Ilan Levy-Mayer | January 7, 2016: It seems to be a popular theme in many movies: people that live in the future do not use paper money as a form of currency. They use many different forms of currency. The characters will trade with one another, and in some movies or television shows, they will even use diamonds as a form of money.
Movies and television shows whose stories were told in the past use gold as a form of currency. Rarely do you see any form of entertainment use silver as a form of currency. Current traders understand the value of silver in today’s marketplace. Why is silver a choice that futures traders should consider when they are investing in today’s market?
Are current silver prices too low?
There has to be a starting point to start investing. One should decide if they are planning to use longer-term strategies or shorter-term strategies. Will one use options? Futures? Or a combination of both?
In our opinion, the reason that silver may be a good investment is the precious metals ratio to gold is trending untraditionally higher. Past trends dictate that silver prices may start trading at a higher rate, bringing the gold to silver ratios closer together.
Future
Silver has many uses in the technological field, and it is putting a strain on the amount of silver that is available. Some of the uses for silver include computers, solar panels, and health care items. There are more technological items created every day, and those items use silver as an important component to make the item work (such as tablets). The amount of silver that is mined globally each year does not seem to be increasing and yet there are more and more items being made every year that require silver. Although the silver that is used in the technologies is very useful, that silver cannot be reused for other uses.
Alternative investment
Investing in the stock market can be somewhat risky. The market fluctuates on a daily basis, Another thing to keep in mind is that governments are changing constantly and with those changes, the value of paper money changes. As the governments change they will do whatever they can to make their economy work, which often includes printing more money, causing people to look for a stable asset to either invest, or use as a form of currency. Certain actions taken by governments around the world may support a rise in silver prices, while others may cause price to go down.
Inflation 
As governments print more money, the value of currencies throughout the world will, thus, decrease. As the value of the currencies fall, the need for a safer investment will likely rise. Some countries are leaning towards backing their currencies with value assets, such as gold bullion. Some have even talked about using silver coins.
Governments also create debt as they go to war. It is an expensive proposition to fight a battle and many different countries build up substantial debts trying to keep their military on the battlefield. There are also many other things that create debt for the government, all of which lowers the value of that country’s currency.
When you watch some form of entertainment, whether it be television, movies, or video games, the type of currency that is used is gold, diamonds, and paper currency. Sometimes the movies will have a barter system, but that is rare. Silver is rarely ever mentioned as a form of currency by the entertainment industry, which is an indication of how silver is viewed by many people. Silver should be researched as a possible alternative. In our opinion, one should do research in regards to what they think the future price of silver will be as well as the time horizon for that investment.
Ilan Levy-Mayer has been a commodities broker for over 16 years, and holds an MBA in Finance and Marketing from Hebrew University in Jerusalem. Ilan is currently the Vice President and a Senior Futures Broker overseeing online future trading platforms and Commodity Futures Trading systems at Cannon Trading Company.
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