We can’t compare gold and silver without first looking at the chart below of above-ground stock of gold versus the visible gold market. Remember also that almost all of this gold above ground is in the purest form and ready at very low cost to come to market. This stock of gold is called reservation demand. Reservation demand is a demand that is expressed by holding onto something that you own. People who hold gold are demanding it by holding it off the market. Gold, unlike many other commodities, is not consumed, and therefore the traditional models and theories of supply and demand simply do not apply. Of all the gold extracted from the relatively small number of mines, only a tiny fraction is ever “consumed” in the true sense (about 9%), with the overwhelming production added to the ever growing stockpiles of governments, corporations and private investors, along with small amounts of recycled scrap. For gold there is always a large stockpile and it never gets any smaller, it is simply the owners of the stockpile who change.