“Most precious metals analysts would broadly expect gold and silver to end up in roughly the same place over the long term, but silver would get there with more sleepless nights,” Morris writes. “So why bother? The answer is that when silver is undervalued, as it currently is, there is the opportunity for a catch-up rally. Not only that but under the right conditions, it will overshoot.”
He said that since the late 1990s, gold has played “an increasingly important role in the informal monetary system” after leading the formal money system for centuries prior. He notes that even with silver’s recent strength, “it isn’t a bubble by any means” because investors have been selling silver for the last two years and their holdings are not much higher than in 2011 when the price last hit $50 an ounce.
He also notes the February 2021 surge in silver ETFs, but says “the money soon left, and once again, the gold and silver aggregate ETF holdings are back in line.”
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