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Using Precious Metals as a Powerful Hedge Against Inflation
After years of planning and saving for retirement and for your future generations, the thought of losing all of your hard work to a volatile marketplace can be downright frightening. Our economy is still struggling and, as such, other investment plans including stocks, bonds, mutual funds, hedge funds, and others have become far less reliable and less valuable. How can you know for sure that your assets will be available to you 10, 15, or 20 years down the line? It is in times like these that the most savvy investors consider the true worth of precious metals. If you have been giving some thought to investing in precious metals for your first time, here is a quick guide to three of the most popular and reliable options: gold, silver and platinum.
1. Gold - Of all of the precious metals, gold is most certainly the grand-daddy of them all. Since the beginning of time, gold has been perceived as a valuable commodity, and that notion has never changed. Gold is extremely unique, not just because of its glittering looks, but because of its extreme durability (it never rusts or corrodes), malleability, and it’s uses in conducting both heat and electricity. Because of this, gold is utilized in the making of jewelry, as well as in a wide range of technical, medical, and industrial applications. Knowing that, it is easy to see why gold is so valuable and in such high demand at all times. And it is this high demand that has ensured that over the course of its 5,000+ years of being used by people, gold has never failed. Ultimately gold trade is far less affected by the laws of supply and demand, making it an ideal investment choice in times of political instability, market fluctuations, and in war times. This rock-solid investment will ensure that your finances are secure and that your assets are protected, no matter what happens.
2. Silver – Another popular choice in terms of investing in precious metals is sliver. Although the price of silver has been known to fluctuate, making it more volatile than gold. Even so, during its “stronger” periods, silver has proven itself to be a wise investment. Silver is frequently utilized in jewelry making and in industrial applications, as it is highly useful in electronics, medical products, batteries, microcircuits, and others. Additionally, silver is quite rare, above ground. At present, there’s only enough investable silver in the world for every person to obtain just 1/14th of an ounce, and throughout the past 30 years alone, the population has consumed far more silver than has been mined. As a result silver inventories are approaching their lowest volumes ever. This means that whenever the market swings back in favor of silver, it can be sold for a significant profit. . By buying low and waiting to sell high, you can grow your assets in silver.
3. Platinum – The final of the three precious metals that we will explore is platinum. Because it is extremely rare, platinum actually tends to fetch a higher price than gold during routine times of market and political stability. Platinum is in demand within the automotive sector and in jewelry making. And as it is a valuable tool in reducing harmful auto emissions, platinum has grown quite popular in the design of new, eco-friendly vehicles. However, because platinum mines are heavily concentrated in South Africa and Russia, investors should note that while certainly valuable, platinum is the most volatile of precious metals.
Work with your financial advisor to find the right investment in precious metals for your own specific needs.
How Much Silver is Left in the World
As an investor in today’s economy the emphasis needs to be placed on preserving the wealth you’ve already earned. The stock market, while hitting recent all time highs is being driven more by FED monetary policy than actual profits, inflation is already in the pipeline due to the increase in the M1 and M2 money supply, and bond yields are being kept artificially low to stimulate the economy.
Many smart investors have turned to precious metals as a way to hedge against future inflation, and economic uncertainty. Precious metals also offer an excellent opportunity for long-term growth. Physical possession of metals is a smart investment in which a position can be built slowly and privately over time, away from prying eyes. Silver is highly liquid, easily portable and its value is recognized worldwide.
Since the bull market in precious metals began in 2000 the price of gold has risen over 575% from a price of $272.00 per ounce to a recent price of over $1600.00. While gold was posting these incredible gains, silver’s prices quietly outperformed gold’s in percentage terms with an unbelievable 600+% rise to a recent high of $29.00 per ounce. In fact, of the entire commodities group, silver has been the top performer in percentage terms since 2000.
Silver’s Price Drivers
Silver (along with platinum) holds a relatively unique position among the precious metals in terms of demand. In addition to being a strong store of value and a hedge against inflation, silver has strong demand as an industrial metal. It is used in green technology and nanotechnology. It also has anti-bacterial qualities that make it valuable for medical use. Silver also has strong demand as jewelry and for decorative use in the home. When you invest in silver, you are investing in a metal that has a built in demand on many levels.
When silver is used in certain industrial applications, it is in essence permanently removed from the supply chain. As industrial use increases, supplies are dwindling. Mine production rose a modest 1.4% in 2011 to 761.6 metric ounces. These gains were largely due to by-product production from gold and lead/zinc mining. While supplies in 2011 stood at 761.6 Moz, fabrication demand was robust at 876.6 Moz. The estimated supply of above ground reserves of silver currently available for delivery stands at around 600 million ounces. While new mines are beginning to come online, it can take years to produce meaningful amounts of the metal for fabrication.
The Silver Supply/Demand Imbalance
This supply/demand imbalance has begun to show up in the investor market. Recently the U.S. mint had to suspend production of Silver Eagles due to a lack of available blanks for minting. In 2011 the supply/demand imbalance was over 100 million ounces. As industrial silver use increases, this deficit may continue to expand. With current silver available for delivery at 600 million ounces, this represents 6-years of deficit supply coverage. It should also be noted that these worldwide production figures include Government sales and “scrap” which may account for as much as 25% of the total worldwide production numbers. If this figure were removed, worldwide demand would exceed supply by approximately 37%.
Invest in Silver
As demand continues to exceed supply, investors may see a rise in the premium over spot price for investment grade silver bullion. The time to invest in silver is now.
Swiss Metal Assets is selling silver with some of the lowest premiums in the industry. Check it out here.
When Does Buying Silver Make Economic Sense (If Ever)?
Silver and gold have been a regular part of life since the beginning of time, but it is only within the last 200 years that people have seen gold as a true, traditional investment option. Gold and silver are both making headlines as of late because the current interest in the commodities as an investment option. Truth be told, gold and silver are both solid investment options for people from all walks of life and now is the proper time to get involved in the commodity.
A troubled economic climate and a rocky stock market has turned many investors towards physical commodities, mostly in the form of silver and gold. Investors are turning to investment opportunities in strategic and precious metals for one reason and one reason alone; it simply makes sense right now. The option to invest in silver, at the moment, is a solid economic decision. The rocky stock market has led people towards these physical commodities because they can see and feel them, but more importantly, the price of both gold and silver continue to rise, even as the stock market falters.
Gold prices are at an all time high and they expected to continue rising. That makes investing in gold an expensive endeavor. The silver price, alternatively, remains relatively low, but analysts believe the price will head northward in 2013 and beyond. The current price of silver and predictions for a price rise, means now is the best time to invest in silver.
There are several ways to invest in silver as well and each needs to be considered before making the move towards metal as an investment pieces. One can choose to invest in actual silver coinage. This method involves buying actual, silver pieces and storing them for investment purposes. While this is a “safe” investment option keeping silver around is difficult and takes up space. Alternatively, one can choose to buy funds in an ETF. An ETF has silver holdings in a vault. Those who invest have a portion of that vaults physical metal commodity. This option is one that most people are most comfortable with as it is tied to the real silver commodity, but the investor does not have to store silver themselves.
Another way to invest in silver involves buying stocks. Stocks can be purchased for just about anything, and silver mining companies do exist on the stock market. For people who are most comfortable with the stock market investing in a mining company makes the most sense. While big returns are possible, there is the same risk associated with this option as with other, traditional stock options.
Now that you understand how to invest in silver you are likely wondering when the best time to do so is. Simply put, the best time to invest in silver is right now. The silver prices remain low and the predictions for their appreciation appear unanimous. With a rocky stock market and concerns of a fiscal cliff there is no better time to buy in a touchable, precious metal than right this second. Getting in on the ground floor of the rising silver prices is the best possible way to recoup an investment and build a solid profit off of it.
Industrial Uses of Silver You May Not Know About
The exact time to invest in silver or any other precious metal is never certain but one fact is for certain; precious metals, in general, and silver in particular are becoming rarer every second of the day. Not only are they prized for their inherent value but they are also used in a wide variety of much needed manufacturing and industrial processes. From its inclusion in jewelry through its use as biological reagents to its use as a catalysts in almost every industrial textile application, silver is in strong demand by almost every industry throughout the world. Here are some of its more important uses:
Medicine & Pharmaceuticals
In addition to its usual use in the dental amalgams used to fill cavities, silver is also of benefit to the medical industry because of its germicidal properties. Many topical creams, gels and impregnated bandages contain silver as their antimicrobial agent. Silver is used for tracheal tubes and for catheters because of the demonstrated, reduced risk of bacterial infection.
Petrochemicals & Textiles
The superior catalytic properties of silver make it ideal for use in many commercial oxidation reactions. In particular, screens composed of almost pure silver are used to create formaldehyde from methanol and silver is also the only catalyst available to affordably make ethylene oxide, an important step in the synthesis of polyester.
Music & Electronics
Silver has long been a favorite of audiophiles who insist that the use of silver in the conductors of audio connector cables, speaker wires, and power cables provide a pure, more desirable sound. Similarly, many musical performers embrace the tonal qualities of silver and silver alloy musical instruments. Silver is also a key component in the construction of most electronic “motherboards” and I many advanced, miniaturized batteries.
Advanced Technology
While the term “silvering” is actually a misnomer for most everyday mirrors – aluminum is more commonly used – silver is used in high-end applications such as telescopes, including the Hubble Space Telescope. In addition, silver can be found in the best photovoltaic cells in solar power generating systems. Lastly, silver is the chief component in the control rods of many nuclear reactors.
The Bottom Line
As can be seen, silver, its alloys and its compounds are used across a broad range of industries. While many of these applications use only a small amount of silver per item, the sheer magnitude of these operations consumes immense quantities of the metal. The demand for silver only continues to grow as new uses are found for this incredibly versatile metal.
It is an almost immutable law that as demand increases, so does price. Prices for silver have steadily increased over the past decade. More and more investors are turning to precious metals and silver in particular, as a hedge against future economic uncertainty and as an excellent investment. In short, there may never again be a better time to invest in silver.
Due to its industrial applications, silver makes a strong investment. Click here to learn about more reasons to invest in silver.
Why You Might Want to Consider Adding Some Silver to Your Portfolio
Silver bullion is one of the most commonly traded commodity’s in the precious metals market. And by acquiring it, storing it, and adding it to a portfolio of mutual funds, stocks and bonds, you’ll be adding a tangible
Silver Prices
ingredient to a mix of intangible, and fluid, assets. This goes back to the heart of basic economics…never concentrate the entirety of your assets into a single, volatile investment. Some, at the very least, should be stored safe, even if you eventually plan to use it as capitol.
The economic factors that determine the value of precious metals are generally in direct opposition to those that determine the fluidity and volatility of other, more common, assets, like mutual funds, stocks and bonds. Because of this, moving a significant chunk of your assets into silver bullion can add balance to your assets and decrease overall volatility.
Over the last several decades, the U.S dollar has seen a dramatic, though steady, decrease in value, and economists suggest that this will continue to be the case for many years to come. Investments in silver have been proven to provide financial independence from inflation. It is estimated that between 1971 and 1981, the U.S dollar saw a 50% decrease in value. Silver, on the other hand, remained untouched, and its value in the same time period rose by nearly 500%. Economies swell and recede, and their facets, inflation, recession and expansion, swell and recede with them. The precious metals market, specifically silver, exists independent from any and all paper economies, thereby ensuring stability even in the most difficult of times.
Because of this, it is suggested that no matter what your investment patterns are – whether you invest aggressively or you take a more conservative approach, 10-15% percent of your assets should reside in the precious metals market. Whether you leave your assets untouched for the most part or move them around as most people do; it always good to have something to fall back on, and so far, investments in silver have been proven to be a dependable source of capitol.
For those of us who wish to remain independent from the stock market, and the silver reserves that they trade by, owning physical metal has an unbelievable appeal. This is because the fees on trading silver bullion pale in comparison to those required by banks. A typical silver dealer will ask the current spot price plus fifty cents for a troy ounce of silver bullion, and this can vary depending upon the market.
Silver bullion coins are variably inexpensive, and can be traded internationally. Because of their small size they can be easily stored in a safe location of your choosing. In addition to the low commission fees on buying and selling, physical bullion can be transferred at your leisure into instant cash, whereas commissions on electronic fees could take up to a week to show up in your account.
Are you thinking about investing in silver? Contact us here for more information.
The Pitfalls and Dangers of Investing in Silver
It might seem strange having a metals company write about the disadvantages of making an investment in silver. But, every investor is different, and I know that you can’t make an informed decision without knowing about the pitfalls, as well as the hype behind this powerful opportunity.
Just like any other type of investment, silver has its fair share of disadvantages. One is that when you chose a silver investment you may need a larger storage space; because it is less valuable than gold. If the nominal value you are aiming for is equal to a certain number of gold bars, then you would require a space that is at least sixty times bigger and this is not ideal. Over time, the storage could become difficult due to lack of space.
This precious metal is very rare and can be subjected to taxation as a collectable. For this reason, the tax rate could be higher than capital gains on other investments. Every country is different, and tax laws change regularly, so it is important to check with a tax accountant.
Silver takes a while to return profits, so it is not suitable for those who are looking for short term investment opportunities. In the long run it might end up not bringing you any profit; it would just save your capital from financial inflation. These are the overall reasons that people prefer not to invest in silver.
Silver is referred to as poor man’s gold because of its cheaper price. This cost makes it more viable to a lot of people who are not rich. There are several ways of investing it and they are;
a) Physical silver – this can be invested in the form of;
- Coins
- Bars
- Rounds
Coins can be purchased from brokers. The coins available today are almost 100 percent pure. Traditional U.S silver coins include Morgan, silver mercury and peace dollars. The disadvantages of these coins are:
- They require secure storage
- They do not yield interest
- They have premiums over the bar prices
Bars are very traditional forms of silver and they are available in many sizes. There are private silver mints from which a direct purchase of silver bars can be done. In some countries it is possible to buy them in bulk and sell them over the counter. The short comings of bars are;
- They need secure storage
- They do not gain interest
- Evaluation may be needed at the time of sale
Rounds are a cross between bars and coins. Several mints produce them and they have an ounce of silver in the shape of coins without being legal tender. Custom made rounds can be ordered if you want your batch to stand out. The disadvantages of rounds include;
- Lack of interest
- Need to constantly keep a keen eye on it
b) Silver mutual funds
These funds specialize in silver by investing in the silver or mining stocks. The drawbacks are;
- It is more expensive than investing in real silver
- It needs you to have knowledge of the equity market.
c) Silver mining stocks
In this option people opt not to invest in silver directly but to purchase shares in silver mining companies. The drawbacks to this are:
- It is more expensive than buying sliver directly
- You need to be knowledgeable in the stock market. It is riskier than any other investment plan
Even after all of these disadvantages, there are advantages to silver, like a lower barrier to entry, and a greater upside potential than gold. And for those reasons, it does make a valuable addition to your portfolio, and we can certainly help you out when investing in silver.
But we have an alternative I think is even better. It can have a greater upside than silver and better inflation fighting properties than gold. And you can be one of the first to learn about it by downloading our rare strategic metals asset protection report, for free here.
What Should Silver and Gold Investors do?
Today there was an article on CNBC telling us that the Bull market in silver is finished. Last week we heard that the Bull market was finished in Gold. What is an investor to do with all the noise around us? When silver was approaching $50 in June 2011 the media was happy to tell its viewers and readers to buy. It is very difficult to focus on the end game when the media continues to get it wrong.
The public keeps falling for the same trick year after year. Peter Schiff, Congressman Ron Paul and Marc Faber all said that the real estate bubble would burst while the media laughed at them. Today we have the media telling us that it is ok to bring our hard earned currency back into the stock market. Does all seem well to you? My gut feeling is telling me that something is terribly wrong with the system and that the risk of a serious crisis is still a possibility.
I would like to share with you my approach to precious metals investing. My approach may seem ultra conservative, but it has worked for almost a decade. Physical metal in my possession or 100% allocated in my name in a private vault is the only way to go for my family. I do not worry about the ups and downs of the silver and gold market. When it is time for a purchase, I do not try to time the market. When the cash is available I place an order. People ask me, ¨Randy why are you not worried about silver and gold crashing?¨ My reply is easy, do you really think that the governments around the world are going to show restraint when it comes to devaluing their currencies?
Here are a few reasons to not trust currencies.
- China has signed 16 currency trade agreements bypassing the US Dollar.
- Ben Bernanke and the Fed have announced that they want to continue to devalue the US Dollar.
- Trade wars, nations trying to keep their products cheap by devaluing their currencies, recently Brazil said the government will use this tactic.
- Governments around the world are devaluing currencies to pay off national debt, instead of raising taxes. Raising taxes is political suicide.
The other question people ask is, “when will you sell?¨. The answer to this question is a very personal one, but my approach is pretty simple. I have a set goal for the value of my metals. When the price reaches that value, I will then sell my silver and gold and buy real estate or possibly equities. For me the precious metals are a tool to build wealth. When I sell, I am just moving to a different asset class. When I can buy a $100k house for 600 ounces of silver it will be time for me to sell. Similar to everyday life, if we don´t focus on set goals, we will accomplish very little. Even if it takes another five years for silver and gold to reach my price goals I am okay with it.
Will there be times in the climb forward, when silver and gold take large price drops? Of course there will be, but these are the times when the market just gave you the opportunity to buy more precious metals at a discount. I am just an average guy who wants to be able to sleep good at night. I don´t want to be worrying whether or not my call or put options are in the money. So if you want peace of mind, please do not listen to the media, focus on your goals and you will be ok.
Silver set to shine after escaping India’s budget clutches
While gold’s southward journey continued for the third straight day in Mumbai Monday, investors showed a keen interest in buying one kilo silver bars also known as `chausar’ given the excise duty exemption.
MUMBAI (MINEWEB) -
Silver, the poor man’s gold, has turned out to be the winner in India’s budgetary excise duty cuts by escaping the attention of the Finance Minister. Investors in India are keen to push silver above the recent channel high with traders insisting that it will be more than speculation that will drive demand for the white metal.
“Silver has clearly been exempted for a reason,” said Prithviraj Kothari, president of the Bombay Bullion Association. “Out of $50 billion worth of imports of precious metals into India, silver imports were just $4 billion, while that for gold was the other $46 billion,” he said.
On Friday, India’s Finance Minister exempted branded silver jewellery from excise duty. Silver coins of purity 99.9% and above were also exempted from excise duty. However, the excise duty on refined gold was doubled from 1.5% to 3%.
Kothari was of the opinion that silver coins and silver bars, called `chausar’ in the local lingo and among bullion traders across the country, would soon sell like hot cakes. “There is not much demand for silver jewellery among Indian investors. Most go for high value silver coins or for a 1 kilo silver bar. The latter is expected to fly off the shelves now and investor interest would surely be pushed higher as a consequence of the double whammy on gold in the budget,” he added.
Kothari added that the price of silver was bound northward since investor interest had shifted given its usage in solar panels. Panel makers consume about 12% of the world’s supply of silver, the material in solar cells that conducts electricity.
Silver paste is used in 90% of all crystalline silicon photovoltaic cells, which are the most common solar cells. Though the solar industry is not the largest consumer of silver, it is a growing market that could give silver producers a boost, say traders.
“It is something whose time has come. Most of the markets that silver serves follow traditional supply and demand economics and therefore competition is based on price, product line, and service. In the case of a hyper growth industry such as the photovoltaic industry, silver is bound to streak ahead,” added Kothari.
The rise in solar power is arguably the most significant development for silver demand in recent years. A GFMS report noted that over the last decade, the sector’s offtake had climbed rapidly, soaring from less than 2 million ounces to an estimated 50 million ounces in 2010. In 2011, demand was expected to reach nearly 70 million ounces, an increase of 40% year on year. So analysts expect demand from this segment to keep growing.
In precious metals, silver was down 0.65% in the international markets at $32.36 an ounce, bringing the gold to silver ratio, which is the number of ounces of silver needed to buy one ounce of gold, to around 51.0, the highest for two weeks and reflecting silver’s underperformance relative to gold.
In India, a depreciating currency has also played spoilsport. The Indian rupee has tumbled by 16% against the US dollar. Some traders insist that as silver was left out of the latest budget tax increase, it may benefit from speculative plays and the spread between gold and silver should narrow.
“Silver has remained outside the double tax on other precious metals. But one should not forget that recently the silver import duty was raised to 6% of the value to discourage imports and enable better utilisation of forex reserves,” said Sunder Raghavan, bullion trader.
“In purely psychological terms, the news is likely to weigh on the price of gold and in the current market could help ensure that the gold price does not increase significantly in the near future,” Commerzbank analysts said in a note, adding that following a rollercoaster ride in 2011, rising industrial demand coupled with growing investor interest should prompt a sustainable increase in the price of silver this year.
In the case of gold though, the analysts have said, “This could lead to lower imports, which would remove an important crutch from the price of gold.”
Traders point out that silver has several industrial uses. “This year, it is estimated that global industrial demand for silver largely driven by India and China will increase by 30%, from 487 million ounces in 2010 to 624 million ounces. At a time like this, the Finance Minister excusing silver from its taxation basket is heady news,” said Udayan Murti, bullion analyst with a broking house.
Kothari was of the opinion that though India imported around 4,800 tonnes of silver last year, this year imports would hinge around 3000 to 3500 tonnes. “Last year there was a lot of consumption. With inflation on the rise this year, there is not much savings left in the hands of individuals. Though the `chausar’ bars are still a hot property amongst the regulars, the budgetary proposal to fully exempt branded silver jewellery from excise duty will result in an increase in the number of branded silver jewellery items. Currently, there are only a few brands in that segment. So, that will be one segment that is bound to grow now,” he added.
Traders and analysts added that silver has been the underestimated bullion with immense savings potential that may help in capital formation for future growth. “This (exempting it from budgetary tax) seems to be a welcome step to realise its untapped potential. Moreover, it has a broader reach across income groups compared to other precious metals, because of pricing,” said Murti.
By: Shivom Seth
Source: http://www.mineweb.com/mineweb/view/mineweb/en/page32?oid=147564&sn=Detail&pid=32
President Obama Signs an Executive Order Allowing for Control Over Natural Resources
President Obama and Tim Geithner
Some disturbing news came out of Washington on March 16th. The President of the United States has decided to expand upon the 1950 Disaster Preparedness order. This order gives the President of the United States total control over all natural resources in the country during war time or emergencies. The new order has expanded the power of the President to control everything from food, transport, production, energy, materials and water. I say how can this be possible? I see the possibility of abuse here. What could go wrong? Should we let our natural resources be controlled by a handful of people? Here is the order.
Section 101. Purpose. This order delegates authorities and addresses national defense resource policies and programs under the Defense Production Act of 1950, as amended (the “Act”).
(b) assess on an ongoing basis the capability of the domestic industrial and technological base to satisfy requirements in peacetime and times of national emergency, specifically evaluating the availability of the most critical resource and production sources, including subcontractors and suppliers, materials, skilled labor, and professional and technical personnel; - White House
Additionally, each cabinet under the Executive Branch has been given specific powers when the order is executed, and include the absolute control over food, water, and other resource distributions.
Sec. 201. Priorities and Allocations Authorities. (a) The authority of the President conferred by section 101 of the Act, 50 U.S.C. App. 2071, to require acceptance and priority performance of contracts or orders (other than contracts of employment) to promote the national defense over performance of any other contracts or orders, and to allocate materials, services, and facilities as deemed necessary or appropriate to promote the national defense, is delegated to the following agency heads:
(1) the Secretary of Agriculture with respect to food resources, food resource facilities, livestock resources, veterinary resources, plant health resources, and the domestic distribution of farm equipment and commercial fertilizer;
(2) the Secretary of Energy with respect to all forms of energy;
(3) the Secretary of Health and Human Services with respect to health resources;
(4) the Secretary of Transportation with respect to all forms of civil transportation;
(5) the Secretary of Defense with respect to water resources; and
(6) the Secretary of Commerce with respect to all other materials, services, and facilities, including construction materials.
(e) “Food resources” means all commodities and products, (simple, mixed, or compound), or complements to such commodities or products, that are capable of being ingested by either human beings or animals, irrespective of other uses to which such commodities or products may be put, at all stages of processing from the raw commodity to the products thereof in vendible form for human or animal consumption. “Food resources” also means potable water packaged in commercially marketable containers, all starches, sugars, vegetable and animal or marine fats and oils, seed, cotton, hemp, and flax fiber, but does not mean any such material after it loses its identity as an agricultural commodity or agricultural product.
How do I translate this? Is the Executive branch telling us that an expanded war is on the horizon, and that they are worried about shortages? How will the American people respond to another war? Spring has arrived in America, how will Occupy 2012 play out?
If there is war I do believe it will bring instability to an already unstable market and world economy. During war time nations tend to spend huge amounts of money causing increased inflation. This translates into everything costing consumers more. Oil prices will continue to rise as well as anything you purchase at the market.
What can you do to prepare for the increased costs ahead?
- Plant yourself a garden and learn how to can to keep your grocery bill under control.
- Buy some Precious Metals like Silver and Gold. My choice is Silver.
- Buy yourself a small portable Solar unit.
- Buy a sturdy bicycle with a rack on it. My Trek is a great bike. Ride it!
- Find like-minded individuals in your community.
- Make sure you have access to water or store some.
- If you are adventurous like myself, expatriate to another country and start a new life.
I was raised by a family who taught me to always be prepared for the unknown. My family always had reserves for times of emergency. Do you want to rely on the government when instability arrives? It looks to me like the government is preparing for something big, maybe you should do the same.
The Silver Stage has been set for Grand Performance in 2012
HISTORY – Silver is the most electrically conductive of all elements and has the highest thermal conductivity of any metal. Its atomic number is 47.
Silver has long been valued as a precious metal, and it is used to make ornaments, jewelry, high-value tableware, utensils (hence the term silverware), and currency coins (the only country today that still uses silver coins in circulation is Mexico, while the US ceased using silver as currency in 1965, though several more coins with lesser silver content were produced until 1969). The US mint began producing silver bullion coins in 1986 and silver proof versions of the half-dollar, quarter and dime (along with conventional metal dollars, nickels and pennies) in 1992 and continues to make the silver bullion and silver proof versions of currency today.
Today, silver metal is also used in electrical contacts and conductors, in mirrors and in catalysis of chemical reactions. Its compounds are used in photographic film, and dilute silver nitrate solutions and other silver compounds are used as disinfectants and microbiocides. While many medical antimicrobial uses of silver have been supplanted by antibiotics, further research into clinical potential continues.
Much of the two previous paragraphs was gathered from Wikipedia.org under silver and credit is hereby given.
SILVER AS CURRENCY – One of the earliest known uses of silver as currency was as used in Electrum, a gold-silver alloy utilized by the Lydians (which would now be part of Turkey) in 700BC. The British currency, pound sterling, reflects the fact that it originally represented the value of one pound of silver. Similarly the French Livre has a similar etymology while plata in Spanish means both silver and money.
The earliest silver US coin was the flowing hair dollar in 1794. Although silver coins had been accepted as currency in the colonies at least 40 years earlier as the Spanish eight reale also called “pieces of eight.”
MODERN SILVER PRICE ACTION – The Hunt bothers, Nelson Bunker and William Herbert borrowed a great deal of money in addition to their substantial fortune in 1980 in an attempt to corner the market in silver. They succeeded in driving the price to $49.45 per ounce but ended up losing a fortune in their attempt. Considering the effect of inflation, that peak equates to somewhere between $137 and $150 per ounce today. That peak (on an absolute basis) was surpassed on April 25, 2011 when cash silver reached $49.752 per ounce.
CURRENT PRICE OUTLOOK – Since then silver has failed to continue the preceding sharp uptrend and reached a relative low of $26.046 on September 26, 2011. Little more than three months later on December 29, 2011 the price bounced from $26.151. Since this was not a major bottom but rather a bounce off support in a secondary reaction, thus it was not a double bottom, but a spectacular trade opportunity nonetheless. Within two months to the day (2/29/12), silver topped out at $37.430.
The price action since the new high in April of 2011 has formed a flag. The base of that flag is the rally that began in December of 2008 at a price near $11. The bottom of the flag is about $33. Thus the anticipated breakout outside the top of the flag is $33-$11 or $22. Assuming we breakout of the top of the flag at a price of $38, that anticipates a move to $60. Since this pattern has been forming for 3-1/4 years it would not be surprising for it to take a like period to make the anticipated price target.
The most recent price run-up was the move from $26.151 on December 29, 2011 to $37.43 on February 29, 2012. Many traders tout Fibonacci retracements as trading strategies and the most reliable of those retracements is 50%. There is a book that has been written regarding trading 50% retracements and it is titled, “The Trading Rule That Can Make You Rich”, by Edward D. Dobson © 1979 Trader’s Press, Inc.® The 50% retracement that results from those two points is $31.79. This perceived bounce could occur at any time.
By CD Hopkins Metals Division
Source: http://www.sacbee.com/2012/03/07/4317699/the-silver-stage-has-been-set.html
Silver Price Could Double by Year’s End
Were you cursing at your computer screen when silver nearly tripled during the short 9 months from September 2010 to May 2011? Silver at $20 seemed like an insurmountable threshold for quite some time. This caused many silver investors to give up just prior to the ascent, completely missing the ride towards $50. I believe silver is about to offer a similar ride. While it is unlikely to match the 180% advance mentioned above, look for silver to make new highs in the coming months, with the potential to double to $65 by year end.
Following the record gains in silver during late 2010 and early 2011, the metal crashed towards $25 and has since rebounded to around $33. Investor sentiment has crashed along with it. The threat of Euro nations defaulting, banks announcing they are, well, bankrupt, and a series of other factors have scared away many of the Johnny-come-lately silver bulls.
I think too many investors are underestimating the power of the central banks. While I agree they are running out of options, it seems that their ability to kick the can down the road has yet to expire. Given that the United States is heading into election season and President Obama is in full campaign mode, I expect the administration to pull out all stops in order to continue the illusion of economic prosperity a while longer. Every economic fire of consequence is being extinguished with fresh liquidity, more funny money or new legislation. In case you missed it, QE3 has been in full force for quite some time, albeit executed in a somewhat stealth manner.
The implications for silver (and gold to a lesser degree) are going to be incredibly bullish. Absent a deflationary sovereign default that spirals out of control and takes down major banks with it, stocks will continue to creep higher in volatile trade throughout the year. Once fear begins to subside, look for precious metals to come roaring back to new highs by mid-year. Whenever the next financial crisis finally hits, we are likely to witness a new injection of quantitative easing that is even stronger than what transpired in 2008.
Will a major debt default pull down gold, silver and mining stocks with it? Absolutely.
Will it last? Not likely.
Investors are a predictable bunch. They always overshoot on emotions in one direction or another. A rush for liquidity and the perceived “safety” of government bonds or U.S. dollars will be incredibly short-lived and viewed in retrospect as immensely short-sighted. Everyone that rushed for the door by dumping real assets will soon regret their folly. When the fear subsides and some semblance of rational thought returns, the realization of the worthlessness of government paper will be widespread and cause a mass exodus of fiat money.
So while it is prudent to hold a decent amount of cash in the short term, hoping to buy the irrational dip, the medium to long-term investor might consider buying silver aggressively at this juncture. In my view, commodity prices are either going to continue grinding higher throughout the remainder of the year, or there will be a short and steep dip, following by a resumption to new highs.
Either way, the silver price has a long way to go before reaching previous inflation-adjusted highs. It would need to climb to $150 to reach its 1980 high using officially-suppressed inflation statistics and closer to $300 using honest inflation statistics. Seeing as you can buy silver at around $33 today, the upside potential remains absolutely huge. Let’s take a look at the long-term chart to determine price targets for 2012 and 2013.
Charting back to the start of the silver bull market, we can see that silver remains firmly in its multi-year uptrend. Contrary to negative sentiment expressed by some analysts, there has been no significant chart damage or other action to suggest that the bull market has run its course. Silver recently bounced off the bottom line of its trend channel, which also corresponds roughly with the 100-day moving average. This line has provided support during every one of silver’s corrections over the past decade, with the exception of the 2008 financial crisis. I expect it to continue to provide support during the current correction/consolidation.
While we could see one more quick dip below $30, I think any talk of a decline to $25 or lower is now firmly off the table. Silver is currently facing resistance at the critical level of $35. If it breaks to the upside through this level, I believe silver will quickly climb to challenge the $50 mark once again and reach a high between $55 and $65 by year end. To the downside, I think the lowest silver will close out the year is around $31, in the event that short-term deflationary forces take hold. But as mentioned earlier, I think the central banks stand ready to do whatever is necessary in order to prevent such an outcome.
These projections are relatively conservative and based on the long-term trend trajectory. Any number of events could send silver parabolic in the blink of an eye. The silver market is tiny in relationship to the paper money market and if even a small percentage of those dollars decide to buy silver, demand will overwhelm supply and send prices into triple digits. I ultimately believe silver could reach $500, but the more important consideration is the value/purchasing power increase of silver. One thousand ounces of silver used to be able to buy a median-priced home in the United States and I believe one thousand ounces will once again achieve this same feat in the near future.
Some view silver as an inflation hedge or way to preserve purchasing power. I see it as a way to vastly increase purchasing power over the next several years, with the worse case scenario being wealth preservation. I’ll take that risk/reward scenario any day.
The fundamentals are very strong for silver at this juncture. The Obama administration just put forth a budget that will result in another annual deficit of over $1 Trillion, despite promising to cut the deficit to $650 billion. The ECB is bathing Euro banks in liquidity and the US Fed has literally guaranteed an inflationary environment until late 2014. These policies create ripe conditions for commodities overall and precious metals in particular to make new all-time highs.
With less above-ground investment-grade silver available than gold, the supply/demand situation can not persist much longer at such depressed prices. Physical silver demand is growing and confirming our bullish view, as Silver Eagle sales for January posted the second strongest month ever at 6.1 million ounces!
Lastly, silver is the best form of money to own in the event of a collapse in fiat currencies. It will be difficult to use a gold eagle for small purchases, but silver eagles and junk silver will be ideal to use in purchasing food and other goods when the U.S. dollar is no longer accepted. This makes silver attractive not only for the strong returns and ability to increase an investor’s purchasing power, but also as a valuable insurance policy should the current monetary system break down.
So don’t miss the train again this time around. While silver is currently in consolidation mode, this is not likely to last long. When the silver price finally takes off once again, there will be little notice or opportunity to jump aboard the speeding train. Silver remains severely undervalued in my estimation and I expect the price to skyrocket in the near future as it approaches new highs.
You need only have the courage to take the path less chosen, buy when others aren’t interested and sell when the herd is clamoring to buy silver at any premium. While the next financial crisis may begin with panic selling of precious metals, I believe it will quickly flip to panic buying at very high premiums to spot price. I want to be well-positioned before this occurs and also have some funds on the sidelines to relieve panic sellers of their gold and silver at discount prices. A sensible approach that I advocate is to purchase in tranches, building a position now and adding to it every month or two. This will help to ensure that you don’t go “all in” at a short-term top and have funds available to take advantage of any major dip. Attempting to time the absolute bottom is nearly impossible, so I view this a opportune moments to establish or increase positions in silver.
I am currently adding to my positions, both in physical silver and undervalued silver mining stocks. The equities underperformed significantly last year, but against the backdrop of unlimited central bank easing and liquidity, I think we are likely to see a return to the leverage offered during the early stages of this bull market. Junior mining stocks in particular appear very undervalued at this juncture and could offer staggering gains if my analysis is correct.
*Post courtesy of Jason Hamlin, founder of Gold Stock Bull, a monthly contrarian newsletter that contains in-depth research into the markets with a focus on finding undervalued gold and silver mining companies.
Source: http://www.wealthwire.com/news/metals/2746?r=1
Silver Eagles Soar!
In World War I severe material shortages played havoc with production schedules and caused lengthy delays in implementing programs. This led to development of the Harbord List – a list of 42 materials deemed critical to the military.
After World War II the United States created the National Defense Stockpile (NDS) to acquire and store critical strategic materials for national defense purposes. The Defense Logistics Agency Strategic Materials (DLA Strategic Materials) oversees operations of the NDS and their primary mission is to “protect the nation against a dangerous and costly dependence upon foreign sources of supply for critical materials in times of national emergency.”
The NDS was intended for all essential civilian and military uses in times of emergencies. In 1992, Congress directed that the bulk of these stored commodities be sold. Revenues from the sales went to the Treasury General Fund and a variety of defense programs – the Foreign Military Sales program, military personnel benefits, and the buyback of broadband frequencies for military use
American Silver Eagle
The American Silver Eagle is the official silver bullion coin of the United States. It was first released by the United States Mint on November 24, 1986 and is struck only in the one troy ounce size.
The Bullion American Silver Eagle sales program ultimately came about because the US government wanted, during the 1970s and early 1980s, to sell off what it considered excess silver from the Defense National Stockpile.
“Several administrations had sought unsuccessfully to sell silver from the stockpile, arguing that domestic production of silver far exceeds strategic needs. But mining-state interests had opposed any sale, as had pro-military legislators who wanted assurances that the proceeds would be used to buy materials more urgently needed for the stockpile rather than merely to reduce the federal deficit.” Wall Street Journal
The authorizing legislation for the American Silver Eagle bullion sales program required that the silver used for the coins had to be from the Defense National Stockpile. By 2002 the DNS stockpile was so depleted of silver that if the American Silver Eagle bullion sales program was to continue further legislation was required.
On June 6, 2002, Senator Harry Reid (D-Nevada) introduced the Support of American Eagle Silver Bullion Program Act to “authorize the Secretary of the Treasury to purchase silver on the open market when the silver stockpile is depleted.”
2002 – 10,539,026 Bullion American Silver Eagles were sold.
2003 – 8,495,008 Bullion American Silver Eagles were sold, silver averaged $4.88 an ounce for the year.
2004 – 8,882,754 Bullion American Silver Eagles were sold. For 2004 the average cost of an ounce of silver was $6.67.
2005 – 8,891,025 Bullion American Silver Eagles were sold. Silver averaged $7.32 an ounce.
2006 – 10,676,522 Bullion American Silver Eagles were sold. Silver averaged $11.55 an ounce.
2007 – 9,028,036 Bullion American Silver Eagles were sold.
2008 – 20,583,000 Bullion American Silver Eagles were sold. Silver averaged $14.99 an ounce and almost 80% more Bullion American Silver Eagles were sold then in any previous year.
The US Mint suspended sales of the silver bullion coins to its network of authorized purchasers twice during the year.
In March 2008, sales increased nine times over the month before – 200,000 to 1,855,000.
In April 2008, the United States Mint had to start an allocation program, effectively rationing Silver Eagle bullion coins to authorized dealers on a weekly basis due to “unprecedented demand.”
On June 6, 2008, the Mint announced that all incoming silver planchets were being used to produce only bullion issues of the Silver Eagle and not proof or uncirculated collectible issues.
The 2008 Proof Silver Eagle became unavailable for purchase from the United States Mint in August 2008.
2009 – 30,459,000 Bullion American Silver Eagles were sold
On March 5, 2009, the United States Mint announced that the proof and uncirculated versions of the Silver Eagle coin for that year were temporarily suspended due to continuing high demand for the bullion version.
On October 6, 2009, the Mint announced that the collectible versions of the Silver Eagle coin would not be produced for 2009.
The sale of 2009 Silver Eagle bullion coins was suspended from November 24 to December 6 and the allocation program was re-instituted on December 7.
Silver Eagle bullion coins sold out on January 12, 2010.
The average cost of an ounce of silver in 2009 was $14.67
2010
No proof Silver Eagles were released through the first ten months of the year, and there was a complete cancellation of the uncirculated Silver Eagles.
Production of the 2010 Silver Eagle bullion coins began in January instead of December as usual. The coins were distributed to authorized dealers under an allocation program until September 3.
In 2010 the US Mint sold 34,700,000 Bullion American Silver Eagle Coins.
2011
According to the USGS’s most recent Silver Mineral Industry Survey, silver production fell to 37 tonnes in October – compared to 53 tonnes year over year (yoy).
In 2011, the United States produced approximately 1,054 tonnes of silver – down from 2010’s production of 1,154 tonnes and down from 2007’s production of 1,163 tonnes.
The US imported 6,600,000 oz of silver for consumption in 2011 – up from 2007’s imports of 4,830,000 oz.
In 2011 the US Mint sold 39,868,500 Bullion American Silver Eagle Coins.
2011 was the first year in which official coin sales will surpass domestic silver production.
Jeff Clark of Casey Research writes “For the first time in history, sales of silver Eagle and Maple Leaf coins surpassed domestic production in both the US and Canada. Throw in the fact that by most estimates less than 5% of the US population owns any gold or silver and you can see how precarious the situation is. A supply squeeze is not out of the question – rather it is coming to look more and more likely with each passing month.”
The US Mint is required by law to mint the bullion Silver Eagles to meet public demand for precious metal coins as an investment option. The numismatic versions of the coin (proof and uncirculated) were added by the Mint solely for collectors.
2012
United States Mint Authorized Purchasers (AP’s) ordered 3,197,000 Bullion American Silver Eagle Coins on January 3rd, the first day they went on sale. That opening day total catapulted January Bullion Eagle sales higher than half of the monthly totals in 2011.
As of January 25th 2012, 5,547,000 Bullion American Silver Eagle Coins had been sold.
Bullion Silver Eagles are guaranteed for weight and purity by the government of the United States and because of this the US government allows bullion Silver Eagles to be added to Individual Retirement Accounts (IRAs).
Conclusion
The twin policies of zero interest rates and the continual creation of money and credit being enacted today, by all governments and central banks, means that the purchase of precious metals is the only way to protect the value of your assets.
“Mark my words, if the interest rates on U.S. government debt truly reflected both the real level of inflation in this country and the rising risk of some form of default, rates would already by sky-high and the U.S. would resemble a massive Greece.” John Embry, Chief Investment Strategist, Sprott Asset Management
Investors are currently risk adverse and mining stocks are not well understood by the general investing public, but at least one thing is going to become very apparent to most – the best way to hedge yourself against inflation could be owning silver.
Junior resource companies offer the greatest leverage to increasing demand and rising prices for silver. Junior resource companies are soon going to have their turn under the investment spotlight and should be on every investors radar screen. Are they on yours?
If not, maybe they should be.
*Post courtesy of Richard Mills at Aheadoftheherd.com where he covers the junior resource sector.
Will the Federal Reserve Devalue the Dollar?
The news around the world has been rather interesting over the last few weeks. We have Iran trading Oil for Gold instead of PetroDollars. The Greek crisis still has not been solved while Italy, Spain and Portugal are struggling to stay solvent. China has signed fourteen currency swap agreements bypassing the US Dollar. The Federal Reserve has announced that it will keep interest rates at or near zero until 2014. The US has just raised its debt limit once again, with little opposition. We all know that 2012 is an election year in the USA which usually means very little will be done in Washington.
So what will we see this year? Will we see Deflation or Inflation? Currently I hear news out of the USA and here locally in Panama that items are going up in price. I just spent a week in San Jose, Costa Rica where one liter of Coca Cola was $2.50. They were just forced here in Panama to raise the minimum wage to $500 just so people could afford to survive. You can imagine the repercussions, many businesses will have to let employees go in order to keep the doors open. Here in Panama we use the US Dollar as our currency. Who is to blame for the inflation we are seeing? It is not the printing presses fault. It is the powers behind the printing.
Way back on November 21, 2002 there was a Federal Reserve Governor named Ben Bernanke, who gave a speech to the National Economist´s Club. In this speech he outlined exactly what he would do if he was Chairman of the Federal Reserve in the instance of a financial crisis or Depression.
- The Federal Reserve would lower the interest rate to zero
- Purchase Securities from Banks (GM, Chrysler)
- Increase the Money Supply
- Buy Countries Debt QE1, QE2, QE3 and QE Infinity
- Devalue the Dollar
I will not go into each of these scenarios individually. We all know that points one through four are already in play. The one that has not occurred yet is the devaluation of the Dollar. Mr. Bernanke calls himself a student of the depression. He has studied The Federal Reserve actions during that time. Here is an excerpt from that speech.
Ben Bernanke November 21, 2002
Although a policy of intervening to affect the exchange value of the dollar is nowhere on the horizon today, it´s worth noting that there have been times when exchange rate policy has been an effective weapon against deflation. A striking example from U.S. history is Franklin Roosevelt´s 40 percent devaluation of the dollar against Gold in 1933-34, enforced by a program of Gold purchases and domestic money creation. The devaluation and the rapid increase in money supply it permitted ended the U.S. deflation remarkably quickly. Indeed, consumer price inflation in the United States, year on year, went from -10.3 percent in 1932 to -5.1 percent in 1933 to 3.4 percent in 1934. The economy grew strongly, and by the way, 1934 was one of the best years of the century for the stock market. If nothing else, the episode illustrates that monetary actions can have powerful effects on the economy, even when the nominal interest rate is at or near zero, as was the case at the time of Roosevelt´s devaluation.
Original speech can be viewed here
On April 3rd 1933 President Roosevelt declared the Presidential Order 6102.
All persons are hereby required to deliver on or before May 1, 1933, to a Federal Reserve bank or a branch or agency thereof or to any member bank of the Federal Reserve System all gold coin, gold bullion, and gold certificates now owned by them or coming into their ownership on or before April 28, 1933.
At this time Gold was valued at $20 per ounce. Shortly after the Gold confiscation was completed the Federal Reserve revalued Gold at $35 per ounce or a 40 percent devaluation of the currency. Remember that during this time the Dollar was backed by the promise of Gold.
In my mind Mr. Bernanke is telling us what he is going to do next if the economy does not respond to the other four measures that he has implemented. What would a 40% devaluation of the US Dollar do to your savings if everything is in US Dollars or a currency pegged to the Dollar? The devaluation of the US Dollar would be great for Gold, Silver, Home Values, Debt and the stock market. What about the people that do not have hard assets? People who live off Social Security, Government Subsidies, Fixed Incomes and Savings will have a difficult time. Imagine tomorrow you wake up and your savings has just been devalued 40%.
Growing up I was taught that putting your savings in the bank was important. Today it seems that the idea is no longer valid. What Mr. Bernanke has told us is that he will devalue the currency in order for the country to continue to have growth. What are you doing to protect your family and future?
By: Randy Hilarski – The Rare Metals Guy
States seek currencies made of silver and gold
Gold American Eagle Coins
NEW YORK (CNNMoney) — A growing number of states are seeking shiny new currencies made of silver and gold.
Worried that the Federal Reserve and the U.S. dollar are on the brink of collapse, lawmakers from 13 states, including Minnesota, Tennessee, Iowa, South Carolina and Georgia, are seeking approval from their state governments to either issue their own alternative currency or explore it as an option. Just three years ago, only three states had similar proposals in place.
“In the event of hyperinflation, depression, or other economic calamity related to the breakdown of the Federal Reserve System … the State’s governmental finances and private economy will be thrown into chaos,” said North Carolina Republican Representative Glen Bradley in a currency bill he introduced last year.
Unlike individual communities, which are allowed to create their own currency — as long as it is easily distinguishable from U.S. dollars — the Constitution bans states from printing their own paper money or issuing their own currency. But it allows the states to make “gold and silver Coin a Tender in Payment of Debts.”
To the state legislators who are proposing state-issued currencies, that means gold and silver are fair game, said Edwin Vieira, an alternative currency proponent and attorney specializing in Constitutional law. And since gold has grown exponentially more valuable, while the U.S. dollar continues to lose ground, the notion has become increasingly appealing to state lawmakers, he said.
The state gold rush: Utah became the first state to introduce its own alternative currency when Governor Gary Herbert signed a bill into law last March that recognized gold and silver coins issued by the U.S. Mint as an acceptable form of payment. Under the law, the coins — which include American Gold and Silver Eagles — are treated the same as U.S. dollars for tax purposes, eliminating capital gains taxes.
Since the face value of some U.S.-minted gold and silver coins — like the one-ounce, $50 American Gold Eagle coin — is so much less than the metal value (one ounce of gold is now worth more than $1,700), the new law allows the coins to be exchanged at their market value, based on weight and fineness.
Local currencies: In the U.S., we don’t trust
“A Utah citizen, for example, could contract with another to sell his car for 10 one-ounce gold coins (approximately $17,000), or an independent contractor could arrange to be compensated in gold coins,” said Rich Danker, a project director at the American Principles Project, a conservative public policy group in Washington, D.C.
South Carolina Republican Representative Mike Pitts proposed a currency system that would allow people to use any kind of silver or gold coin — whether it’s a Philippine Peso or a South African Krugerrand — based on weight and fineness. Pitts said in the bill, which currently has 12 co-sponsors, that the state is facing “an economic crisis of severe magnitude.”
Republican representatives from Washington State followed suit in January, introducing a bill that would also allow any gold and silver coins to be considered legal tender based on metal values. Minnesota, Iowa, Georgia, Idaho and Indiana are also considering similar proposals.
Many of the bills would make it possible for residents to exchange the physical coins for goods and services, so you could use coins to buy anything from groceries to a car as long as the store chooses to accept them.
However, most people aren’t going to walk around with such valuable coins in their pockets, said Vieira. Plus, calculating the value of the coins — especially if they come from different parts of the globe and are of different sizes and shapes — will get tricky.
Community cash: In each other we trust
It’s more likely that the states will create electronic depositories and accounts for the coins to make transactions easier, when and if the initial bills are passed, he said.
Utah Gold & Silver Depository is already developing a system where customers could use debit cards linked to their gold holdings. When customers swipe their debit cards to make transactions, physical gold and silver coins would be transferred between accounts in privately-owned depositories (or vaults) based on the market value of the metals.
Before deciding on a specific form of currency, some states — including Minnesota, Tennessee, Virginia and North Carolina — are considering proposals that would first require a committee to review their alternative currency plan.
The future of U.S. currency: The states’ proposals have been gaining steam among Tea Partyers and Republicans, many of whom also endorse a nationwide return to the gold standard, which would require the U.S. dollar to be backed by gold reserves.
Tea Party “father” Ron Paul is sponsoring the “Free Competition in Currency Act,” which would allow states to introduce their own currencies, and rival Newt Gingrich is calling for a commission to look at how the country can get back to the gold standard.
But it will be the individual states that could really get the ball rolling, said Vieira. Even if several of the current proposals get killed, the introduction of so many bills at the state level is drawing national attention to the issue, he said.
Funny money: 11 local currencies
Of all the state proposals circulating right now, Republican-controlled states including South Carolina, Georgia, Idaho and Indiana have the best chance of passing their proposed bills this year, said American Principles Project’s Danker. If just one or two states implement an alternative currency, it could have a Domino effect, he said.
“I think we could get a couple passed in this legislative session, and that would show this is mainstream, popular and it would be a justification for more of the risk-averse states for doing this,” he said.
There are, of course, many people who think the recent push for alternative state currencies should be stopped in its tracks. David Parsley, a professor of economics and finance at Vanderbilt University, said he thinks state-issued currencies are a “terrible” idea.
“Having 50 Feds” could debase the U.S. dollar and even potentially lead the country into default, he said. “The single currency in the United States is working just fine,” said Parsley. “I have no idea why anyone would want to destroy something so successful — unless they actually wanted to destroy the country.”
By Blake Ellis @CNNMoney
Source: http://money.cnn.com/2012/02/03/pf/states_currencies/
Weekly Google Plus 52 Silver 1 ounce Coins or Bars Giveaway
It is 2012 and we are giving away 52 Silver 1 ounce Coins or Bars. Swiss Metal Assets is committed to bringing you the latest information on the Precious Metals and Rare Industrial Metals market.
Silver is a store of value and one of the critical metals according to the United States Geological Survey and the British Geological Survey. Silver is so important to the world around us that we think that a weekly giveaway is in order.
Giveaway rules:
- Please Follow Swiss Metal Assets on Google Plus by adding us to your circles
- Please reshare the post you saw this Giveaway on in your Google Plus stream.
- As a comment please guess the closing price of Silver by Thursday at 1pm for the Comex Silver closing price on Fridays at 6pm.
- You can also help us out by giving us a +1 on our website, not required but we sure wouldn´t mind.
This is an international competition so everyone can try to guess the price weekly. We are a German company based in Panama and we welcome everyone.
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- Is Offshore Investing Legal With an IRA
- How to “Split Up” Business Property as an Asset Protection Strategy
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