short term, who knows? this is by przemyslaw radomski:

Silver

Silver’s performance has been far from stellar, disappointing those who included the white metal in their portfolios in hopes of higher rates of return. The good news is that silver tends (general tendency of silver) to underperform gold during the initial phase of a rally, and vastly outperform it during the late stage, more than making up for the initial lagging. In other words, silver’s underperformance to gold is nothing to worry about, as we are still in the early part of the second stage of the bull market. On the contrary - we should expect it. Assuming that the major bottom for the precious metals sector is already in place (during the last months of the previous year) and we are still below the previous high (substantially below it, in case of silver), we may infer that the following rally will be accompanied by a massive silver catch up. How can I be so sure that we will eventually rally, and most likely, soon? Because of the favorable fundamentals that determine the market’s long-term direction.

The silver catch up to gold has been visible several times in the past during this bull market. Please compare the following charts for details.

Clearly, in most cases, the final stage of the massive upswing was characterized by an even bigger rally in silver. Since we are not in the final stages of an upleg, but rather at its beginning, silver’s underperformance may be viewed as normal and should not overly concern you.

However, due to silver’s large (and growing) amount of industrial applications, it is correlated with the general stock market to a much greater extent than gold. Don’t forget that silver is both a precious metal and an inexpensive industrial commodity. While Warren Buffet is right that gold is hoarded and “we pay people to stand around guarding it,“ silver is consumed in industrial applications at a frantic pace. (While all the gold ever mined is basically still around in one form or another, that is not true for silver. It gets consumed. Like gold, silver has a finite supply. There is only so much of it under ground, and we use it up faster than we can replace it.)

While correlation coefficients are based on the average values (they tell you what happens on average), the same silver-stocks link is also visible during particularly violent price swings. By that I mean last year‘s plunge in the general stock market and the corresponding massive drop in the value of silver. Gold declined as well, but silver’s fall was much more painful. The point is that if the values of main stock indices move sharply lower, silver may temporarily follow them. If this were to happen, it will most likely be temporary and should not concern long-term investors who hold silver.

Summing up, silver seems to be a great buy today with the medium- and long-term in mind. However, the short-term situation is somewhat unclear.

http://news.goldseek.com/GoldSeek/1246901464.php