Gold, Silver Nowhere Near Being Finished

All the hoopla by the mainstream financial media about the possibility of gold and silver having entered into a bubble is just that: hoopla. Both aren't anywhere near to historic highs, as measured against the CPI-U, and have plenty of upside left in them both.

Even if you wanted to measure gold by the governments unreliable CPI numbers, when adjusted for inflation, gold would still have to reach $2,330 to attain the record it reached in 1980, giving it 30 percent more room to run.

For silver it's even better, as when measured against the government CPI data, it would need to reach $136, an upside of about 246 percent, depending on when you read this article.

But by most measurements, gold and silver should perform even better than those represented by the data above. For example, when measured by percentage gains from 1971 to the former record high, gold climbed 249 percent and silver 307 percent during that time.

If that was to translate into today's prices, gold would jump to $6,227 an ounce, and silver to $160 an ounce.

As we all know though, past performance doesn't guarantee what will happen in the future, but it is a type of general road map one can follow.

The point is, when measured by historical performance, whichever metrics you use, gold and silver are far from reaching their highs, and even further from entering into bubble status.

That's not to say the correction is over or there won't be volatility on the ongoing upward climb of silver and gold prices. Volatility will always be part of silver and gold because of their connection to movements based on headlines, especially with silver.

But overall, we'll continue to see these two precious metals move up in price, as there's nothing in the macroeconomic situation that has changed which would alter that outlook.