John Karow
Precious Metals Advisor
John Karow is an experienced lawyer and Precious Metals Advisor at Scottsdale Bullion & Coin. He holds degrees from Lehigh University, the University of Missouri, Cornell University, and St. John’s University School of Law. John is a knowledgeable authority in precious metals, dedicated to helping clients navigate economic cycles and gold and silver investments.
Eric Sepanek
SBC Founder
Eric Sepanek is the founder of Scottsdale Bullion & Coin, established in 2011. With extensive experience in the precious metals industry, he is dedicated to educating Americans on the wealth preservation power of gold and silver.
Once again, gold is the hot topic of the precious metals market as it approaches $3,000/oz following an early-year run. While experts remain bullish on the yellow metal, investors shouldn’t sleep on silver. It might just be setting up for a big breakout.
Silver Skeptic Turned Silver Bull: What’s Changed in the Market?
Many people struggle to break into the silver market successfully. Although the shiny metal boasts inherent value like gold, the factors influencing silver prices make its price action slightly more unpredictable.
First and foremost, the silver market is considerably smaller than gold’s, meaning price movement is more volatile, treating investors to harsh upswings and downtrends. Furthermore, silver prices tend to move in response to gold’s price action, further complicating the timing.
However, the biggest challenge—one many investors aren’t even aware of—is market manipulation. Major financial institutions have been caught artificially suppressing silver prices for their gain, often at the expense of retail investors. When it comes to the silver market, timing is everything.
“It's not so much that I am not a fan of silver; it's that I'm not a fan when the price isn’t right to buy.”
Eric Sepanek
SBC Founder
Founders Take
Those who know me know that I have been a bigger gold bug throughout my career than a silver fan, of which I have usually been a skeptic. One of the reasons for my skepticism was that major forces in the banking sector have been illegally manipulating the silver market for decades. However, I see a possible breakout on the horizon for the first time in a long time.
For many years, brokerages would point to the 15-to-1 ratio that gold is “supposed” to be trading in relative to silver. To explain very simply, 15 oz of silver should be the same value as 1 oz of gold. What most of these brokers would not mention is that this number originally came from the Coinage Act of 1792, a government mandate for currency ratios. What they don’t want to tell you is that ever since we abandoned the bimetallic standard, the ratio has rarely been a reliable indicator of where silver should stand relative to gold in a truly open market.
However, while this ratio shouldn’t be the foundation of an investment strategy, it also shouldn’t be ignored, especially when we see a radical divergence like today. With gold rapidly approaching $3,000 per ounce, silver has not yet followed suit, still hovering around $30-$32 per ounce—10 times lower than its historical 15:1 bimetallic ratio when it was the foundation of American currency.
That’s the widest spread I’ve ever seen! As I write this, the ratio stands at 90:1, reinforcing data that shows the past 5 years have seen the largest separation in history. Could silver be approaching a breakout point?
– Eric Sepanek, Founder Scottsdale Bullion & Coin
The 15:1 Ratio & What It Means for Investors
Instead of getting bogged down in the macroeconomic complexities and the deception behind the scenes, many brokerage houses employ the 15:1 ratio as a shortcut for knowing when to invest in silver. However, most don’t understand the origin of this heuristic. Instead of developing from a free-market equilibrium, this ratio originates from historic monetary standards.
The Coinage Act of 1792 officially set the gold-to-silver ratio, or the number of ounces of silver needed to buy one ounce of gold, at 15:1. This fixed proportion was designed to sustain a balanced, precious metals monetary standard when both gold and silver backed the US dollar. Since the abandonment of the gold standard in 1971, the gold-to-silver ratio has free-floated between 60:1 and 90:1.
Today, the further the gold-to-silver ratio deviates from the original 15:1, the more undervalued silver is considered relative to gold. The consensus among silver bugs is that anything above 80:1 is a buying opportunity, but again, that number is arbitrary. As with all investment metrics, this should be another tool in the arsenal rather than a one-figure decision point.
“This isn’t something you should base your entire investment strategy on, but it’s also not something to ignore. Today, we are seeing one of the largest spreads ever!”
Eric Sepanek
SBC Founder
The Gap Between Gold & Silver Grows
As gold clears $2,900 and silver remains stuck around $31 an ounce, the spread between the precious metals is growing, leading many investors eager to increase their exposure. Currently, the ratio stands at 91:1, and gold’s momentum suggests the gap might grow even wider. This could present an opportunity for investors who know where to look.
Notably, not all silver products offer the same investment opportunity, even those with similar precious metal contents. That’s because dealer premiums–add-on costs above the spot price–vary greatly between assets. Getting the most bang for your buck requires finding assets with currently low premiums.
Morgan and Peace Silver Dollars: A Bargain Opportunity
For investors seeking an advantage over traditional bullion, Morgan Silver Dollars and Peace Silver Dollars present a compelling opportunity right now. These historic coins are currently available at retail prices below spot, offering a rare chance to acquire silver at a discount.
As of this week, these investor favorites were selling for $30 per coin, significantly lower than their $38 per coin price just 18 months ago. This price drop not only makes them a bargain but also highlights their potential for future appreciation, given current market conditions.
What if we hit 15:1 today?
If the shiny metal could close the gap between gold toward the 15:1 ratio, silver would be trading at $200 an ounce, representing more than a 500% jump from current silver prices. Even a fraction of this growth would represent a significant opportunity for investors. This isn’t hypothetical, as many experts have made bullish silver price forecasts for 2025. The numbers look favorable for silver right now.
“I don’t know exactly when silver’s price will move, but I believe it eventually will, and if you position yourself correctly now, you’ll be in a place to take advantage of it.”
Eric Sepanek
SBC Founder
Silver Breakout Potential
Silver’s price movements are driven by a mix of free market forces, supply and demand, and investor sentiment—making timing critical. Given the current historic gold-to-silver ratio, potential market manipulation, and silver’s relative undervaluation, now is an opportunity worth considering.
If you’re interested in learning more about how silver can help you reach your investment goals, request your FREE COPY now of our insightful investor report, Silver: A Sleeping Giant?
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