GOLD has topped !
- Thread starter EmAy
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A good question, JaiSreeram.
We can start with this that Gold markets have been ahead of Silver for a very long time. Gold has always been a preferred ornament from times immemorial and been in great demand. The ancient royals wore them. In present times, they are used as a security for loan lending even among nations.
Considering Silver, earlier in the olden days, it was more of a metal than an ornament. They used it in the development of photos. However, as of now, its demand has fallen due to the advent of digital pictures. It is still used in electronics. It is basically a cheaper ornament.
Considering the diamonds, in this case the markets are not very clear or conclusive, as a single family controls about 70% of the worldsâ total diamond mines in South Africa. Since, the diamond market is almost a monopoly with less competition and is under the control of a private family is controlling them, they really should not be so expensive as they are made out to be.
search the word gold on Mises.org and you'll get lot's of very detailed articles on why.
Gold has been used as money for millenniums and is the reason the current fiat money systems were able to come into existence. The gold connection to the USD was severed permanently in 1971 which in historical perspective is not too long, 37 years.
Gold can not be forged or created out of thin air.
It can be stored relatively easily.
It's definitely not perfect but it's better than what we have now. By the way the last I checked if you divide the money supply by the official gold reserves of the US you get a value of $2500/ounce.
Thanks research12, that was an interesting answer. 
Thanks Gyles, that was a very informative answer.