With today’s jobs-farce in the U.S. resulting in gold/silver prices being dragged back near recent (insane) lows; once again attention focuses on intense demand for real bullion – and rapidly depleting inventories. With respect to the latter point, a recent reader comment illustrates the need to step back for more of a Big Picture look at this subject.

The issue here is both a “truth” which distinguishes the gold market from the silver market, as well as the mythology which the Corporate Media has (gleefully) cultivated around that truth. Most informed investors in the silver market are fully aware that most of the world’s “stockpile” of silver (i.e. the total amount ever mined) has been completely consumed (via industrial usage); while the vast majority of the total, global stockpile of gold remains intact.

Noted silver authority Ted Butler spelled-out the situation in the silver market in unequivocal terms in a previous interview:

In 1959, there were about 9 billion oz. of silver bullion-equivalent in the world (half of that in the U.S.). With a world population of 3 billion, there was a per-capita amount of 3 ounces for each of the world’s citizens. Today, 50 years later, there is a per capita amount of silver of 0.15 of an ounce remaining (1 billion ounces divided by 6.8 billion). That is not a misprint. The per-capita amount of silver bullion in the world has declined by 95% over the past 50 years. [emphasis mine]

Doing a little more math here, the plunge from 9 billion ounces to 1 billion ounces (as of 2009) works out to nearly a 90% decline in global stockpiles of silver. The situation is totally different with gold, although the numbers provided by the “experts” are somewhat contradictory.

GFMS (quasi-official record-keeper for the gold market, and now tool of the Thompson/Reuters media oligopoly) asserts there has been more than 170,000 tonnes mined in total – with almost all of that gold still floating around in global stockpiles.

The United States Geological Survey (USGS) estimates that less than 160,000 tonnes have been mined in total, and that approximately 15% of that amount has “dissipated” over the 5,000 years in which these metals have circulated in human culture...

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Silver Versus Gold; Stocks Versus Flows