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When everyone panics during economic uncertainty, silver begins to look like an even better investment. People have been buying silver for thousands and with good reason.
Silver is abundant enough to be used in various industries, but it's still rare enough to be considered a valuable commodity. And, unlike other commodities, silver doesn't require a lot of processing before it can be used. In other words, it's a highly liquid asset.
Silver is an excellent conductor of electricity and heat, making it valuable in the electrical and electronics industries.
With all that in mind, let's talk about why silver is such a good investment during periods of economic uncertainty.
People lose faith in paper currency during economic downturns
Paper currency is indeed fiat money, which means it's not backed by a physical commodity like gold or silver. But that doesn't mean people don't have faith in it.
However, during times of economic uncertainty, that faith can be shaken. And when people lose faith in paper currency, they start looking for assets that will hold their value.
That's where silver comes in. Silver has been used as a currency for centuries and is still considered a valuable commodity.
Moreover, silver is much more abundant than gold, making it a more practical choice for use as currency.
Silver is a good hedge against inflation
When the economy is doing well, prices tend to go up. This is due to inflation when the money supply increases and each currency unit is worth less.
In other words, inflation is when your money doesn't go as far as it used to.
During periods of inflation, people tend to buy assets that will hold their value. And silver is a good choice for this since it's a valuable commodity that's not subject to the same fluctuations as paper currency.
Silver is also a good hedge against deflation
While inflation can be bad for your purchasing power, deflation can be even worse. Deflation is when prices decrease, which can be caused by various factors, such as a decrease in the money supply.
During deflationary periods, people tend to hoard cash since it will be worth more in the future.
However, this can lead to decreased economic activity since people are less likely to spend money when they know it will be worth more in the future.
Silver is a good investment during deflationary periods because it's a valuable commodity that's not subject to the same fluctuations as paper currency.
Are you convinced that silver is a good investment?
If not, you should be! Silver is a valuable commodity not subject to the same fluctuations as paper currency, making it a good investment during economic uncertainty. And Jrotbart and others make it easy to purchase silver online.
Silver isn't going away any time soon, and it's only going to increase in value as time goes on. So it's wise to invest in silver now, while the prices are still relatively low. People are now beginning to understand the value of silver and are investing in it for the long haul.
Ross is known as the Pambansang Blogger ng Pilipinas - An Information and Communication Technology (ICT) Professional by profession and a Social Media Evangelist by heart.
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