Daily Gold Update

Source: MarketWatch

San Francisco— Silver's trading at an eye-catching discount to gold these days, and some analysts have been debating whether the white metal is severely undervalued given its many industrial uses and its ability to double as a precious metal. Those are handy characteristics to have, especially in an economic environment where cash and investment options are short. And at about $13 per ounce, silver is cheap — trading more than 70 times less than gold at $900 an ounce. Still, the reference to "cheap" silver has been made before and investors, for the most part, have been staying away from silver because of concern about the fall in industrial demand and the more volatile nature of trading involved with the metal. Those are red flags for the near term, analysts said. For the longer term, it could be a whole different story.

Silver sales are up by 150% year on year, according to Nigel Moffatt, treasurer at The Pert Mint, which is owned by the government of Western Australia. The higher sales are largely due to "world economic issues with more people realizing that most currencies in the world are paper based, with no intrinsic value," he said. "People are looking for more tangible assets and the stock markets aren't looking very attractive so at this stage, they seem to be flocking towards precious metals…. Precious metals clearly have had a strong place as an investment medium for the past 5,000 years and probably no more so than today as people look for ways to preserve their savings," he said. See full story.