Is there a metals bubble?

If you think anything in the commodities marketplace right now is demand based, think again. Speculators have caught on to the idea that they can get 95% plus margin and control their own markets.

Direct answer is yes there is a bubble, and some major players are depending on getting bailed out when it pops. Again. My vote is to let the non manufacturing companies fail. But we still have the too big to let fall mentality going on. I suggested that once, and lived to regret it because everyone and their cousin all of a sudden wanted government largesse.

The definition of a bubble is when the price of something rises faster than the intrinsic demand for it. That's exactly what's happening with precious metals. They are being driven by the expectation that they will continue to rise. Obviously the key question is when that bubble will burst. Nobody knows that. After Bob Shiller made his famous comment about "irrational exuberance" in the stock market, the market continued to rise for almost 4 years. He recognized a bubble, but not when it would burst. I can guarantee you that silver is in a bubble; I can't tell you how much longer that bubble will continue to grow.

As you said, there is constantly increasing demand for silver and other valuable metals, because the people who have some economic overview are starting to trust "money" less and less and are looking for alternative means of protecting their money.. Those commodities will continue to rise in price in future even more, because even if a majority of people don't want to acknowledge it, current economy is not so far from free-fall descent.