As I write this article, the ratio stands at just over 80:1. That means it takes just over 80 ounces of silver to buy an ounce of gold.

To put that into perspective, the average in the modern era has been between 40:1 and 50:1.

In simple terms, historically, silver is extremely underpriced compared to gold. At some point, you should expect that gap to close.

In the summer of 2019, the sliver-gold ratio climbed to nearly 93:1 and at the onset of the pandemic, it rocketed to over 100:1. But as the Fed slashed rates and launched its massive quantitative easing program, gold rallied and took silver with it. Silver typically outperforms gold during a gold bull run. This was the case during the pandemic. As gold pushed above $2,000 an ounce, a 39% gain, silver rallied to nearly $30 an ounce, a 147% increase.

Meanwhile, the silver-gold ratio fell from over 100:1 to just over 64:1, close to the high end of the historical norm.

With that spread widening again, we could be setting up for another big rally in silver.

Here's some historical perspective.

Geologists estimate that there are approximately 19 ounces of silver for every ounce of gold in the earth's crust, with a ratio of approximately 11.2 ounces of silver to each ounce of gold that has ever been mined. Interestingly, the silver-gold ratio in ancient Egypt was 1:1.