I don't have enough knowledge of the gold and silver markets to make a specific price prediction.

However, I think it is very probable that $1 worth of silver or gold bought now will hold or more likely increase in purchasing power compared to $1 held in paper in 2007.

Bernanke believes he can prevent a credit implosion by printing money - either monetizing US debt paper or debt paper of quasi-governmental entities such as FNMA. I do not believe this will be effective in the long-term for various reasons too long to mention here. But, in this scenario, gold and silver, as well as other commodities, would increase in price because the measuring unit, the dollar, is shrinking. But a lot of other stuff would also increase in price, so the question really becomes, will the "price" of gold and silver increase at a higher rate than other goods and services? I think so, because I suspect a lot of folks will be looking to hold on to purchasing power and will be buying gold and silver, resulting in demand driven price increases larger than the general increase in price levels. If Bernanke prints enough dollars, we might even go through a "crack-up" boom, as Von Mises explained - where everyone wants to buy something tangible before the purchasing power of the dollar decreases even more.

In another scenario, a credit implosion occurs, money (as debt) is destroyed by rolling debt defaults. In this case, cash becomes more valuable, so the price of gold and silver would decrease, in nominal terms. But - I suspect the "prices" of gold and silver would decrease at a slower rate than general price levels, so while nominally they appear to have gone down in "price" they have increased their purchasing power, which would not be the case if wealth was held in paper dollars.

In concrete terms, my wild guess is that Bernanke will go for the first scenario, to try to keep a house worth $400,000 from decreasing in price in nominal terms. But when one looks at how much $400,000 will buy in real terms in a year, folks will discover that it is a lot less. $400,000 house, $6/gallon gasoline, $14/lb chicken, $25/ounce silver and $1300/ounce gold for example. But in previous dollar units, it's really a $200,000 house, $3/gallon gasoline, $7/lb chicken, $12.50/ounce silver and $650/ounce gold!

Apologies for the long response...

"In a country which is moving downhill, the fraction of stupid people is still equal to s; however in the remaining population one notices among those in power an alarming proliferation of the bandits with overtones of stupidity (sub-area B2 of quadrant B in figure 3) and among those not in power an equally alarming growth in the number of helpless individuals (are H in basic graph, fig. 1). Such change in the composition of the non-stupid population inevitably strengthens the destructive power of the s fraction and makes decline a certainty. And the country goes to Hell."

As a US resident, it is highly annoying watching this country make all the mistakes the Roman empire made in 200 years compressed into 20 years.