I’ve talked before about how silver would make a run. And now it is.

Quietly, silver has been moving higher. It hit another 27-year high yesterday of $18.72 and shows no sign of letting up.

Silver has moved higher than gold this year. So far, silver is up 25% compared to 13% for gold.

Yet, gold is getting all the glory. It is the metal that they all talk about on tv, in the newspaper, on the websites.

When was the last time you saw a headline that said: “Silver at 27-Year High”?

Maybe it’s the problem with “27-Year High.” That doesn’t sound as glamorous as saying, “new record” or “record high.”

Get used to it. In 1981, silver rocketed to over $50 an ounce as the Hunt Brothers tried to “corner” the market. It artifically pumped up silver prices.

It will be awhile before silver hits “new highs”. But without the Hunt Brothers artifically driving up the price, silver is looking mighty high at these levels.

But it’s being ignored. If people laugh at you when you say you’re buying gold, imagine the response if you said you were buying silver?

If you had bought the Silver ETF, the SLV, on the first trading day of the year, you’d be laughing all the way to the bank.

Can silver go higher? Or is this a false rally?

Silver has been lagging behind gold’s rise in recent years. Historically, it doesn’t lag for long. Silver is unique in that it is both a precious AND industrial metal.

Don’t count it out. Watch silver.

Recently, one of my brothers informed me that he was just given a 1964 dime after he bought something at the store.

“So?” I said.

I was originally thinking it was some kind of “rare” event like that one Indian penny that everyone looks for.

But, in reality, it was even more interesting.

It turns out that dimes made before 1964 were made of 90% silver/10% copper (as were quarters, half dollars and other coins.)

These coins are called “junk coins” because they actually circulated so they are of no use to collectors. BUT, they are made of silver, which has intrinsic value.

And right now, it turns out, quite a bit of value.

The coins don’t correlate one to one with the price of silver because it is a lower grade silver than what you’d buy in jewelry. But the discount isn’t that great.

Those coins sitting around in your pockets could be worth quite a bit of money.

I found this recent ad on Craigslist from Colorado Springs:

I will pay you cash for your US silver coins dated 1964 and earlier. I pay a FLAT RATE of 9X face value. This means for dimes I pay .90 each; for quarters I pay $2.25 each; for half dollars I pay $4.50 each and for silver dollars dated 1935 and earlier I pay $10.00 each, yes 10X face for silver dollars. If you have any of these coins you wish to sell please check around and contact me if you want to sell. I usually can meet you on short notice in the Springs and pay in CASH!!

Silver is trading at $17.50 an ounce. Is 90 cents a good deal?

According to this silver site, coinflation, the Roosevelt Dime, the most common as it was produced between 1946 and 1964, would be worth $1.26.

Wow!

No wonder people are buying them up?

Find one in your pocket? Maybe it’s time to start collecting them.

Get one of those Kennedy Half Dollars lately? Maybe they’re not so annoying after all.

Also made up of 90% silver, one of those is worth $6.30.

That’s REAL cash.

Sorry- gotta go. I have to check my pockets.

I interrupt “housing week” once again to discuss another topic that is more pressing: agriculture.

While investors have been fretting over the bearish stock market, those investing in the agricultural commodities have been getting rich.

Ladies, forget about marrying a tech geek. Check out the farmers!

Wheat has been hitting new records this week. From the Financial Times:

“We have seen a rally of epic proportions in the wheat market,” said Greg Wagner, analyst at Horizon Strategies. “The question is how other agricultural markets will respond to this price race we are currently seeing.”

Prices have been trending upwards for weeks. But ask the man on the street, and he will know nothing about this great Bull market.

Wheat is hot- but not to the average person.

Wheat prices in Chicago, Minneapolis and Kansas all rose by their 30 cent daily trading limit yesterday as dealers looked forward to the latest supply and demand report from the US Department of Agriculture, due today.

Exceptionally strong overseas demand for high-protein spring wheat, which is used to make flour, has been a key driver of the recent rally. At the Minneapolis Grain Exchange, the March wheat contract hit a record $15.23 a bushel yesterday.

Does it sound boring to you?

Maybe.

But you can take advantage by investing in wheat contracts or through the agriculture ETF, the Powershares Agriculture ETF, ticker DBA, that invests in futures contracts for you on wheat, corn, sugar and soybeans. [In full disclosure, I own shares of this ETF.]

Afraid of buying into a bubble that is purely speculation?

This rally is being driven by supply and demand (for now.) There is not enough supply and too much demand. From the AP:

“Today’s trade is all about wheat. There’s an extremely short supply of wheat of superior quality, and some end users will pay whatever it costs to get it,” said Jay Calhoun, analyst with Walsh Trading.

It is the lowest inventory in three decades and demand is rising due to changes in diets in the emerging markets. And dry weather conditions have kept the crops down.

Forget milk. Got wheat?

There are major energy crises occuring on opposite ends of the globe this week.

In South Africa, Eskom, South Africa’s major utility, told businesses, including energy-sucking coal, platinum and gold mines, to shutdown due to a power shortage.

South Africa clearly has problems with its infrastructure and Eskom is having trouble supplying power to the country.

A few days ago, Eskom allowed the mines to re-open as long as they were at 80% power usage. Eskom promised the mining companies they could go to 90% power by the end of this week.

The shortage continues and so the mines will be forced to operate on only 90% power.

South Africa actually mines quite a bit of coal that is exported to Europe (among other things). What did the price of coal do this week? Yep. It soared.

This crisis isn’t going to be solved this week either. The government said to expect shortages through July.

There are pictures from Johannesburg with all of the street lights turned off. That is no way to run a modern city.

In China, things are worse.

Crippling snowstorms have frozen planes, trains and automobiles across the country. In Shanghai alone, nearly 3500 airplane flights have been cancelled in the last week. Without trains to transport coal, the cities in the interior are running low. 80% of China’s energy comes from coal.

Many businesses, including, again, mines, are being shutdown. From Bloomberg:

Zhuzhou Smelter Group Co., China’s largest zinc smelter, halted its main production plants Jan. 29 because of power cuts and snowstorms, the company said today. Zhuzhou has shut down all of its zinc and lead plants. China was a net exporter of zinc in 2007 and supplies a third of the world’s lead.

With the mines shutting down, that means world supply will shrink. Investors are rushing in to invest in miners outside of China who will benefit from the Chinese shutdowns and the rising prices.

Granted, these shutdowns might only last a week. But what if they last longer? More snow was forecast over the next few days. The Chinese government has sent in the military to try and maintain order and get transportation moving again. But some energy facilities are dangerously close to being out of coal altogether. From the New York Times:

But electricity shortages were expected to continue after supplies were disrupted to 17 provinces, or about half the country, in recent weeks.

The provinces of Guangdong, Guangxi, Guizhou, Hunan, Anhui and Jiangsu had the worst problems, with more than 30 million people affected by blackouts or brownouts, according to government estimates. Steel and aluminum output is also expected to suffer, analysts said.

“I think the current weather-related problems have major ramifications for the manufacturing sector and therefore the economy, let alone the fact you have a lot of unhappy people,” said Victor Shum, an analyst based in Singapore for the energy consultants Purvin & Gertz.

These snowstorms are reminding us, once again, that while China has built many shiny skyscrapers in Shanghai and other cities, it has a long way to go before the entire country is running efficiently (though, as one who worked in a darkened office in 1999 during the California brownouts, you could say the same thing about the United States.)

As an investor, how do you play these crises?

The world, and especially the Chinese, will continue to use coal for many years to come.

A new coal ETF just launched with the ticker KOL. The ETF is run by Van Eck Global and seeks to replicate the performance of the Stowe Coal Index. The Index provides exposure to 60 companies worldwide that are engaged in the coal industry.

The ETF is pricey. It collectively has a P/E of 40.65. But it does give you exposure to the world’s largest coal miners.

Remember, investing in these narrow sectors should only be a fraction of your entire portfolio. And always research any security before investing.

But the energy experts believe that coal will be in demand for many more years to come.

Right now, the world can’t get enough of it.

Coal is, suddenly, very hot.