Buy Silver Bullion Coins

Gold hit $1600 in London this morning and silver $40, although both fell back thereafter. But the barrier has been breached which would seem to be paving the way for further rises ahead.

Lawrence Williams
July 18, 2011
www.mineweb.com

LONDON
Gold cracked the $1600 barrier, albeit briefly initially, this morning in London, while silver moved back up through the $40 mark as the safe haven aspects of the precious metals began to take hold once more on perhaps the increased understanding by the whole investment community of the global economic perils ahead. Whether this $1600 level can be returned to, and increased, through the day - and in the U.S. - obviously remains to be seen, but the fact remains that a psychological barrier has been overcome. Past patterns suggest that the metals may trade at close to this level and either make a substantial breakthrough, or consolidate at just below.
Silver back through $40, and the further small fall in the gold:silver ratio (GSR) to a fraction below 40:1 does seem to be a further indication that investor interest in this metal is again coming to the fore with the April fall-off quickly being forgotten. But silver's reputation as the ‘devil's metal' as far as investment is concerned should act as a cautionary warning, but as long as gold stays strong silver downside is small. But if gold should see even a temporary fallback then the corresponding drop in silver could be sharp.
Silver's proponents point to the increasing uses of the metal in such spheres as biocides and water purification as being a major positive factor, but it is both speculative and safe haven investment that is the driving force here - industrial usage is currently only a minor part of the silver equation. As Rhona O'Connell points out in today's article on Mineweb - see Comex silver longs bound higher - but much of it is short covering extraneous technical commodity market factors may well be distorting the picture here as well.
The European debt crisis is definitely not going to go away and if one of the more vulnerable European economies is actually allowed to default (and one does not see how some kind of default can be avoided for Greece) then the knock-on effects on the other crisis hit countries and the banking system as a whole, could be dire. The emergency funding for Greece that was recently agreed appears only to be sufficient to postpone the inevitable and we could be looking to an autumn of ever escalating financial meltdown. If Greece defaults then one finds it difficult to conceive that Ireland and Portugal would not follow suit almost immediately, and then the pressures on the much more significant economies of Italy and Spain would be close to overwhelming. European banks would crash like ninepins and with the interconnections within the global banking system many non-European banks would collapse as well.
There is a sideshow in the U.S. at the moment too which is helping gold as Democrats and Republicans are playing a game of brinkmanship over the U.S. debt ceiling. If agreement can not be reached on raising the ceiling, and failing a Presidential bending of the rules, the U.S. itself could go into technical default in two weeks' time and the psychological financial repercussions of this could also be enormous. One suspects that a compromise will be reached at the 11th hour, but if intransigence on the part of the parties involved means that this drags on beyond the deadline then the effects on the financial system could be worse than the Lehman Brothers collapse.
Governments and central bankers are aware of the perils ahead and one suspects that they will somehow manufacture a solution that will ward off the seemingly inevitable, although whether they can do so to the satisfaction of the credit ratings agencies remains to be seen. Ratings downgrades lead to higher interest rates being applied and at current debt levels the amounts involved in resultant increased payments just make the likelihood of pulling out of the downward spiral almost impossible.
These are difficult - indeed exceedingly dangerous - times for the global economy and whether or not the politicians and central bankers can bring us back from the brink has to be questionable. In such times of uncertainty gold is likely to maintain its historical pattern of being the investment choice to preserve wealth, however anomalous this may seem in this day and age, and silver will likely follow suit on gold's back.

Michael T. Snyder
July 7, 2011
www.seekingalpha.com

In the past, there certainly have been governments that have gotten into trouble with debt, but what we are experiencing now is the first truly global sovereign debt crisis. There has never been a time in recorded history when virtually all of the governments of the world were drowning in debt all at the same time. This sovereign debt crisis is never going to end until there is a major global financial collapse. There simply is no way to unwind the colossal web of debt that we have constructed in an orderly fashion.

Right now, the EU and the IMF have been making "emergency loans" to nations such as Greece, Ireland and Portugal, but that is only going to buy those countries a few additional months. Giving more loans to nations that are already drowning in red ink may "kick the can down the road" for a little while, but it isn't going to solve anything. Meanwhile, dozens more nations all over the globe are rapidly approaching a day of reckoning.

All of the bailouts that you are hearing about right now are simply delaying the pain. The reality is that when the "emergency loans" for Greece stop, Greece is going to default. Greece is toast; the game is over. You can stick a fork in Greece because it is done.

One of the big problems for Greece is that since it is part of the euro, it can't independently print more money. If Greece cannot raise enough euros internally, it must turn to outside assistance. Unfortunately, at this point Greece has accumulated such a mammoth debt that it cannot possibly sustain it. By the end of the year, it is projected that the national debt of Greece will soar to approximately 166% of GDP.

The financial collapse of Greece is inevitable. If it keeps using the euro -- or even if it quits using it -- it will collapse. When the rest of Europe decides that it is tired of propping Greece up, the game will be over. And at this point, very few people are interested in lending Greece more money.

As I wrote yesterday, many of the nations around the world are only able to keep going because they are able to borrow huge amounts of money at low interest rates. Well, nobody wants to lend money to Greece at a low rate of interest anymore.

Today, the yield on two-year Greek bonds is back over 28 percent. Fortunately for the rest of the world, Greece is just a very, very small part of the global economy, but when interest rates start spiking like that on U.S. or Japanese debt, the entire world's financial system will be thrown into chaos.

So why is there so much of a focus on Greece right now? There is a real danger that the panic will start to spread. The other day, Moody's Investors Service slashed the credit rating on Portuguese government debt by four notches; that debt is now considered to be "junk." But even more alarming is that Moody's stated that what is going on in Greece played a role in reducing the credit rating of Portugal.

The following is a portion of what Moody's had to say when it cut the credit rating of Portugal by four notches:

Although Portugal’s Ba2 rating indicates a much lower risk of restructuring than Greece’s Caa1 rating, the EU’s evolving approach to providing official support is an important factor for Portugal because it implies a rising risk that private sector participation could become a precondition for additional rounds of official lending to Portugal in the future as well. This development is significant not only because it increases the economic risks facing current investors, but also because it may discourage new private sector lending going forward and reduce the likelihood that Portugal will soon be able to regain market access on sustainable terms.

Basically, Moody's is saying that the terms of the Greek bailout make Portuguese debt less attractive because Portugal will likely be forced into a similar bailout at some point. If the EU is not going to fully guarantee the debt of the member nations, then that debt becomes less attractive to investors.

The downgrade of Portugal is having all kinds of consequences. The cost of insuring Portuguese government debt set a new record high on Wednesday, and yields on Portuguese bonds have gone haywire. If you want to get an idea of just how badly Portuguese bonds have been crashing, just check out this chart.

But it is not just Portugal that is having problems. Just recently, Moody's warned that it may downgrade Italy's Aa2 debt rating at some point within the next few months. Spain is also on the verge of major problems and Ireland may need another bailout soon.

Things don't look good. Unfortunately, if the dominoes start to fall the entire EU is going to go down. Big banks all over Europe are highly exposed to sovereign debt and they are leveraged to the hilt. It is almost as if we are looking at a replay of 2008 in many ways.

When Lehman Brothers finally collapsed, it was leveraged 31 to 1. Today, major German banks are leveraged 32 to 1, and major German banks are currently holding a tremendous amount of Greek debt. Anyone with half a brain can see that this is going to end badly.

So how is the European Central Bank responding to this crisis? It's raising interest rates once again. That certainly is not going to help the PIIGS much. But Europe is not the only one facing a horrific debt crunch.
In Japan, the national debt is now up to about 226 percent of GDP. So far the Japanese government has been able to handle a debt load this massive because the citizens of Japan have been willing to lend the government gigantic mountains of money at interest rates so low that they are hard to believe. When that paradigm changes, and it will, Japan is going to be in a massive amount of trouble. In fact, an article in Forbes has warned that even a very modest increase in interest rates would cause interest payments on Japanese government debt to exceed total government revenue by the year 2019.

Of course, the biggest pile of debt sitting out there is the national debt of the United States. The U.S. is so enslaved to debt that there is literally no way out under the current system. To say that America is in big trouble would be a massive understatement.

In fact, the whole world is headed for trouble. Right now, government debt around the globe continues to soar at an exponential pace. At some point a wall is going to be hit.

The Wall Street Journal recently quoted Professor Carmen Reinhart as saying the following about what we are facing:
"These processes are not linear," warns Prof. Reinhart. "You can increase debt for a while and nothing happens. Then you hit the wall, and -- bang! -- what seem to be minor shocks that the markets would shrug off in other circumstances suddenly become big."

That is the nature of debt bubbles; They keep expanding and expanding until the day that they inevitably burst.

Governments around the world will issue somewhere in the neighborhood of $5 trillion more debt this year alone. Debt to GDP ratios all over the globe continue to rise at a frightening pace. Because the world is so interconnected today, the collapse of even one nation will devastate banks all over the planet. If even one domino is toppled, there is no telling where things may end.

The combination of huge amounts of debt and huge amounts of leverage is incredibly toxic, and that is what we have all over the globe today. Almost every major nation is drowning in a sea of red ink and almost all of our major financial institutions are leveraged to the hilt.

There is only one way that the sovereign debt crisis can end: Very, very badly. I hope you are ready for what is coming.

James Turk
May 31, 2011
goldmoney.com

Silver is the volatile precious metal. For example, a few weeks before the collapse of Lehman Brothers in September 2008, it took 51 ounces of silver to buy one ounce of gold. At the height of the market turmoil one month later, it took 84 ounces of silver to buy that same ounce. What makes silver so volatile? The demand for silver is "elastic" -- to put it into economic terms -- while the demand for gold is "inelastic".

When demand is elastic, it means that people's preferences are changeable. An inelastic demand means that the item will be acquired regardless of its cost. As an example, the rising price of petrol and diesel fuel in recent years has hardly reduced the demand for it. Fuel consumption has not dropped as its price has risen. People are generally not price-sensitive, at least at present prices, though the demand for fuel may become more elastic at higher prices.

When problems of national currencies increase the demand for gold, it is in fact an increase in the demand for precious-metal-money. Silver of course meets this requirement, as it is a precious metal, and like gold, it too is money. Functionally, silver is a good substitute for gold. Both are tangible assets, and both are money that does not have counterparty risk.

Thus, any increase in the demand for precious-metal-money impacts both gold and silver. However, this increase in demand has a bigger impact on silver because of its elastic demand.
Demand is impossible to measure, but we can see the changes in respective demand for the precious metals by movements in the gold/silver ratio. Movements up and down in this ratio clearly show the ebb and flow of demand between gold and silver.
When people move out of national currencies and into precious-metal-money, money moves into both gold and silver, and the gold/silver ratio falls. Eventually, this flow reverses if people's confidence in national currencies returns. It does so when the monetary problems that caused them to flee the currency in the first place (for example, rising inflation, bank crises, or other problems) are solved. The impact on silver is greater than the impact on gold because the demand for silver is more elastic than the demand for gold, so the ratio rises.
While I am very bullish on the long-term prospects for gold, I am even more bullish on silver. Historically, the ratio of these two precious metals is about 16-to-1. Therefore, as both gold and silver climb higher in this current bull market as a safe haven from national currency problems, I expect silver to climb even faster than gold, with the result that the gold/silver ratio eventually approaches 16-to-1.

A big attendance at this year's New York Hard Assets event has the chance to listen to a number of eminent specialist commentators, with gold and silver dominating.

Lawrence Williams
May 10, 2011
www.mineweb.com

NEW YORK
Speaking to a packed audience (standing room only) at The New York Hard Assets Conference yesterday, Eric Sprott reiterated his well-known views on gold and silver the former he called the investment of the decade and the latter the investment of the next decade. Sprott was among the Keynote speakers at this year's event which attracted potential investors looking to learn more about investment in commodities and mining companies (mostly junior miners), with the featured speakers being big attractions for the audience.

Like most of the other keynotes, the Sprott's comments covered what virtually all the precious metals bulls see as the key drivers of the markets, namely the U.S deficit, excess printing of money by most major economies, the political unrest in the Middle East, North Africa and elsewhere, the depreciation of the dollar, accelerating global inflation, fear of debt defaults, the growth of wealth and investment in gold and silver in Asia etc. Indeed fellow keynote speaker Jeff Nichols came up with 11 such factors driving up prices. All the main speakers viewed the recent heavy downturns in commodities prices as being a blip in an ongoing upwards path.

While most of the speakers point to the money supply situation in the West as being the root cause of likely future inflation in both Western and Eastern economies, Martin Murenbeeld, one of today's keynote speakers, told Mineweb that China too has been stimulating - perhaps overstimulating - its economy in a similar way and blaming current Chinese inflation on the U.S. Fed is rubbish.

Coming back to Eric Sprott - he raised the specter of market manipulation so beloved of many of the precious metals bulls, pointing to silver falling $6 in 13 minutes on Monday in an extremely thin market when some key market players like China and the UK had public holidays. Coupled with the raising of margin requirements on COMEX, he saw this as a major effort by some of those with huge silver short positions to mitigate some of their losses. "If this doesn't show market manipulation I don't know what does" said Sprott.

Jay Taylor, speaking earlier in the day also raised the specter of the U.S. economy and its lack of growth, even though some official statistics may suggest it is beginning improve. "Think about what's really going on" he opined, "Not what the establishment wants you to think is going on!" Taylor puts total debt at $57 trillion if you take into account not only Federal debt, but state and municipal debt, credit cards etc. He reckons U.S. government policy is failing as in the 1930s when there were years of depression, high unemployment etc. He too pointed to the real price of gold rising in what has been the bull market of a lifetime.

Overall the Hard Assets conference organizers have done a pretty good job in pulling in a number of very well-known names in the precious metals and economic sectors to boost the audiences in the hope that many will stay in the auditorium area and listen to the junior miners and explorers presenting their projects - a number of whom have some very interesting stories to tell anyway. The difficulty for the investor, as always, is picking the wheat from the chaff. In a precious metals bull market junior companies can provide huge returns when they are successful - but then most aren't! Caveat emptor.

Gold and silver have both made something of a recovery after their sharp falls last week - the question is whether this can be sustained in the short term or whether we are due another fall.

Lawrence Williams
May 9, 2011
www.mineweb.com

NEW YORK
In a sign that much of the market feels that perhaps the sharp fall-off in the gold price - and also that of silver in particular - may have been overdone, the prices picked up a little on Friday to well above their low points, and carried on moving upwards Monday morning in Asian and European trade. Gold moved back above the psychological $1500 level, while silver rose by a bigger percentage- as might be expected following its huge fall in percentage terms - to back over $37.

As we have pointed out before here, virtually all the politico-economic factors which have moved the gold price higher and higher remain just as strongly in place - if not more so given the seeming escalation of the financial crisis in Greece, while one has a strong feeling that defaults in U.S. cities and States are not far away now, which could give another boost to the upwards spiral.

Despite the Eurozone problems, the U.S. dollar still looks weak against other major currencies as other Central Banks are seen as more likely to raise interest rates than the U.S. and some of the recovery so far today has been due to the dollar resuming a downwards path after a very minor recovery last week. Mexico's gold purchases in February and March (we don't know yet if the country continued purchases in April) should help underpin the price revival - while Asian buying seems to be continuing apace.

As to where the gold and silver prices go from here in the short term this is largely dependent on the U.S. market today to either confirm the rally or put an end to it. Ultimately though gold does look poised to continue rising, even though it can show weakness in the summer months - a view taken even by many among the more objective analytical community.
Silver is a bit more of a conundrum and will definitely remain much more volatile. There are hugely conflicting views on silver supply. The tendency has been for silver to rise faster than gold when the latter is on the up, and crash much faster and farther when gold falters. One has to doubt whether the gold:silver ratio will quickly get back to the low 30s given the number of speculators who have had their fingers burnt in the past week's dramatic fall. It is currently at 40 at the time of writing.

Jeff Berwich
April 27, 2011
www.resourceinvestor.com

If you keep your money or savings in US dollars inside of the United States, you are a risk taker of epic proportions. Have you not been paying attention to what is going on?

To begin with, the US government now employs cash-sniffing dogs at most international airports. If you are carrying more than $10,000 in cash and don't declare it to the government when coming in or out of the US, your cash will be seized. Thanks to these cash-sniffing canines, US customs officials seized $3.2 million at Boston's Logan Airport last year.
Some government apologists might say, "If you aren't doing anything wrong, why would you mind being x-rayed, sniffed, patted down, detained and questioned?"

Besides the obvious absurdity of that question, the main reason this is of concern is because in every case in history when a government has inflated its currency into worthlessness they always institute capital controls. Just ask anyone from Argentina or Italy. And it won't take much to change the rules from having to "declare" $10,000 to "not being allowed" to take $10,000 out of the country.

Not to mention that if you do declare you are taking $10,000 out of the country, who knows what kind of database you will end up on. You are obviously highly suspicious if you have more than a few hundred bucks! Only Wall Street bankers and others associated with the government are supposed to have more than a couple dollars! The most ludicrous example of the War on Money came across the newswire recently, "Feds Seek $7 million in Privately Made Liberty Dollars." The news story is only about 10 paragraphs long yet it has dozens of logical absurdities. Even in the headline is one. According to the headline, part of the reason they want to seize these dollars is because they are "privately made." Yes, we wouldn't want to compete with the private Federal Reserve banking cartel.

And I know the Constitution is passé in the US, nowadays, but how in the world can this man be in trouble for making silver coins? The constitution states:

"No state shall enter into any treaty, alliance, or confederation; grant letters of marque and reprisal; coin money; emit bills of credit; make anything but gold and silver coin a tender in payment of debts."

He is in trouble because he is making currency out of gold or silver yet, the Federal Reserve, another private organization, is not doing anything wrong by making paper currency not backed by gold and silver coin?
Apparently, the thing they "got him on" was the following:

Federal prosecutors successfully argued that he was, in fact, trying to pass off the silver coins as US currency. Coming in denominations of 5, 10, 20 and 50, the Liberty Dollars also featured a dollar sign, the word "dollar" and the motto "Trust in God," similar to the "In God We Trust" that appears on US coins.

Ignoring the fact that the dollar sign was originally used for Spanish and Mexican pesos and was stolen by the US to use for its dollars and the fact that the word dollar actually comes from the word thaler which was a silver coin minted in Bohemia, according to the Feds he was trying to pass off coins, made of silver, worth more than $35/ounce, as quarters, which are now made from 92% copper and 8% nickel, and worth $0.06 in metal value.

Boy, that's quite the racket! Passing off highly valuable silver to people who were expecting to receive near-worthless copper and nickel tokens! It's a good thing they stopped him before it was too late!
Anne Tompkins, the US Attorney who was put on this important case, stated:

"Attempts to undermine the legitimate currency of this country are simply a unique form of domestic terrorism."

Anne, if attempting to undermine the currency of the US is a form of terrorism, why has Ben Bernanke not been tracked down and sent off to the Guantanamo concentration camp?

This "news" story finished by quoting an unbiased source: a group named the Southern Poverty Law Center, a group that tracks political extremism which has apparently been tracking Bernard von NotHaus, the proprietor of the silver coin making terror enterprise. According to the story, long before the government began its investigation into von NotHaus, the group was raising concerns about the popularity of Liberty Dollars among fringe groups on the far right.

"He's playing on a core idea of the radical right, that evil bankers in the Federal Reserve are ripping you off by controlling the money supply," said Mark Potok, spokesman for the group. "He very much exists in the world of the anti-government patriot movement, whatever he may say. That's who his customers are."

The US has started another war. The war on money. Anyone with any amount of cash more that will buy them a couple NFL tickets and beers for the game is suspect. And if you are one of those deluded people who thinks the Federal Reserve is evil and is ripping you off and you buy gold or silver to protect yourself, you are a domestic terrorist.

It's going to be a fun few years ahead in the US. [BH note: it will NOT be fun, exciting but NOT fun.]

Jeff Berwick, a self-described financial freedom fighter, is the founder of Canada's largest financial website, Stockhouse.com. He now writes the libertarian, Austrian-economics based newsletter, The Dollar Vigilante and is a regular speaker at many of the world's most important investment, resource and freedom-focused conferences where he is known as the most dangerous man in finance. He will speak at the New York Hard Assets Investment Conference on "Survive & Prosper During the Collapse of the US" on Monday, May 19.

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Silver futures surged today to a new 31-year high of $42.80 per ounce. Silver is up 146% since NIA declared silver the best investment for the next decade on December 11th, 2009, at $17.40 per ounce. All we need is for silver to rise by another 15.5% and silver will reach its all time high set in 1980 of $49.45 per ounce.
 
Keep in mind, silver's high of $49.45 per ounce in 1980 would equal about $140 per ounce in today's dollars adjusted to the consumer price index and about $400 per ounce in today's dollars adjusted to the real rate of price inflation. Despite silver's huge gains in recent months, we have yet to see silver rise by $2 or more in a single day. When we start to see a true "silver mania" with investors around the world rushing out of their U.S. dollars and panic buying silver, we expect to see silver gain by $5 to $10 in a single day on more than one occasion.
 
Back in February of last year when silver dipped to below $15 per ounce, we sent out an alert saying, "NIA believes this is a once in a lifetime entry point for those wishing to go long silver at a bargain basement price". NIA suggested silver call options in February of last year that ended up gaining over 1,000%. NIA's latest silver stock suggestion is currently up 175% from our profile price.
 
In NIA's top 10 predictions for 2010, we predicted a major decline in the gold/silver ratio, which was 64 at the time. The gold/silver ratio declined in 2010 down to 46, and in our top 10 predictions for 2011, we predicted another major decline in the gold/silver ratio and projected for it to decline this year to 38. NIA has been the most bullish organization in the world on silver, yet recent gains in the price of silver have surpassed even our short-term expectations. The gold/silver ratio is now down to 35 and we believe it will decline to at least 16 this decade, and possibly as low as 10.
 
The artificially high gold/silver ratio of the past century will be looked back at as an anomaly caused by the silver price suppression scheme of the Federal Reserve, which was in cahoots with Bear Stearns and now JP Morgan. NIA's President Gerard Adams exposed this scheme in NIA's critically acclaimed documentary 'Meltup', which has now been viewed by over 1 million people with an overwhelming 96% of its viewers giving it a thumbs up, a world record for an economic documentary. According to Mr. Adams, the Federal Reserve chose to bail out Bear Stearns and not Lehman Brothers, because Bear Stearns was the holder of a massive naked short position in silver that they were on the verge of being forced to cover.
 
It is not a coincidence that Bear Stearns failed on the very day silver reached its then multi-decade high of $21 per ounce. Bear Stearns was on the verge of being forced to cover their naked short position, which could have sent silver from $21 per ounce to $50 per ounce overnight. By bailing out Bear Stearns and allowing JP Morgan to acquire Bear Stearns' assets with the promise to cover any losses derived from them, JP Morgan was able to continue managing the silver short position and orchestrate a manipulative take down in 2008 from $21 per ounce down to $8 per ounce.

 
Only ten times more silver has been produced in world history than gold and from the years 1000 to 1873, a period of 873 years, the gold/silver ratio remained between 10 and 16. In fact, the Coinage Act of 1834 defined a gold/silver ratio of 16. The gold/silver ratio started to rise after silver was demonetized in 1873. Despite silver being demonetized, we saw the gold/silver ratio return to 16 on three occasions during the past century: in 1919, 1968, and 1980.
 
It was only ten months ago in June of 2010 that the gold/silver ratio was 70. With the gold/silver ratio now at 35, it means that silver investors have seen their purchasing power double over the past ten months, while those with their savings in U.S. dollars have seen their purchasing power decline by 20%. That's right, forget about NIA's silver call option that gained over 1,000% and forget about NIA's most recent silver stock suggestion that is currently up 175%; the simple act of following NIA's most basic suggestion of getting rid of your U.S. dollars and buying physical silver means that over the past ten months, your purchasing power has doubled while non-NIA members with U.S. dollars lost 1/5 of their real wealth.
 
The Federal Reserve can claim all they want that there is no inflation, but as we write this article we are eating Ben & Jerry's ice cream that we just bought at Quick Chek for $5 a pint. Three years ago, the same pint of Ben & Jerry's ice cream at Quick Chek cost us $3. Three years ago, one ounce of gold would have bought 295 pints of Ben & Jerry's ice cream and it still buys 295 pints of Ben & Jerry's ice cream today. Three years ago, one ounce of silver would have bought 5.7 pints of Ben & Jerry's ice cream and today it buys 8.5 pints of Ben & Jerry's ice cream.
 
Americans with their savings in U.S. dollars can today only afford 3/5ths of the ice cream that they could have bought three years ago, but those with their savings in gold have maintained their purchasing power, and those with their savings in silver have greatly increased their purchasing power. NIA is 100% sure that the gold/silver ratio will decline to at least 16 within the next few years, and that will mean those with silver will once again more than double their purchasing power. Considering that the gold/silver ratio overshot to the upside and was as high as 100 in 1991, we fully expect it to overcorrect to the downside and possibly reach a low of 10 this decade. That would mean a more than tripling of ones purchasing power from the current ratio of 35.
 
When silver rose to $49.45 per ounce in 1980, the government said that the rise was due to the Hunt brothers "cornering" the silver market. The truth is, silver reached $49.45 in 1980 due to the massive inflation that was created by the U.S. government during the 1970s, and the Hunt brothers were used as a scapegoat. The Hunt brothers were accumulating silver in order to protect themselves from a collapsing U.S. dollar, just like NIA has been encouraging its members to do in a countless number of articles and videos over the past two years.
 
When the Hunt brothers were accused by the U.S. government of "cornering" the silver market and trying to manipulate silver prices higher, they only owned a concentrated long position of approximately 100 million ounces of silver. JP Morgan today has a concentrated naked short position in silver of approximately 122.5 million ounces, but the U.S. government doesn't seem to have any problem with it.
 
The problem with the Hunt brothers' strategy of accumulating such a large concentrated long position in silver is that after silver prices rose, their position was simply too large for them to ever sell without causing silver prices to crash. With silver reaching $49.45 per ounce in early 1980, the world was about to lose confidence in the U.S. dollar, which would have caused an outbreak of hyperinflation. In a desperate attempt to save the U.S. dollar and prevent hyperinflation, the CBOT raised margin requirements and limited traders' positions to only 3 million ounces of silver futures. The COMEX also limited traders' positions to 10 million ounces of silver futures. Not only that, but the COMEX and CBOT only had a total of 120 million ounces of silver in inventory, and the COMEX was likely going to default from futures contract holders requesting physical delivery. The COMEX was forced to go into "liquidation only" mode, ending all silver futures contract buying.
 
Combined with the Federal Reserve rapidly rising interest rates, silver prices began to plunge and the Hunt brothers were hit with massive margin calls. On one single day in March of 1980 when the Hunt brothers were forced to liquidate a large part of their position, silver lost 1/3 of its value, declining by over $5 to $10.80 per ounce. That represented a total decline of 78% from its high two months earlier.
 
NIA has been receiving a countless number of emails asking if now is the time to sell silver, and if silver could crash by 78% once again like it did in 1980. The fact is, while the Hunt brothers' 100 million ounce concentrated silver position was on the long side, JP Morgan's 122.5 million ounce concentrated silver position is on the short side.
 
While the Hunt brothers' long position was impossible to sell without causing silver prices to crash, JP Morgan's naked short position is impossible to cover without causing silver prices to explode to the upside. Being that the CFTC was so quick in 1980 to support the position limits that were then imposed by the CBOT and COMEX, NIA believes it would only be fair for the CFTC to mandate similar position limits today. This is unlikely to occur because the U.S. government believes JP Morgan's silver manipulation to be a good thing, since it is giving the phony appearance that the U.S. dollar still has purchasing power. The free market will ultimately win in the end and silver prices will soar through the roof to where they belong based on supply and demand fundamentals.
 
It is important to spread the word about NIA to as many people as possible, as quickly as possible, if you want America to survive hyperinflation. Please tell everybody you know to become members of NIA for free immediately at: http://inflation.us

(Washington, D.C. - March 28, 2011) A report released today by the Silver Institute forecasts a healthy outlook for global silver industrial demand, the largest component of annual silver fabrication demand. The report states that industrial uses of silver should rise sharply over the next five years to 666 million troy ounces (Moz) by 2015, representing 60 percent of total fabrication demand that year -- a 36 percent increase over 2010's figure of 487 Moz.

The report, The Future of Silver Industrial Demand, was produced by the leading precious metals consultancy, GFMS Ltd, on behalf of the Silver Institute. The report assesses the future prospect of total silver industrial demand over the next five years, and where sector growth opportunities are likely to emerge. The report underscores silver's unique characteristics that make it the metal of choice for a wide range of established industrial uses, particularly in electronics and thermal applications.

The report also focuses on many new uses that rely on silver's antibacterial qualities, where the incorporation of silver makes the difference between an ordinary product and a unique one. Noteworthy in the report is the potential market impact of 11 recent applications that incorporate silver. These uses which range from food packaging to radio frequency identification tags to autocatalysts, taken together could exceed 40 Moz of industrial demand by 2015.
Key findings from the report:

The report maintains that stronger silver industrial demand in the U.S. and Asia will be a key factor in driving growth in the global total through 2015, and healthy developing country demand especially in markets such as China and India, will also be an important factor.

Much of the forecast growth will come from established applications, such as silver's use in electrical contacts and in the photo-voltaic market.

The technical proficiency of silver limits the ability to switch in favor of lower-cost alternatives, making the metal largely price inelastic.

Emerging end-uses that benefit from silver's antibacterial properties or incorporate silver's electrical and thermal conductivity are expected to boost silver consumption through 2015.

"The report demonstrates how buoyant silver industrial demand is, not only because of the lack of substitution, but also because of the wide range of established and growing new uses that make up industrial demand," stated Michael DiRienzo, Executive Director of the Silver Institute. "This report maintains that we expect to see robust gains in industrial silver demand over the next five years, further emphasizing silver's essential role in industry," DiRienzo added.

Please click on the link below to download your electronic copy of The Future of Silver Industrial Demand report.

http://www.silverinstitute.org/images/stories/silver/PDF/futuresilverindustrialdemand.pdf

The Silver Institute is a nonprofit international industry association headquartered in Washington, D.C. Established in 1971, the Institute serves as the industry's voice in increasing public understanding of the value and many uses of silver.

Utah's tax code says U.S. Mint issued gold and silver coins are currency, rather than assets taxable by the state.
Dorothy Kosich
April 1, 2011
www.mineweb.com
RENO, NV

Utah Gov. Gary Herbert last week quietly signed a law which has made Utah the first U.S. state to recognize federally issued gold and silver coins as legal tender.  However, the governor chose not to make any public statement about the Utah Legal Tender Act.

Utah's state tax code now considers U.S. Mint gold and silver coins as currency, which means no capital gains or other state taxes will be levied when the coins are exchanged. However, the gold and silver coins are still only worth their face value despite record gold and silver prices.

A person only identified as close to Herbert told CNN, "If somebody is stupid enough that they want to buy a Snickers bar at 7-Eleven with a gold coin worth thousands of dollars, they will be able to do that."

Larry Hilton, an attorney and insurance salesman who authored the Utah Sound Money Act, said eliminating taxes on the exchange of the gold and silver coins places them in the same playing field as paper currency. However, federal taxes still apply. The law also does not apply to foreign minted gold coins.

He told the Salt Lake Tribune last December that the Utah Sound Money Act is "not intended to be compulsory in any way. The state is offering to taxpayers, "If you want to pay your taxes in gold and silver, we'll accept them."

James West, publisher of the Midas Letter, Wednesday called Utah Sound Money Act "a shot at the Federal Reserve. And Utah isn't alone. A few other states are considering similar bills."

"Conservatives fret that the central bank has permanently damaged the value of the dollar by pumping trillions into the economy, drawing down the greenback's buying power," he observed. "And Utah - where the Tea Party has a powerful presence - is leading the charge against Fed Chairman Ben Bernanke."

The Utah Sound Money Act was also promoted by Washington-based American Principles in Action, which is backing the Gold Standard 2012 program.

[Meanwhile, Congressman Ron Paul (R-Tx) has introduced H.R. 1098, The Free Competition in Currency Act of 2011, which would give legal tender gold and silver coins the same tax standing at the federal level that they now have in Utah. Unfortunately, Congressman Paul has not yet found cosponsors for the bill. Until he does, the bill will be given little consideration on Capitol Hill. Still, this bill shows that Ron Paul is eons ahead of his colleagues in Congress.]