Just for information purposes. in Arizona there are about a dozen or more gas outlets that accepts 90% silver as payment based on spot price ( know this as I had to travel through Arizona to get to California on a vacation a few years ago). It is happening and more and more often. As much as we want to believe that doomsday isn't coming...doomsday, unfortunately is already here. So you have a right to believe what you want...but so do others...just saying.
Ha ha ha! I laugh! "GOLD" would have to take a tremendous HIT in value for this to ever occur. Of course, those that have hoarded gold or accrued gold at $1000 to $2000 per ounce probably won't care when it's devalued and regulated down to $20 an ounce again? On the other hand, I suppose that a country could start to issue coins in gold (wait, we already do that!) but then, without price regulation, the value of the currency would fluctuate with the market. Right?
I like that last sentence in the ad. Do you know why the price of silver tripled during that period? Because the US government was 1 building up their stockpile, and 2 artificially supporting the collapsing silver market for the silver producing states. World price was as low as 25 cents and oz and the government was buying up domestically produced silver at as much as 70 cents an oz. That tripling was just from government price supports. Once they stopped buying the price fell back about 30%
Provident Metals issued a story about Oregon. http://www.blog.providentmetals.com...ation-accepting-90-junk-silver-as-payment.htm But then, Provident Metals has a vested interest in people buying and selling silver. Might I add that accepting 90% Silver coins at spot price is a bit gimmicky in that it could actually cost the merchant money. "Face Value" of coins minted in silver may not reflect that "actual" weight in silver due to circulation and wear. I have some junk Barber and SL Quarters that weigh in at 5.6 grams vs a 1964 Quarter which weighs 6.3 grams. Using the lighter coin based upon silver content is a loser for the merchant. What I think is occurring here is not so much "silver as currency" as much as the hopes that folks will bring in their silver hoards to pay for gas and spend a rare coin at silver value. But that's just my opinion. Additionally, I can guarantee you that the "trade value" of junk silver bullion coins is based NOT on the ask value of silver but probalby on 10% back of BID price for silver to address any costs associated with searching, handling, and ultimately smelting to convert the metal in "dollar values". A gimmick.
LOL. You can break it down all you want...the result remains the same...people are using 90% "junk" silver to buy services and goods and people are accepting 90% "junk" silver for services and goods. And it will become more and more popular as the fiat currency dwindles down to nothing and we go back to what we have "always" gone back to....Silver and Gold. JMHO.
Fiat currency is here to stay. There is not enough gold in the world to back the global economy we have today. It may have worked in the pre-industrial age with 500 million people in the planet and only a handful of European nations, Asian nations, and the US engaging in any significant amount of international commerce (which paled in comparison to the complex and massive webs of commerce we have today) , but it would just not work today. Which is why nations have abandoned a metals based economy for fiat. Also, silver's industrial use is very little today compared to what it was decades ago. Other than for some cheap jewelry and for bullion collectors, and the apocalypse believers, silver doesn't mean much to most people anymore, and the average person no longer associates silver with money (despite you wishing it so). Hey, I like silver as much as anyone else here. I collect nothing but ancient and medieval silver coins, but I have no pretensions that silver is going to become this magical get rich thing. And if the global economy did collapse to the point fiat money was meaningless (as highly unlikely as that is) ...silver and gold would be the least of your worries. Getting basic necessities such as food and clean water, and not being murdered, would be the priority. You can't eat or drink gold and silver, and it won't keep a sociopath who can no longer find medicine to control his murdering urges from hacking you to death with a rusty knife. I definitely would not want to live in that nightmare of no commerce, no luxuries, no basic necessities, no law and order, and complete chaos (ie. the stone age all over again). Not that it will happen, as fiat can be reissued, revalued, etc., making the doomsday scenario unlikely.
Just like every other time that we've moved away from a fiat-based electronic system that can transfer payments in the blink of an eye at near-zero transaction cost, instead of shipping gold bars across the country on a wagon also carrying what you hope are enough armed guards to hold off any bandits. Oh, wait.
I've made this argument myself in the past, but I decided it doesn't really hold water. They sell metal for fiat because they have sources where they can buy the same amount of metal for less fiat. As long as the markets where they buy and sell metal run on fiat, that's the form in which they'll take their profits, whether they're True Believers, cynical con-men, or just folks trying to run a business.
Keep in mind there's a whole section of CT populated by "true believers" in the big silver lie. I don't know precisely where Jason's living, but I can tell you this - it ain't like where I'm living, and I don't want to be living where he's living.
The economy we have to day is unsustainable longer term. It is based upon perpetual increases in substantial amounts of artificial cheap credit and its counterpart, debt. I don't believe there needs to be a return to a precious metals standard (gold or silver) but don't consider it a given that there would be a shortage under one or a monetary system with multiple options as money. The only reason there would be a "shortage" of circulating currency or "money" in today's economy is because a money supply which isn't infinitely flexible (in other words, expanding) cannot service a correspondingly perpetual increase in debt. However, perpetually increasing debt isn't necessary for any economy or prosperity. I own some silver but it isn't material to my financial position. I don't consider it a monetary equivalent to gold but there are plenty of people elsewhere (especially the "developing" world) who do. I am still bearish on its USD price and still believe it will fall below the recent $13.91 low and possibly below $8.39, the October 2008 low.
Sounds like a compelling argument except for one thing - it leaves out of the picture a little thing called a growing GDP. Of course, so has the world economy lately, pretty much, but it doesn't need to. Debt treated as a raw number looks unsustainable. Debt compared to productivity looks far less daunting. I suggest that we don't have too much debt, we simply have too little productivity. The digital revolution explains a fair piece of it - we need fewer people working to produce what the world needs. The problem is distribution, plain and simple. We've decided that one guy with an idea in Palo Alto is worth billions, and he gets to decide as an "angel investor" which entrepreneurs live and die, and the people he ultimately threw out of work can just starve or clean hotel rooms.
What is seldom discussed is whether we can ever return to a manufacturing-based economy. Due to automation of most processes, manufacturing has gone the way of subsistence farming. It's not a matter of it coming back. Not gonna happen. The real question becomes, when a few can provide for all, how do things get distributed? Money and materials must flow to the producers. But the consumers have no engagement in the economy. I think we are in the early throes of dealing with this. As I saw posted the other day, in Star Trek the Enterprise has a crew of 440. Ten are needed to run it. What do the other people do?
That's easy. They walk around in pairs carrying clipboards and wearing red shirts waiting to be sent to some planet as part of an away party, to meet their certain doom. No, but seriously, about 350 must be tied up in filming, lighting, editing, running the Foley sound stuff, all the pre and post production stuff. Oh, and I bet a bunch have to maintain that artificial gravity stuff. And while we're on Star Trek, why do they always face other starships as if they're in basically a 2-dimensional space rather than 3?
Look, we already have certain strategic manufactured products we do not ever outsource, at least that we admit. What if ALL manufacturing for the domestic market were deemed to be strategic? Every other nation on the planet, even our closest allies, practices home market protectionism. If they didn't, how could European agriculture survive? We can out produce anyone. We need to wise up and join the same thing everyone else does - make trade a jobs policy. The family farm still thrives where I live because people here absolutely insist it must, and pay to maintain it with Ag preservation tax abatements for family farms.
I have never been a gloom and doom person but here are some facts...50% of all fruit and vegetables are produced in California. Going on three years of drought they now have extreme water rationing, many lakes completely dried up and are using ancient ground water to water with. We cannot maintain a $23 trillion debt forever either. Even the farmers that are surviving are seriously struggling to do so. And with only a handful of giant AG. conglomerates controlling supply and distribution, weather patterns that are cyclical but destroying coast lines with more intense storms, a crumbling infrastructure, how much longer does anyone think this can last without something serious coming down. Back to silver...if the banks closed and your credit/savings was inaccessible, I think I would like to be able to trade my silver out for groceries for at least a little while. Maybe wishful thinking but a whole lot better than the option of pointing a gun at someone to feed myself. I would prefer to be prepared than to sit on the fence post thinking Big Daddy is coming to bail us out with a miracle plan. And Kurt, you are correct, we need to wise up, sooner rather than later. I live in farm country also and they are surviving but just barely.
Yes, in theory, if you divide the debt and all corresponding wealth and production equally or a lot more equally, it is sustainable or looks it. But that isn't how it is and it's never going to be that way. In actuality, the people, companies and countries who are least able to service their debts with their incomes and asset bases are never going to be able to service it in the long run and there are plenty enough of them from mortgage borrowers, overleveraged banks and countries like China and Greece to bring the whole system crashing down which is exactly what is going to happen. Also, I don't believe GDP is a good measure of actual production. It is measuring monetary turnover. There is a lot of activity captured in GDP that is actually waste and should really be subtracted from it because it doesn't add any real value whatsoever. If far fewer people work, then I presume the supposed solution is a guaranteed income. Good luck with that in the longer term because it is contrary to human nature. The recipients will always want more and more and the productive are not about to support them forever. Since current economic policy is going to fail in preventing declining living standards (and it will), I expect "helicopter money" in the form of a guaranteed income to be tried at some point. It will "work" temporarily but nothing more and then what? Adverse demographics, automation which will make a large number of people economically redundant, global labor competition, offshoring and government sponsored moral hazard on a colossal scale all add up to a financial system which is designed to fail. And no, I am not a doom and gloomer. I just believe that most people are going to become poorer or a lot poorer. there is no reason to believe that most people should and will be better off continually over time.
