By Patrick Heller
Liberty's Outlook

        In their recently released World Silver Survey 2005, the Silver Institute reports that worldwide industrial demand for silver in 2004 declined a meager 2% from 2003 despite the average silver price in 2004 that was 36% higher than the year before!
        In fact, if you exclude the jewelry and silverware market in India - a market that is exceptionally price-sensitive industrial demand for silver in 2004 actually increased from 2003 levels! The decline in silver used for photography was more than offset by increases in other areas.
        The report, prepared for the Silver Institute by GFMS Limited, a highly respected precious metals research and advisory firm, attributed the strong price increase to other factors in addition to strong industrial demand:
        1.) Two areas of declining silver supplies are falling recycling of silver especially because of the decline in silver used for photography (A high percentage of silver used in photography, especially x-rays, is recovered and reused. Hence, a decline in silver used for photography also causes a decline in recycled silver.) and a continuing decline in the amount of silver exported by China. Both trends are expected to continue for at least the next several years.
        2.) Strong investment demand for silver, which the report has continued in 2005.
        The industrial uses for silver keep growing. Here are some recent developments that are almost certain to increase silver consumption in the future:
        North Carolina State University at Raleigh has received a grant to develop high-tech t-shirts. Silver particles containing nanometer-sized transmitters are screen-printed onto these shirts. The transmitters can monitor the wearer's vital signs such as respiration and temperature and send the information to a nearby receiver. Perhaps the most significant problem to solve is finding a battery that is both small enough yet with enough power to operate the transmitter. This "e-textile", if developed, would have significant medical and military applications.
        You may have heard of the developing use of radio frequency identification (RFID) tags as a more efficient way to track inventory than current bar code systems. RFID devices are passive. They have no batteries. Instead, they are energized by radio signals from a nearby transmitter. The tag responds by sending its own information identifying the product. The computer-type chip that is the heart of the system relies on a small silver antenna to receive and send information. Although the amount of silver used per unit is minuscule, annual usage should climb into tens of millions soon, and perhaps into the billions in the not too distant future.
        More than 50,000 people per year in the U.S. die from methicillin-resistant staphylococcus aureus (MRSA), which is a drug-resistant bacteria that is contracted while staying in hospitals and health care facilities. A hospital is now testing a hospital bedside cabinet made of plastic that is impregnated with silver ions. Silver's antibacterial properties are physical, which means that germs cannot mutate to become immune to it. The silver literally destroys the bacterium's cell walls, rendering the germ inert. As MRSA can be passed by setting medical equipment and supplies on infected surfaces, it is expected that this cabinet may save several thousands of lives annually. The silver ions also quickly destroy all other bacteria such as e. coli and salmonella.
        Lumber used in construction that is cut and partially assembled in factories can now be efficiently coated with a silver ion finish that resists mildew and mold. Before now, this finish could only be applied at the job site at a far higher cost.
       Editor's Note: Patrick Heller is the editor of Liberty's Outlook, 300 Frandor Ave., Lansing, MI 48912, 1 year, 12 issues, $79.