Submitted by Adam Hamilton, Zeal:
Back when silver’s last secular bull climaxed, the US median household income was under $18k! Today it is around $50k. Across the nation new houses averaged just $76k while new cars generally ran less than $6k. A candy bar cost a quarter. It is grossly misleading to look at decades-past prices without first converting them into today’s dollars which we all understand. That creates a righteous apples-to-apples comparison.
Today’s secular silver bull, while erratic, is much more consistent than the 1970s one proved. Silver’s gains have been more gradual, the periodic sharp surges as greed waxes excessive haven’t been extreme like the 1974 example. This implies today’s bull has a much larger investor constituency deploying capital more gradually over time.
Thus today’s bull is considerably more robust, it has a stronger foundation than the 1970s one. This supports the thesis that today’s secular silver bull will ultimately prove larger than the last one. The better the foundation, the more investor capital deployed before that crazy popular-speculative-mania phase sets in, the higher silver can potentially rocket when the general public finally comes storming in.
So despite all the silver bearishness out there today spawned by silver’s recent weakness, its secular bull looks far from over. Popular speculative manias cap secular bulls, and though the spring-2011 upleg was strong it was nothing remotely close to mania-caliber. Silver is going to see much higher highs, dwarfing April 2011’s near $50 real, before this secular bull has fully run its course and finally gives up its ghost.