure ARD hits the limelight at some point in 2010 - 11. the interesting point that is being made in the article is that the silver price could re-value 4fold to gold, no matter where the POG may climb to. and our little ARD has the "critical mass" to ensure that it can jump into production in 2011 & make hay while the sun shines :
Crux: Where do you see gold and silver? I think people are especially interested in what silver could do because it could return to the 16:1 ratio. Could you comment on that?
Stansberry: Right now, silver has about a 50:1 or 60:1 ratio with gold. It takes 50 or 60 ounces of silver to equal one ounce of gold.
So if you wanted to own gold right now, you could buy a gold coin... or you could buy 50 or 60 ounces of silver.
When there is a global demand for silver as a currency or for a monetary base – in other words, when banks want to own silver, not just industrial companies and coin collectors – the historic ratio between silver and gold has been 15:1 or 16:1.
This fluctuates slightly based on silver production, demand for gold, etc. But if you look back at the classic gold standard between 1720 and 1914, the ratio between silver and gold is about 15:1.
So in theory, by buying silver today, you can actually buy a lot more gold than if you directly buy gold.
The 60 ounces of silver that you buy today will get you one ounce of gold right now. But down the line, you're only going to have to pay 15 ounces of silver for an ounce of gold. So in three or four or five years, when there is robust global demand for silver as a currency, those 60 ounces of silver you buy today will get you three or four ounces of gold.
Now a lot of people can't get their heads around that, and that's fine. You don't have to buy silver to profit from the collapse of the U.S. dollar standard. The easiest way is simply to buy gold. And your target for gold is that eventually the U.S. and the world will settle on a new gold standard.
ARD Price at posting:
16.0¢ Sentiment: Buy Disclosure: Held
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