by Ryan Jordan, Silver Phoenix 500:

While silver is still holding strong into 2014, its price performance is not nearly as impressive as many have come to expect. Is this a bad thing? To my mind, not really. First off, there is no guarantee historically that silver has to move with the other precious metals, or outperform them. As recently as the period from early 2009 to late 2010, silver was stuck in a fairly tight trading range from 14 to 18 dollars, while gold was going on to new highs. Similar examples can be found in the last secular bull market in the 1970s. Sometimes silver would move with gold, and sometimes not—and only some of the time would silver wildly outperform the yellow metal—even as all precious metals saw higher prices from the late 1960s through 1980.

The second reason why we shouldn’t be too concerned about silver’s recent lethargy relates to the perception of silver as an industrial metal. While it is true that silver’s investment demand has grown impressively over the last decade, it is still the case that over half of silver’s demand comes from industry—and it is also true that silver industrial demand is not yet exploding higher the way many had been expecting during the heady days of 2011.

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