Gold ( Au ) & Silver ( Ag ) have dazzled the world for generations. It not just their sparkle that makes them valueable but many other intrinsic properties that gives them the tag of 'Precious Metals'. With the interest rates hitting ground bottom in the United States and currencies across the planet appreciating against the dollar, the world looks upon these precious metals for respite against an uncertain reserve currency.
In the short run the valuations of gold and silver are quite independent from one another but as we take a few steps back and analyze their relatonship over a longer period of time we would observe that there is definate relationship between the two.
Over the long run gold and silver maintain a 1:16 price ratio just like in the current context. TO explain the phenomena- various countries have started converting their dollar reserves into gold thereby reducing the supply of gold which ultimately lead to a in
crease in the price of gold but as price went up demand for silver also increased but since the supply of silver was more or less constant thus this also resulted in the escalation of silver prices.
This seems like the likely reason for seeing the resurgence of the age old 1:16 ratio.
crease in the price of gold but as price went up demand for silver also increased but since the supply of silver was more or less constant thus this also resulted in the escalation of silver prices. 
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