Tags: investing in silver, iShares Silver Trust, price of silver, silver prices, silver stocks
Silver prices did not fall as much as some expected following Spain's $126 billion (100 billion euro) Eurozone bailout last Sunday. Many investors planned for a spike in the U.S. dollar following the bailout, hurting silver prices.
With everyone's attention focused on the Greek elections this Sunday, silver prices might be the beneficiary of any more turmoil and bailouts overseas. Money Morning Global Resources Specialist Peter Krauth recently weighed in on the subject of silver prices and the Greek elections.
"If Greece is allowed to leave, that will shock Europe into ensuring all is done to keep the larger faltering economies of Spain and Italy from leaving," said Krauth. "If Greece stays, it will likely do so under renegotiated, somewhat relaxed austerity conditions versus those that were required in its last bailout."
"So it's a case of print if you do, or print if you don't," continued Krauth. "There is really little else central bankers know how to do. While nothing's certain in this world, it's a pretty safe bet that raising rates is not something that's happening anytime soon. And that's why the money printing that's likely to come has one antidote: hard assets like gold, silver, oil, and other commodities."
News that Europe's central bankers will work together to stabilize the markets if needed following the Greek elections left silver up 1% Friday to $28.71.
With Europe hinging on Greece's vote this weekend, now presents a good opportunity to take a position in silver.
ProShares Ultra Silver ETF (NYSE: AGQ) is up 0.36% today to $41.90, well off a peak of $72 it reached in February.
iShares Silver Trust (NYSE: SLV) is up 0.18% in trading today to $27.87. SLV shares are up slightly on the week and were trading as high as $28.20 on Wednesday. If the iShares Silver Trust is something that has caught your eye before you should check out this silver options trading strategy regarding SLV.
Besides Europe, a big factor that will move silver prices is the upcoming FOMC meeting on June 20, followed by a press conference by Federal Reserve Chairman Ben Bernanke. A solid statement from the FOMC meeting announcing new easing instead of its more recent ambivalent statements will get a silver bull market going.
In fact, any optimistic economic news could spur a silver rally.
"A greater amount of confidence in the global economy generally means higher growth and that means more silver demand. If you look out beyond the end of the year, you can still see reasons to be bullish," David Jollie, a Mitsui & Co. Precious Metals Inc. analyst, recently told Bloomberg News.
In a final bit of bullish silver news, Krauth also recently spoke with Ted Butler, who publishes bi-weekly commentary at www.butlerresearch.com with a special focus on the silver market, on the manipulation ongoing in silver prices.
Butler said that while the manipulation is currently helping depress silver prices, that won't be the case for long. Once the manipulators are stopped - which, Butler said, always happens when they're controlling an investment in such a manner - silver will soar higher to where the price would be without a rigged market.
"Therefore, the manipulation is giving silver investors a double-barrelled bonanza," said Butler. "One, a cheap price to buy at than would otherwise be the case and, two, a much higher price to sell at once the manipulation is ended."
This means a huge pay day for silver investors.
Indeed, "the big payday is down the road, so keep your perspective there," said Butler. "The long play is the best play."