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-- Posted 27 June, 2004 | Digg This Article
FRIDAY, June 25th, 2004
This week's report lists 111 silver stocks. There are 31 silver stocks that list reserves, resources (and exploration potential.) which I calculate by using my "ounce in the ground" forumula. There are 50 explorers. There are about 30 additional "silver" stocks with incomplete information. Additions & Changes from last week are in bold.
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To read about my religious bias, see my other website, bibleprophesy.org There are two essays near the top of the page that explain why I believe the entire world will return to using gold and silver as money again before the end times. Hint, see Ezekiel 38. To read more about my religious bias when it comes to investing, see my essay, Biblical Guidelines for Managing your Money
Kitco reports silver at $6.10/oz. as of Friday, 2:20 PM West Coast US, which was used to calculate the following figures. The CAN $ / US $ conversion factor is .7405. I will use .74 for ease.
How to read the following table:
Stock Symbol that works at Yahoo! Finance (Company name) / Silver oz. "in ground" for 1 oz. silver's worth of stock. / valuation price change since last week relative to silver price change (and stock dilution, and resource changes, if any) / additional comments (EXPT is "exploration potential")
Company names in bold have summaries below with updated information.
- ABX (BARRICK) 0.95 up --infamous hedger (16? mil oz. gold hedged, 3 yrs production)
- CDE (COEUR D'ALENE) 1.3 even --(also gold) in debt, produces at a loss.
- IPOAF.PK (INDUSTL PENOLES) 1.8 even --current producer, mostly family owned, hedged?
- GRS GAM.TO (GAMMON LAKE) 3.2 down --current producer, owns 26% of Mexgold
- SIL (APEX SILVER) 3.4 down --zinc bonus, low grades, cash rich--$345 million! in debt
- FSR.TO FSLVF.PK (FIRST SILVER) 4.3 up --current producer, (not profitable '03 3rd q.) unhedged
- PAAS (PAN AMERICAN SILVER) 4.8 up --current producer, debt free
- MFN MFL.TO (MINEFINDERS) 5.2 even --significant gold bonus, $35 mil cash on hand.
- KBR.TO KBRRF.PK (KIMBER RSCS) 5.8 down One property, high grades, with exploration potential.
- WTZ WTC.TO (WESTERN SILVER) 5.8 up -- (20 EXPT) large mine development cost. copper & zinc bonus
- CFTN.PK (CLIFTON MINING) 5.9 up -- (142 EXPT) (colloidal silver patent bonus)
- SSRI SSO.V (SILVER STD RSC) 7.3 up --large company, many properties, owns silver bullion
- * TM.V TUMIF.OB (TUMI RSCS) 8.2 up -- (16 EXPT) recent bonanza grade silver discovery
- SHSH.PK (SHOSHONE SILVER) 9.5 down near SRLM.PK, CDE, HL.
- ORM.V OREXF.PK (OREMEX RES) 9.5 up (40 EXPT)
- CZN.TO CZICF.PK (CDN ZINC) 9.3 up --large zinc bonus, high grades, low start up costs, great EXPT
- SRLM.PK (STERLING MINING) 13.6 down --(32 EXPT) acquired the Sunshine in Cour d'Alene
- IMR.V IMXPF.OB (IMA EXPL) 14.6 down (58 EXPT) --Explorer in Argentina
- FAN.TO FRLLF.PK (FARALLON RSCS) 15.3 up --(26 EXPT) low grades, silver 1/3; also gold & zinc bonus.
- CHD.V CHDSF.PK (CHARIOT RSCS) 15.8 down (explorer, with inferred resources)
- GGC.V GGCRF.PK (GENCO RESOURCES) 19.6 way down --producer in Mex. Plans to expand and acquire
- RDV.TO RDFVF.PK (REDCORP VENTURE) 17.6 down --60% gold bonus
- ADB.V ADBRF.PK (ADMIRAL BAY RSCS) 21.1 up --exploring silver property. (Huge gas bonus)
- * PLE.V (PLEXMAR RES INC) 25.5 down
- EXR.V EXPTF.PK (EXPATRIATE RECS) 28.6 up --significant zinc bonus 60% zinc, 25% silver (got out Atna)
- * MGN (MINES MGMT) 30.3 up --60% copper bonus (low grades), start up cost ~ $250 mil
- * SVL.V STVZF.PK (SILVRCRST MINES) 30.5 up --(51+ EXPT) --(Silver in Honduras) +
- HDA.V (HUSIF?) (HULDRA SILVER) 31.3 down --very tiny, zinc bonus, low start up costs.
- ABI.V ABMBF.PK (ABCOURT MINES) 31.7 up --large zinc & small gold bonus
- * ASM.V ASGMF.PK (AVINO SILV GOLD) 40.3 up --will own 49%-100% of the Avino +4 other silver props.
- UNCN.OB (UNICO INC) 57.3 down --lease on largest property, needs $1 mil by Sept 1 2004.
* = I own shares
Explorers (by market cap, in millions):
- HL (HECLA MINING CO) .45 --A PRODUCER (gold bonus) cash rich.
- MGR.V MGRSF.PK (MEXGOLD RSCS) 7.3 -- bonanza grade discovery on Jan 13th, 2004
- SPM.V SMNPF.PK (SCORPIO MINING)
- CDU.V CUEAF.PK (CARDERO RSCS)
- AOT.V ASOLF.PK (ASCOT RSCS) -- owns percentage of Cardero, CDU.V
- * FCO.TO FCACF.PK (FORMATION CAPTL) Cobolt (and Sunshine silver refinery)
- * OTMN.PK (O.T. MINING) very large exploration potential
- * MMGG.OB (METALLINE MINE) --zinc/silver (historic high grade silver) (low cost revolutionary oxide zinc process)
- TVI.TO TVIPF.PK (TVI PACIFIC) --current producer of a dore silver bar 96% silver, 4% gold
- MCAJF.PK (MACMIN LTD)
- * FR.V FMJRF.PK (FIRST MAJESTIC) -- Bought a former silver producer. Acquiring silver properties.
- IAU.V ITDXF.PK (INTREPID MINRLS) 7 "exploration potential"
- * NPG.V NVPGF.PK (NEVADA PAC GOLD) 27-138 "exploration potential" (owns 1 silver property, 10 gold properties)
- MAI.V MNEAF.OB (MINERA ANDES) (gold bonus)
- MAG.V MSLRF.PK (MAG SILVER)
- ECU.V ECUXF.PK (ECU SILVER MINI) --50% gold bonus
- CAUCF.PK (CALEDON RES)
- * EDR.V EDRGF.PK (ENDEAVOUR GOLD) A PRODUCER (I could not yet find a listing of resources or reserves)
- PXI.V PNXPF.PK (Planet Exploration Inc.)
- * CBE.V CBEFF.PK (CABO MINING) --Historic Silver and Cobalt district
- QTA.V QURAF.PK (QUATERRA RES)
- EPZ.V ESPZF.PK (ESPERANZA SILVR)
- BZA.V ABZGF.PK (AMER BONANZA)
- NJMC.OB (NEW JERSEY MIN)
- BCM.V BCEKF.PK (BEAR CRK MINING)
- DNI.V DMNKF.PK (DUMONT NICKEL) exploring Clifton's property
- EXN.V EXLLF.PK (EXCELLON RSCS)
- * KG.V KDKGF.PK (KLONDIKE GOLD)
- SML.V SMLZF.PK (STEALTH MNRLS)
- APM.V (Amerix Precious Metals Corp) (NEW BULLET GP)
- SDR.V SDURF.PK (STROUD RSCS)
- SRY.V (STINGRAY RSCS)
- * CMA.V CRMXF.OB (CREAM MINERALS) 217 "exploration potential" (low grades)
- CHMN.PK (CHESTER MINING)
- GNG.V GGTHF.PK (GOLDEN GOLIATH) --Historic silver district in Mexico
- GPR.V GPRLF.PK (GREAT PANTHER)
- * KRE.V KREKF.PK (KENRICH ESKAY)
- MMG.V MMEEF.PK (MCMILLAN GOLD)
- EGD.V EGDMF.PK (ENERGOLD MINING)
- LEG.V LEGCF.PK (LATEEGRA RSCS)
- * AUN.V AUNFF.PK (AURCANA CORP)
- TUO.V TEUTF.PK (TEUTON RES)
- PCM.V PAOCF.PK (PAC COMOX RES)
- BGS.V BLDGF.PK (BALLAD GLD SLVR)
- ASLM.PK (AMER SILVER MINI)
- BBR.V BBRRF.PK (BRETT RES)
- ROK.V ROCAF.PK (ROCA MINES INC)
- MTB.V (Mountain Boy Minerals Ltd)
- LSM.V LASCF.PK (Langis Silver & Cobalt Mining Co Ltd)
- CBP.V CPBMF.PK (CONS PAC BAY MIN)
* = I own shares
Silver oz. "in ground" means and counts all "silver oz. in the ground" as the same, but they are NOT EQUAL. Some are more certain and others are more speculative. Some are higher grades, some are lower grades. They range from most certain to least certain such as: "proven & probable reserves," "measured, indicated, inferred resources." This single number next to each stock symbol above represents the approximate number of ounces of silver in the ground you are buying title to when you invest the equivalent of one ounce of silver into buying shares in the company at current prices. Here's the math on how to get it. 1. Get a market cap in U.S. dollars. Divide that by the silver price, so the market cap is denominated in terms of silver ounces. Then, divide the ounces in the ground by the market cap as denominated in silver. This tells you how many ounces of silver in the ground you are buying when you give up one ounce of silver in you hand for shares of stock, instead.
(It does not include zinc, or copper, or lead, but it does include gold at a 1:10 ratio of gold:silver.) At goldsheetlinks.com, they add 100% of proven & probable reserves, but only 70% of measured & indicated resources, and only 50% of inferred resources. I don't do that. I count them as all the same.
I believe that the two most important numbers that a silver mining company can report are the resources in the ground, and the number of their fully diluted shares. Of course, there is much more to a mining company than that, but without those numbers, it is extremely difficult to even start an evaluation. This report highlights those key numbers, where possible. If you think those numbers are also important, please email the executives of the mining companies you own, and ask them to make sure their numbers are clearly published at their websites.
To quickly "tab" down to the company you are interested in, note the symbol. Then hit "control-F" to "FIND" the symbol below.
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If I use a word you don't understand and is not listed in the dictionary at www.m-w.com you can look up the meaning at http://investorwords.com/
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WEEKLY COMMENTARY (All new in this section):
In general, the silver stocks seemed quiet this week. It seems as if we are in the calm before the storm of rising prices. I say this because I feel investor interest is low, and I have two reasons to back this up. First, emails to me are less than usual, and the signups are down. Second, open interest is down.
And yet, we have rising prices, at $6.10, and many of the silver stocks slightly outperformed silver in the last week.
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About six months ago, I calculated the total market cap of the silver stocks on this list at about $7 billion. Today, 6 months later, it's about 8 billion.
As of today, the total market cap of the silver stocks on this list is the following:
- CDE (COEUR D'ALENE) $897 mil MC
- IPOAF.PK (INDUSTL PENOLES) $1431 mil MC
- GRS GAM.TO (GAMMON LAKE) $439 mil MC
- SIL (APEX SILVER) $818 mil MC
- FSR.TO FSLVF.PK (FIRST SILVER) $59 mil MC
- PAAS (PAN AMERICAN SILVER) $944 mil MC
- MFN MFL.TO (MINEFINDERS) $228 mil MC
- KBR.TO KBRRF.PK (KIMBER RSCS) $37 mil MC
- WTZ WTC.TO (WESTERN SILVER) $303 mil MC
- CFTN.PK (CLIFTON MINING) $43 mil MC
- SSRI SSO.V (SILVER STD RSC) $733 mil MC
- * TM.V TUMIF.OB (TUMI RSCS) $19 mil MC
- SHSH.PK (SHOSHONE SILVER) $10 mil MC
- ORM.V OREXF.PK (OREMEX RES) $15 mil MC
- CZN.TO CZICF.PK (CDN ZINC) $46 mil MC
- SRLM.PK (STERLING MINING) $104 mil MC
- IMR.V IMXPF.OB (IMA EXPL) $102 mil MC
- FAN.TO FRLLF.PK (FARALLON RSCS) $39 mil MC
- CHD.V CHDSF.PK (CHARIOT RSCS) $13 mil MC
- GGC.V GGCRF.PK (GENCO RESOURCES) $12 mil MC
- RDV.TO RDFVF.PK (REDCORP VENTURE) $13 mil MC
- ADB.V ADBRF.PK (ADMIRAL BAY RSCS) $26 mil MC
- * PLE.V (PLEXMAR RES INC) $9 mil MC
- EXR.V EXPTF.PK (EXPATRIATE RECS) $21 mil MC
- * MGN (MINES MGMT) $53 mil MC
- * SVL.V STVZF.PK (SILVRCRST MINES) $18 mil MC
- HDA.V (HUSIF?) (HULDRA SILVER) $2 mil MC
- ABI.V ABMBF.PK (ABCOURT MINES) $4 mil MC
- * ASM.V ASGMF.PK (AVINO SILV GOLD) $16 mil MC
- UNCN.OB (UNICO INC) $5 mil MC
Total: $6,459
- HL (HECLA MINING CO) $689 mil MC
- MGR.V MGRSF.PK (MEXGOLD RSCS) $140 mil MC
- SPM.V SMNPF.PK (SCORPIO MINING) $73 mil MC
- CDU.V CUEAF.PK (CARDERO RSCS) $63 mil MC
- AOT.V ASOLF.PK (ASCOT RSCS) $9 mil MC
- * FCO.TO FCACF.PK (FORMATION CAPTL) $66 mil MC
- * OTMN.PK (O.T. MINING) $60 mil MC
- * MMGG.OB (METALLINE MINE) $43 mil MC
- TVI.TO TVIPF.PK (TVI PACIFIC) $46 mil MC
- MCAJF.PK (MACMIN LTD) $50 mil MC
- * FR.V FMJRF.PK (FIRST MAJESTIC) $36 mil MC
- IAU.V ITDXF.PK (INTREPID MINRLS) $29 mil MC
- * NPG.V NVPGF.PK (NEVADA PAC GOLD) $44 mil MC
- MAI.V MNEAF.OB (MINERA ANDES) $27 mil MC
- MAG.V MSLRF.PK (MAG SILVER) $26 mil MC
- ECU.V ECUXF.PK (ECU SILVER MINI) $27 mil MC
- CAUCF.PK (CALEDON RES) $27 mil MC
- * EDR.V EDRGF.PK (ENDEAVOUR GOLD) $23 mil MC
- PXI.V PNXPF.PK (Planet Exp Inc.) $16 mil MC
- * CBE.V CBEFF.PK (CABO MINING) $21 mil MC
- QTA.V QURAF.PK (QUATERRA RES) $20 mil MC
- EPZ.V ESPZF.PK (ESPERANZA SILVR) $18 mil MC
- BZA.V ABZGF.PK (AMER BONANZA) $16 mil MC
- NJMC.OB (NEW JERSEY MIN) $16 mil MC
- BCM.V BCEKF.PK (BEAR CRK MINING) $11 mil MC
- DNI.V DMNKF.PK (DUMONT NICKEL) $10 mil MC
- EXN.V EXLLF.PK (EXCELLON RSCS) $15 mil MC
- * KG.V KDKGF.PK (KLONDIKE GOLD) $11 mil MC
- SML.V SMLZF.PK (STEALTH MNRLS) $12 mil MC
- APM.V (Amerix Precious Metals Corp) $11 mil MC
- SDR.V SDURF.PK (STROUD RSCS) $15 mil MC
- SRY.V (STINGRAY RSCS) $11 mil MC
- * CMA.V CRMXF.OB (CREAM MINERALS) $8 mil MC
- CHMN.PK (CHESTER MINING) $7 mil MC
- GNG.V GGTHF.PK (GOLDEN GOLIATH) $6 mil MC
- GPR.V GPRLF.PK (GREAT PANTHER) $9 mil MC
- * KRE.V KREKF.PK (KENRICH ESKAY) $8 mil MC
- MMG.V MMEEF.PK (MCMILLAN GOLD) $7 mil MC
- EGD.V EGDMF.PK (ENERGOLD MINING) $7 mil MC
- LEG.V LEGCF.PK (LATEEGRA RSCS) $6 mil MC
- * AUN.V AUNFF.PK (AURCANA CORP) $5 mil MC
- TUO.V TEUTF.PK (TEUTON RES) $4 mil MC
- PCM.V PAOCF.PK (PAC COMOX RES) $3 mil MC
- BGS.V BLDGF.PK (BALLAD GLD SLVR) $3 mil MC
- ASLM.PK (AMER SILVER MINI) $3 mil MC
- BBR.V BBRRF.PK (BRETT RES) $3 mil MC
- ROK.V ROCAF.PK (ROCA MINES INC) $2 mil MC
- MTB.V (Mountain Boy Minerals Ltd) $2 mil MC
- LSM.V LASCF.PK (Langis Silver) $2 mil MC
- CBP.V CPBMF.PK (CONS PAC BAY MIN) 1 mil MC
Explorers Total: $1,767 million MC
+
First List Total: $6,459
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$8,226 million grand total. Thus, I have a new statistic for "The money chart"
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The registered silver at the COMEX has been dropping steadily.
This week:
Report #40 45,700,000 oz.
Report #39 46.9 mil oz.
Report #38 46.9 mil oz.
Report #37 46.9 mil oz.
Report #36 48 mil oz.
Report #35 48 mil oz.
Report #34 49 mil oz.
Report #33 49 mil oz.
Report #32 51 mil oz.
Report #31 51 mil oz.
Report #30 52 mil oz.
6.3 million ounces depleted in the last ten weeks. If this continues, the registered silver, 45.7 mil oz. / 6.3 mil oz. in ten weeks, will last 72 weeks.
Silverinstitute.org, at http://www.silverinstitute.org/wssum03.pdf for 2002, lists 20.9 mil oz. as "implied net disinvestment" or investor selling, and 71.3 mil oz. for net government sales, for a total of 92.2 mil oz. of selling of existing refined above ground silver supplies to meet demand in 2002.
GPMgroup.com, at http://www.cpmgroup.com/SSpress2004.pdf for 2002, lists investor selling as 81 mil oz., and for 2003 lists investor selling as 43.5 mil oz.
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On Wednesday of this week, I finally had time to do an hour and a half interview with my local newspaper, www.theunion.com. I had tried contacting them ever since the article on GATA that came out in Smart Money magazine. I didn't have time since then until now because I was headed to New York and then Vancouver for two gold shows. I think the interview went well. It lasted an hour and a half. The local business reporter had visited my website, was well prepared with questions, and he had a photographer take my picture.
On Thursday of this week, silver moved up 30 cents, or 5% for the day.
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This week my broker got chewed out by his superior because my portfolio was so concentrated in silver stocks, and private placements, and I just put in the paperwork request for another one. Apparantly, they felt I should have been taking more profits, and "taking money off the table". Odd, don't they know that's exactly what I'm doing as I buy silver and silver stocks? Silver IS money off the table. Dollars, stocks, bonds--that's all money on the table! My broker came to my defense, saying "Look at the returns he's gotten." So, my request for another private placement was approved.
--------------------------
Last week, I wrote an article:
I'm insanely bullish on silver.
My article was published at gold-eagle.com, goldseek.com, freebuck.com, mineralstox.com, and a few others. My article was the top headline at economicbriefing.com on June 21. http://www.economicbriefing.com/level2/hommel-silver.html Kitco did not publish, which was not unusual. 321gold.com also did not publish, which is not unusual, as only a few of my articles have ever been published there. However, Bob Moriarty of 321gold.com did start writing to me about my article, an exchange which I think is quite interesting. When I asked Bob permission to publish our exchange, he said no, and threatened me with a copyright lawsuit. So, I have decided to shorten and paraphrase a few of his remarks, and quote others, as needed. I was going to leave his name out of it and keep him anonnymous if he didn't give permission, but due to his threats, I decided that I didn't need to give him the courtesy to keep his remarks annonymous. Furthermore, Bob of 321gold.com is already a rather public figure in the gold/silver industry. What's really ironic is that here I am, going against the most powerful people in the world, the Federal Reserve and their paper money, and Bob has the audacity to insult my work, and then ask me to keep his insults a secret, and then threaten me with a lawsuit if I don't. As if I'm afraid of Bob Moriarty. He literally emailed me five times to ask me (and threaten me) to not publish this. Therefore, I'm sure many of you will enjoy it!
So, although my article was generally well received, Bob Moriarty of 321gold.com decided to question me on a few things. I certainly don't intend to pass off Bob's writings as my own. Therefore, to be abundantly clear, Bob's paraphrased and quoted comments are in italics. Mine are bold text.
Bob's first reply to me:
I wrote to Bob: 1. The world has nearly run out of silver.
Bob's reply (Paraphrasing): Can you say who says so? Don't you think a low price means there is more than enough supply?
Why is every primary silver mine in the world shut down if there's not an abundance of silver?
Paraphrasing: There is a lot of silver in the world. Just little demand. Not until our money is backed by something will there be demand for silver. Until then, silver "will stay in the doldrums." "There is a lot of silver around."
Bob
==============
My first reply to Bob:
Paraphrasing: Can you say who says so?
So says CPMGroup, Silverinstitute, David Morgan, Ted Butler, myself, the U.S. government, and the COMEX, in their reply to the demands of market manipulation.
Paraphrasing:Don't you think a low price means there is more than enough supply?
As I reported in my article, silver is coming to market through several sources that do not care at all about price.
1. It's coming to market as by-product production, so they DON'T CARE what they get for it.
2. It's coming to market through investors who inherit it, so their cost of acquisition is "free" to them, and they are totally ignorant of supply/demand fundamentals, since they did not buy it, nor work to get it.
3. It's coming to market from governments who sell it.
Again, I covered all of this in my article.
Paraphrasing: Why is every primary silver mine in the world shut down if there's not an abundance of silver?
The low price is why every primary silver mine in the world is shut down. This proves my point that silver is cheap.
Paraphrasing: There is a lot of silver in the world.
Says who? Where? Define "lot". Define "silver". Are you counting silver in the ground? I was not, I was speaking of above ground, refined silver.
Paraphrasing: Just little demand.
True. But it is the type of current demand that is most interesting. All industrial, jewelry, and photography, which is far exceeding mine supply alone, which is creating a very interesting situation if investors ever start to buy.
Currently, there is net investor selling, not buying. But watch what happens when that changes, which it may change, if you do things like publish my article.
Paraphrasing: Not until our money is backed by something will there be demand for silver.
ABSOLUTELY NOT!!! Did you not read my article? There will be demand for silver if less than 1% of dollar holders decide to protect their money, which will push the price up way beyond $50/oz. Are you incabable of doing the math or the reading to realize this, or is it just general impatience and business that prevents you from getting to it?
Quoting: "Until then," silver "will stay in the doldrums."
Doldrums? Where in the world have you been??? Silver went from $4.15 to over $8.40, more than 100% gain, and then slashed down to $5.50. Doldrums? What is your basis of comparison??? This is exciting! Have you not seen SRLM, a stock that you wrote up, go from .25 to $13/share? Doldrums????
Quoting: "There is a lot of silver around."
Says who? I listed seven sources in response to your question. Can you list 7 that say there is lots, and who actually define "lots"? I bet not.
And by the way, thanks for publishing my articles in the past.
====================
Bob's second reply to me:
Paraphrasing: Have you passed Economics 101? Quoting Bob, "95% of what you say is bull----." Paraphrasing: Don't you think that any increase in the price of silver will increase the supply, due to the fact that most of the primary silver mines are shut down now? Quoting: "The world is not running out of silver and isn't ever going to." I think you need to "take a course in economic geology."
Paraphrasing: A lot of people are losing money because of you and Ted Butler.
Bob
====================
My second reply to Bob:
I did take econ 101, and I understood all the concepts, and got an A. Took several business courses in college. I was an A student, often receiving the highest scores on exams repeatedly.
I scored 1330 on my SAT. 600 verbal, 730 math.
I scored 1330 on my GRE, after college, too. 630 verbal, 700 math, and 720 analytical. A score of 800 is the max score, 500 is average. I'm two standard deviations above the mean, in my analytical and math abilities.
I suspect you would be better off to study history, the history they do not teach in Economics 101.
Yes, I do believe that an increase in the price of silver should increase the supply. This is why over 85% of my portfolio is invested in the silver mines, and 15% is in physical silver.
But guess what? The supply of silver DID NOT increase in 1980. Remember the year of the silver price spike to $50/oz.? Apparantly, it was not enough to bring on significantly more production, not for years. The year 1980 saw lower production than 1979!
But you also seem to fail to realize that a higher price for silver can INCREASE demand significantly, as people begin to view it as money again, and buy silver to protect their dollar holdings.
I do not care if they are even able to double silver production from here, that may not be enough to satisfy the tidal wave of dollar and other fiat money demand, once a silver bull market gets rolling. After all, what is 500 million oz. of silver? $2.5 billion? I'm sorry, but in a dollar crash, that may not satisfy the many trillions out there.
And yes, we ARE running out of silver above ground, in refined form. The U.S. government also says so. An 8th source I forgot to mention to you last time. See here, two reports. One contains U.S. government supplies, the other is supplies by U.S. industry and business. Both show we are nearly out.
Here are two U.S. Government produced reports on silver, containing data on years from 1900 to present, on U.S. & world production, and U.S. consumption, and U.S. industry & government stockpiles.
Report #1
http://www.goldismoney.com/ssr/USsilver.xls
Report #2
http://www.goldismoney.com/ssr/USsilver2.xls
I evaluated these government produced reports in my silver stock report #36.
In sum, we are running out of silver. The U.S. government had over 3 billion ounces of silver in 1940, and today, has very little left, or none.
I do not dispute that there are billions of ounces still in the ground, unmined, much of it uneconomical to extract today, and that's the point.
There is not a single untrue statement anywhere in my article, and despte the fact that you say that 95% of it is bull----, you cannot even refute a single point! All you have presented to me is your confusion and lack of understanding of the concepts I've presented.
Oh, and insults, like "You would be a lot better if you took Economics 101 and passed."
If you like, I would be happy to re-write my article for your readers, and add a few more details, such as we've discussed in this email, and turn it into a question and answer session. --leaving out the insults and personal attacks, of course.
==================
Bob's third reply to me:
You write bull---- and assert "unprovable points." "In late November of 1979, the price of silver was $15". It spiked "to $50 in less than 7 weeks." Paraphrasing: Implying that in as short as seven weeks, we could have a huge supply of silver as people sell personal hoards, just like back then.
I think you steal/copy the work of Ted Butler by talking about "refined silver".
Quoting: "Who cares about refined silver? Silver is silver is silver." Study and you will find "that there are billions of ounces of silver in India just waiting for higher prices to drag it out."
Quoting: "Price says silver is abundant and nothing you say disproves that." Paraphrasing: Everyone in the mining business knows there is plenty of silver in the ground in the world. Quoting: "If the mines now closed come on line, supply has to increase."
Quoting: "So if your primary thesis "The world is running out of silver" is dead wrong, it obviously makes everything else you say suspect."
Quoting and Paraphrasing: "The world is not running out of silver." In 1940, the U.S. government had 3 billion ounces in reserves. Isn't that "a bit absurd?" This supply created a "50 years surplus of silver dragging on the market." It is you who need to study history.
Quoting: "Figure out why we had that much silver and you would come closer to understanding why silver is cheap now."
Bob
==================
My third reply to Bob:
Yes, the U.S. government was supporting the price of silver, by keeping the ratio at 15 to 16 to one ounce of gold. The government was paying the mines much less, but buying silver in the open market for more.
And this accumulation of silver, you could say, was the result of the U.S. manipulating the market upwards. You could also say this was the result of other nations of the world demonetizing silver, which created a glut of silver that flowed to those who valued it more, which was us.
In January 1980, when silver hit $50, there were lines all outside the silver shops, both buyers and sellers. The buyers line usually far exceeded the seller line, or so they tell me. Sometimes, a shop would run out of silver, other times, they would run out of cash, the volumes were so huge. If they ran out of silver, they'd have the silver sellers step to the front of the line.
Yes, silver did come out of the woodwork in 1980, and much old silver coin was melted. How much? I suppose it was 200 million ounces in a year? I do know the refineries got backed up due to this, and that payments could not be made fast enough. So, net, there was more selling than buying.
Who cares about refined silver, you ask? Any industrial user. They need the refined stuff. Silver in the ground does them no good. They not only need it refined, but also delivered to their factory. And you think I need an econ 101 lesson?
India. I know about India. I addressed that in my article. India, you say, could sell silver. I agree. They could. But today, they are not, they are importers. Net importers of silver are not exporters of silver. Again, you say I need to study econ 101? Let's count India as an exporter on the day they become an exporter, and not before, ok?
Price does not prove that silver is abundant. Price proves that the silver coming to market is currently meeting current demand.
Price says that silver coming to market is coming to market in an uneconomic way. IE, three ways: 1. byproduct mining, 2. Inheritance selling, 3. government selling.
Price does not disprove the shrinkage and very small size of existing refined supplies, which are dwindling due to investor selling and government selling, which is helping to create the uneconomic price.
Finally, if I'm wrong on one point, no, it does not disprove all other points I may say. And no, I'm not wrong on a single point so far.
Let's get back to 1980. Back then, many people were panic buying because many thought the dollar was going to go the way of the German Reichsmark. Their fears were justified, there was a precident for that. Although it did not happen, much of the excess creation of dollars was burned off. Back then, by the time of the peak, there were only 10 times as many dollar printed up as could be backed by the U.S. official gold.
Today, there are 91 times as many dollars in M3.
But if the dollar crashed completely in 1980, the price would have been ten times higher than $50/oz. It would have hit $500/oz. Today, if we adjust for the money that has been created since then, the price might be up to $3000/oz. for silver.
And in such a situation, when there is true panic selling of the dollar as it is being destroyed, demand for silver (and gold) will exceed demand for dollars, because everyone will be waking up to the fraud of what dollars are, all at once.
==================
Bob's fourth reply to me:
Bob responded to a few of my points, point by point:
on 6/19/04 2:40 PM, Jason Hommel at bibleprophesy@yahoo.com wrote:
Yes, the U.S. government was supporting the price of silver, by keeping the ratio at 15 to 16 to one ounce of gold. The government was paying the mines much less, but buying silver in the open market for more.
Quoting: "That's not the way it happened. The government started buying silver at $1.29 an ounce in late 1932 to support the mining business. In Dec of 1932 the price had dropped to $.25 an ounce. But while they paid $1.29 for all the silver Americans could produce, they also charged a $.50 an ounce tax. The net effect was to pay $.79 an ounce for silver that the free market only valued at $.25. And naturally the miners supplied a lot more silver than the market needed."
... eliminating remarks...
Quoting: "We had far too much silver on hand and finally the government realized we didn't need 30 ounces of silver per many woman and child in the country so they dumped it. And that's a giant reason silver has been so cheap for so long."
Quoting: ..."There is no shortage and never has been". ..."a higher price caused by a lack of supply will cause people to make the decision to go back to mining. But give me one single example of anything that suggests there is any permanent lack of silver."
And this accumulation of silver, you could say, was the result of the U.S. manipulating the market upwards. You could also say this was the result of other nations of the world demonetizing silver, which created a glut of silver that flowed to those who valued it more, which was us.
Quoting:"You made that up. The US was paying $1.29 an ounce only for US mine produced silver."
In January 1980, when silver hit $50, there were lines all outside the silver shops, both buyers and sellers. The buyers line usually far exceeded the seller line, or so they tell me. Sometimes, a shop would run out of silver, other times, they would run out of cash, the volumes were so huge. If they ran out of silver, they'd have the silver sellers step to the front of the line.
Yes, silver did come out of the woodwork in 1980, and much old silver coin was melted. How much? I suppose it was 200 million ounces in a year? I do know the refineries got backed up due to this, and that payments could not be made fast enough. So, net, there was more selling than buying.
Who cares about refined silver, you ask? Any industrial user. They need the refined stuff. Silver in the ground does them no good. They not only need it refined, but also delivered to their factory. And you think I need an econ 101 lesson?
Quoting: "I just went to my coin store that I go to every Saturday. I picked up about 50 ounces of silver in the form of silver flatware below spot. So much for any mythical shortages. And it isn't refined. It's sterling flatware. But if Kodak wants to make film or Apple needs some refined silver for soldering, my silver (non-refined) is available. At the right price of course. I didn't say anything about silver in the ground but I'm thrilled that you actually admit there might be a few ounces of silver still left in the ground. But all those billions of ounces in India and China, they, too are still available.. to Kodak or Apple. At the right price. Refined or not."
India. I know about India. I addressed that in my article. India, you say, could sell silver. I agree. They could. But today, they are not, they are importers. Net importers of silver are not exporters of silver. Again, you say I need to study econ 101? Let's count India as an exporter on the day they become an exporter, and not before, ok?
Price does not prove that silver is abundant. Price proves that the silver coming to market is currently meeting current demand.
"The lowest price for silver in 5000 years (in Nov of 2001) and you don't think price tells you silver is abundant. Excuse me, what price would tell you silver is abundant?"
Price says that silver coming to market is coming to market in an uneconomic way. IE, three ways: 1. byproduct mining, 2. Inheritance selling, 3. government selling.
Price does not disprove the shrinkage and very small size of existing refined supplies, which are dwindling due to investor selling and government selling, which is helping to create the uneconomic price.
Finally, if I'm wrong on one point, no, it does not disprove all other points I may say. And no, I'm not wrong on a single point so far.
Quoting: "Excuse me. Let me go back to your original thesis. Here's what you said."
So, here are the two most bullish factors affecting silver..
1. The world has nearly run out of silver.
2. The nations of the world have printed up nearly unlimited amounts of unbacked paper money.
Quoting and Paraphrasing: "You haven't shown a single fact" to back up point 1. Your claim "is made up of two different assumptions." "Price alone tells you there is abundant silver above ground and economic geology tells you there is lots of silver left in the ground at the right price. (If the thousands of closed silver mines didn't already give you a clue)"
Quoting:"And as to point 2. It is one of those statement which is both perfectly true and perfectly meaningless at the exact same time. To suggest that it's a bullish factor affecting silver also tends to suggest that it doesn't affect anything else or it affects silver more. Not so. Yes, all currencies are about to find their real intrinsic value but it will affect gasoline, cigarettes, booze, nails and silver exactly the same. The only hope for silver as a special investment is that government replace their worthless currency with something of value. Which silver and gold are quite useful for."
Let's get back to 1980. Back then, many people were panic buying because many thought the dollar was going to go the way of the German Reichsmark.. Their fears were justified, there was a precident for that. Although it did not happen, much of the excess creation of dollars was burned off. Back then, by the time of the peak, there were only 10 times as many dollar printed up as could be backed by the U.S. official gold.
Today, there are 91 times as many dollars in M3.
But if the dollar crashed completely in 1980, the price would have been ten times higher than $50/oz. It would have hit $500/oz. Today, if we adjust for the money that has been created since then, the price might be up to $3000/oz. for silver.
And in such a situation, when there is true panic selling of the dollar as it is being destroyed, demand for silver (and gold) will exceed demand for dollars, because everyone will be waking up to the fraud of what dollars are, all at once.
...
Quoting: "If the dollar goes to zero, it isn't silver that goes up. It's the dollar going down and any price is meaningless because every other commodity will also go up. The dollar going down isn't the same thing as silver going up. Silver is a good investment if for no other reason than it's cheap."
Quoting: "You need to determine if you want to learn more about your trade or succeed merely by telling people what they want to hear. Ted Butler is quite popular as is Bill Murphy. But if you examine what he says, or what they say, they don't actually ever say anything that you could make money on. There a time to be buying silver and a time to be selling. "
Quoting: "Butler actually once suggested that it was going to be so valuable that you should never, never, ever sell. And for the life of me, I can't understand why the few honest advisors around didn't call him on it. How in hell can you profit by buying anything and "never, never, ever selling?"
Quoting: "You don't actually know enough about either silver or economics to be preaching to others. Don't confuse popularity with honesty. They aren't the same. Parroting others is not the way to success. I can poke holes in 98% of what you have to say."
Bob
=====================
My fourth reply to Bob:
You poke "holes" in what I'm saying when you redefine the subject, and twist my words. I was very clear in my article that I was speaking about refined silver, and you tried to include silver in the dirt with that.
We can speak about the coinage, and government ratios in general, but yes, things change at certain dates. The ratio was 10:1 over 100 years ago, and then 15 and 16:1 for a long time. When the U.S. government changed the gold price, and made owing gold illegal, things also changed. With the dollar at $20/oz, and with silver having about .72 to the dollar, that gives a different ratio (14.4) than when gold is at $35/oz. (25.2)
But government buying of silver to excess and dumping still does not mean there is plenty of silver around today. That silver is sold by the U.S. government, would you not agree?
I really don't know what you are saying when you write, "But give me one single example of anything that suggests there is any permanent lack of silver." I gave you 8 sources that say we are running out of above ground refined silver. What more do you want?
Of course the world can produce exactly as much silver as it wants, it all depends on how much effort and work society wishes to expend to get the silver. IE, it depends on PRICE, which is exactly my point. Today, the price is too low to have abundant silver. Today, with the price so low, we are both running out of above ground supply, which will create major shortage problems, more than we have today. We do have shortages today, because there are position limits on paper longs at the COMEX, 1500 contracts, or 7.5 million ounces. We also have delivery limits that are much, much smaller, but rarely invoked. 1.5 milion ounces.
You admit the price is too low. A too low price ALWAYS results in shortages. A too low price can never create abundance and plenty. This is econ 101. We have shortages today. You may be able to buy a single silverware set here and there (especially because silverware is unfashionable today and old people who own it keep dying), but you cannot go out and buy a billion dollars in silver. It was reported that someone wanted to buy $40 million in silver, and could not find any. I believe it, because I tried to contact many silver sources available, and I confirmed it. I could only find 5 coin dealers in the U.S. with over 100,000 ounces. JM will not sell to the general public, and occasionally, runs out, and gives the dealers a "6-week delivery" delay. Delays are shortages!
There are also delays at the COMEX if you go there to buy in quantity. But there are limits, which are also shortages.
ECU tried to go to Penoles to get a million ounces of silver. Penoles balked, because Penoles pre-sold silver for 2 years.
If you don't understand that limits and delays are evidence of shortages, I cannot help you to understand anything.
There are shortages for large buyers. Not for a tiny player like yourself. Why can you get some? The answer is in the stats. There is still net investor selling, which is meeting demand. Meaning, more investor selling than investor buying, and the excess sold still goes to the refiner.
But if you wait for the net investor selling to all turn into buying, and then you decide to buy, it will be far too late!
There also are shortages for buyers like me. I tried to buy a tiny $100,000 of silver, from 3 dealers at a time. I spread the orders out, because I wanted to protect against default. I contacted the largest coin dealers I knew of, with the best prices, and NONE of them had inventory in hand. They ALL bought from someone else. This is why I went on a crusade to find who had 100,000 oz of silver, in hand, in the dealer community, because I know there are shortages, and there will be delivery defaults.
I met a guy who 'regularly buys' silver from a dealer in Auburn, CA. Wonderful. He does not see a shortage. But the dealer there rarely has more than $1000 in silver bullion around. For a small fry, that's fine. For for me, that's not even enough to get in the car and drive there to get!
I know of many dealers around the Sacramento/Tahoe/Reno area. Many in sacramento, perhaps 5-6 in the phone books. The largest in Sacramento rarely has more than 3 bags available. In Grass Valley, I'd be lucky if my local dealer chanced upon a bag. In Reno, there is a guy who might have up to 5-10 bags. Who cares! That's all nothing. NOTHING! They might as well have none considering a big player, and really none considering the size and value of housing. Tahoe has $10 million mansions all over the place. Even the largest dealer in the bay area, in the richest neighborhood in the nation, Atherton, has less than 100,000 oz. of silver in inventory.
There is not a single dealer in all of northern California who has inventory on hand, who could handle a $500,000 order of silver bullion. I know because if there was one, they would have contacted me, and I would have found them by now. This is the current state of affairs, and it's true facts and statistics.
Did you know that investment rarities, who employs Ted Butler, does not even have 100,000 oz! That's the real story! And, they chage a HUGE mark up on silver bullion. Their prices far exceed any other price in the industry. They hype it up and then [charge] their customers with a 10-15% premium.
Also, kitco, another huge dealer of whom I know you are aware, does not [regularly] have 100,000 oz. of silver. They say they can get it [but I'd rather order from someone who has all the silver I wish to buy].
...
Looks like we both can always learn more about our trade. That's the purpose of discussion sometimes, isn't it? Thanks for the discussion.
=========================
Bob's fifth reply to me (he replied between my comments, which are repeated):
...I was very clear in my article that I was speaking about refined silver, and you tried to include silver in the dirt with that.
Quoting: "Talking about refined silver is Ted Butler bull---. At least invent your own bull----. There is a bunch of silver above ground and it simply doesn't matter if it's refined or not."
...
But government buying of silver to excess and dumping still does not mean there is plenty of silver around today. That silver is sold by the U.S. government, would you not agree?
I really don't know what you are saying when you write, "But give me one single example of anything that suggests there is any permanent lack of silver." I gave you 8 sources that say we are running out of above ground refined silver. What more do you want?
Who cares about "refined silver." Quoting: "Give me a single source which indicates there is any shortage of silver. Price proves beyond any doubt there is no shortage of silver. Period. It's the lowest price in 5000 years and you think there is a shortage? How did you pass Econ 101 with logic like that?"
...
You admit the price is too low.
Quoting: "I never said anything about price being too low. By definition, price dictates both supply and demand. Price can't be too low. I think that today's prices will go up but if you are looking for the real world evidence of silver running out, it doesn't exist."
...
If you don't understand that limits and delays are evidence of shortages, I cannot help you to understand anything.
Quoting: "Price is far more important than imaginary shortages. Price tells you if there are shortages. I have two 1000 ounce bars. If there was any real shortage, bigger bars would carry a bigger premium. Pick up the phone and get some quotes on silver in 1000 bars. I'll bet you can't find anyone who will give you spot less $.50 an ounce. What happened to the shortage. I doubt you can find someone to buy them at any price. It's not price which is too low, it's a lack of buyers."
Bob
=========================
At that point, I stopped responding. It was clear to me that Bob was ignoring the evidence I was presenting about the shortages, and that he was focused only on price, as if a low price proves there cannot be a shortage. But we just saw silver double in price from $4.15 about a year ago to over $8.40, while investor selling still overwhelmed investor buying. So, in my view, even Bob's "evidence" of a low price is wrong. We have seen a major price rise of over 100% confirm the shortages. The only reason I see for the decline in price from $8.40/oz. down to just below $6/oz., is that investors, what little investors there are, are sometimes timid, and that many weak and unsure longs have been shaken out. Also, many investors these days chase momentum, and they bought as prices moved up, and then sold as prices began to move down.
It is clear to me that the reason silver remains low is that most people remain uninformed, and that they do not understand the story in silver. Furthermore, it is clear to me that I should present the facts all together in one place so that they are easy to read, and confirm, by investors.
And I will work to present that next week.
As for Bob's assertion that I would not be able to find anyone willing to buy 1000 oz. bars for better than $.50 under spot... Well, if Bob wanted to sell, he should have called me! I have done my research for my readers, as I present a link in three places in this report to a list of bullion dealers. I have several dealers listed who have over 100,000 oz. of silver, and I also have several dealers listed who have good bid/ask prices, or a narrow spread. Here are several bids on 1000 oz. bars, at 6:30 pm on Wednesday, when Silver closed at $5.87/oz.
http://www.wexfordcoin.com/BullionBar.htm
bid on 1000 oz. bar: $5,789.87 (This is 8 cents per ounce under spot.)
http://www.bulliondirect.com
bid on 1000 oz. bar: $ 5900.00 (This is 3 cents per ounce over spot.) --a bid of only one bar. The next bid, for five bars, was
$5800, or 7 cents under spot.
There are also, of course, the industrial users and large bullion banks who will buy 1000 oz. bars.
-------------------
I will be speaking in Idaho at the Silver Summit in September 23-24
http://www.silverminers.org/summit/index.html
-------------------
Some people have suggested that I contact Coast to Coast to try and be a guest on the show. I have. Please contact them if you would like to hear me on their show.
http://www.coasttocoastam.com/info/guestrequest.html
-------------------
SAFES: Need a safe to store your silver? Steve Miele in Grass Valley at the Sports & Swap shop can deliver a safe anywhere in the U.S., and can have a safe custom built to your specifications, such as to hold silver bullion. Call Steve at (530) 272-4179. If you get a very large, refridgerator-sized, heavy safe, in excess of 1000 pounds, you have to have it delivered to a local loading dock or Freight dock, and then arrange delivery from there, which is a bit complex, because you may need to hire several people at such a freight dock to operate a fork lift. (Sorry, I had the phone number wrong last week.)
-------------------
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------------------
General Commentary on Silver (slightly modified from last week):
Now, I think it's time that the silver community started a letter writing campaign to the editors of newspapers around the world, to tell them about silver. The following links contain email addresses for hundreds of different newspaper's "letters to the editor"
http://www.awolbush.com/papers.html
http://www.results.org/website/article.asp?id=428
http://www.waronfreedom.org/activists/emleted.html
http://www.goldismoney.com/editorsemails.html
This final link lists the email addresses for about 200 world newspapers, and about 100 U.S. newspapers, so you can email them all at once. You have to copy the list, and paste it into your email, and there are direct instructions on tips for submission of letters to the editor. Most editors, most papers, want letters of 250 words or less, and many also want your full name, address and telephone number. So the task is easy. But if 500 people write letters on the silver market to about 300 newspapers around the world, I believe wonderful things will happen.
Here is a sample letter:
May 21, 2004
Dear Editor,
I'm a silver investor. I believe paper money is fraudulent. There is over 30 trillion dollars, U.S., worth of bonds in the world, but less than 2 trillion dollars worth of gold, according to gold.org.
As of April, 2004, the size of M3, the money in U.S. banks, has reached 9.1 trillion dollars, yet due to fractional reserve banking, the total of U.S. currency and coin in circulation is only 724 billion dollars as reported by treas.gov.
At silverinstitute.org and cpmgroup.com, they each report that silver has been in a deficit for about 15 years, where world mine supply has been about 500 million ounces, scrap supply about 200 million ounces, and industrial and jewelry demand about 800 million ounces. The difference, about 100 million ounces, has come from investor and government selling, drawing down reserves of silver. Known supplies of refined silver are down to about 250 to 600 million ounces. At the COMEX, they are down to 48 million ounces of silver left that is registered for delivery, which you can see at nymex.com.
The governments of the world are printing up too much paper money, and the world is running out of real money, silver. I believe this will lead to the price of silver rising dramatically in value, around the world.
I urge your readers to verify the statistics I have provided, and to make their own decisions.
Sincerely,
Jason Hommel
Grass Valley, USA
Goldismoney.com
(530) 274 3450
When I sent out my letter above to that list, I received about 70 "undeliverable/delivery has failed" messages. I sent it BCC, or "blind carbon copy", which means it may be interpreted as spam. It may have had more of an impact if I sent out my letter to each address individually, but I just didn't have the time to do that this week. Maybe next month.
I also did not include my full address, which some editors require. But I'd rather keep a bit of privacy in that regard.
------------------
I wrote an article:
Miners to Use Silver as Cash - 27 November 2003
Apparantly, I was about 6 months too early in my predictions, but that's ok, I'm a very long term thinker and investor. I did not miss the mark by too much time, and if you think in terms of decades, I was right on the mark.
There are several companies that are increasingly deciding to hold their cash in the form of silver bullion. These companies are:
SSRI SSO.V (SILVER STANDARD RSC)
SRLM.PK (STERLING MINING)
NPG.V NVPGF.PK (NEVADA PACIFIC GOLD)
EDR.V EDRGF.PK (ENDEAVOUR GOLD)
------------------
The Silver Valley in Idaho is bringing back the use of silver as money. A silver one-ounce coin, a "Sterling" to be used as a $10 piece.
http://shoshonenewspress.com/index.asp?Sec=News&str=2869
------------------
The sponsors of the Sound Money Bill in New Hampshire are now looking for donations so they can take this to other states!
For news on the New Hampshire Sound Money Bill, that proposes to use U.S. Treasury minted Silver Eagles and Gold Eagles as money see:
http://www.goldmoneybill.org/
Current status of the NH bill:
The bill will live until the November elections. It'll have a different #,
but we now have 6 months or so to get EVERYONE we need on board.
Now looking to raise $25,000 to $35,000 for "phase II", to get set up with an office and staff training..
Looking to raise $500,000 for "phase III", to take this to about 5 other states.
Send any donations you can, to:
[These are not political campaign donations.]
SOUND MONEY FOR AMERICA,
c/o Henry W. McElroy,
15 Iroquois Rd, Nashua, NH 03063
ANY AMOUNT, ANY LEGAL TENDER CURRENCY - U.S. OR FOREIGN !
Video copies of the sound money bill press conference are available for a $35 donation.
For more info, contact
Rep. Henry W. McElroy, NH State Representative
Sponsor of the bill
603-233-5892
Harvey Wharfield
978-635-9586
We also need assistance with the following.
1. Please contact your local representative to your state government. Find out whether they might support a similar "sound money bill" in your own state.
To contact your state rep to the federal goverment, see http://www.house.gov/writerep/
To contact your state rep to your local state government, you will have to find that on your own. Try searching for "contact state representative california" and replace the name of your state in the search.
2. If you know of any local representaives to your state government, who may be GOOD, LIKE MINDED REPRESENTATIVES, SENATORS, and GOVERNORS, who may like to support, or sponsor, a sound money bill in your state, please tell them about the NH initative. Copy the above, and send it along to them. And call Henry W. McElroy or Harvey Wharfield, and let them know of the other reps who may assist the cause.
3. If you have an email list to people who may be interested in gold and silver as money, or who may be good conservatives, please send out this notice to the list, so the project can move forward!
--------------------------
There are two excellent annual silver surveys that are sponsored by industry.
The survey by silverinstitute.org costs $195, 87 pages.
http://www.silverinstitute.org/wssum03.pdf -- 8 page free summary of last year's report.
The survey by cpmgroup.com costs $150, 162 pages.
http://www.cpmgroup.com/SSpress2004.pdf --3 page press release.
The two reports present the case that about 500 million oz. of silver are mined each year, about 200 million oz. of silver comes from scrap, and about 100 million oz. of silver comes from investor dis-hoarding, either by individuals or government sources, in order to meet the annual demand of about 800 million oz. of silver by industry & jewelry. This is wildly bullish, because investors are net selling more than buying, and I think the potential of investor demand is huge, and can be measured by seeing how much paper money there is in the world.
--------------------------
Here are two U.S. Government produced reports on silver, containing data on years from 1900 to present, on U.S. & world production, and U.S. consumption, and U.S. industry & government stockpiles.
Report #1
http://www.goldismoney.com/ssr/USsilver.xls
Report #2
http://www.goldismoney.com/ssr/USsilver2.xls
I evaluated these government produced reports in my silver stock report #36.
In sum, we are running out of silver. The U.S. government had over 3 billion ounces of silver in 1940, and today, has very little left, or none.
--------------------------
The Commodities Futures Trading Commission
The CFTC report on the allegations of manipulation in the silver market -- 9 page report
The CFTC report confirmes much of the research above, and almost outlines the bullish case for silver!
--My comments on the CFTC report ar in silver stock report #34 & #35
--------------------------
Silver consumption, per capita, in the U.S. is the same today, in 2004, as it was in 1945.
And what is the per capita consumption of silver in the U.S. today? 5500 tonnes x 32152 = 177 million ounces of silver used per 285 million people. 177 / 285 = .62 oz. silver consumed per year, per person, in the U.S., whether in 1945, or in 2004. Each person in the U.S. today, on average, uses 6 tenths of an ounce of silver.
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See my article: Biblical Guidelines for Managing your Money
As the New York Times, January 11, 1859, page 2 said---
"It is well known that the most colossal fortunes the world ever saw have been based on silver mines..."
--quote found by Charles Savoie
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WHERE and HOW to BUY SILVER BULLION
http://www.goldismoney.com/buy-gold.php
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My 2004-2009 price predictions for gold and silver:
2004: $595/oz. gold, 50:1 ratio = $12/oz. silver
2005: $1011/oz. gold, 30:1 ratio = $34/oz. silver
2006: $1719/oz. gold, 10:1 ratio = $172/oz. silver
2007: $2923/oz. gold, 5:1 ratio = $ 585/oz. silver
2008: $4,969/oz. gold, 1:1 ratio = $4969/oz. silver
2009: $8448/oz. gold, 5:1 ratio = $1698/oz. silver
2010+: infinity dollars/oz. gold, infinity dollars/oz. silver.
I calculate the gold price rise by guessing that by 2009, M3 will have a "gold-value" like it did in 1980, which is to say, M3 was worth 2 Billion oz. of gold or less. It also assumes M3 will about triple in that time. These figures are conservative, because I see no reason that M3 should be valued more than the gold the U.S. actually holds, which is a mere 261 million oz., not billion. Today, the M3 value is $8870 billion / $425/oz. = 19 billion oz. of gold M3 could buy in theory. The silver:gold ratio is also a very, very vague guess, reflective of monetary demand chasing silver, which is more scarce than gold in above ground, refined form. I have no idea when the ratio of 15:1 will be exceeded, I'm just totally guessing. I suppose it could happen this year or next month for all I know. Of course my real price targets are infinity dollars per oz. for both gold and silver when all is said and done, I just don't know how long that will take, nor what year it will be. But my point in producing the price predictions is to show my bullishness for silver and gold.
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I wrote an article predicting that Silver Companies will buy silver, and urging Silver Companies to buy silver with their cash, to use silver as money, and sell silver as needed for expenses. See http://news.goldseek.com/GoldIsMoney/1069879327.php
That article is now having an effect! It is being discussed by several large "cash rich" silver companies, who are seriously considering the idea of holding their cash in the form of silver.
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A great overview on silver: Douglas Kanarowski's 78 Approaching Forces For Higher Silver Prices
See also Douglas Kanarowski's article: What Impact Will Digital Photography Have on Silver?
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See the 600 year silver chart to see how undervalued silver really is:
http://goldinfo.net/silver600.html
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Look at the summary of the world silver survey by GFMS Limited on behalf of The Silver Institute :
http://www.gfms.co.uk/Publications%20Samples/WSS03-summary.pdf
Note, there is virtually no monetary nor investment demand. Note, the 2002 mine production (585 mil oz.) is greatly exceeded by industrial, photo, and jewelry demand. (838 mil oz.). Note the chart on page five, "Supply from above-ground stocks".
The difference between mine supply and industrial demand was met by a combination of three factors: 1. Government selling, 2. Private selling, 3. Recycling
U.S. government selling is ending, as their stocks have run out, or will run out. This factor will reverse, because the U.S. government will need silver to continue their coin program, and/or need silver when they wake up and decide they need to replenish their strategic stockpile for domestic security. Silver is a war material. China's selling of silver will also likely turn into buying, as China will need silver for continued industrial development, or when they also lose faith in the U.S. dollar.
Private selling has been rapidly shrinking and is now almost ended, and should turn into buying, and become monetary demand. Monetary demand is everything in the silver supply / demand situation. It's not now. Now, it's nothing. But it will become something incredible, because the dollar is dying.
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The following is a "must read": Ted Butler's best ever explanation of how silver is manipulated lower than it should be.
http://www.investmentrarities.com/11-04-03.html
Over 3400 people have signed the silver petition to stop the manipulation at the COMEX:
http://www.PetitionOnline.com/comex/
Ted correctly points out that a lower price creates excessive demand from consumers. However, Ted Butler does not point out, and neglects to mention, that a perpetually low price also creates lack of demand from investors who are "trend investors".
I think most silver experts over-analyze all the supply and demand factors of the silver market. No factor is more important than monetary demand. The force of photographic demand is like a light breeze compared to the hurricane or tornado of monetary demand. Monetary demand is everything.
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Consider the gold market for a moment: Even short selling at the COMEX is nothing compared to monetary demand. The short position most certainly helps to depress the price of gold as the short position is growing larger. However, it adds fuel to the fire if there is short covering, and thus, it can boost the gold price later. But the commercial short position on the COMEX is next to nothing compared to the non-reported "over the counter" trading that is done that does not appear on the COMEX.
(Numbers in metric tonnes, 32,152 oz. per tonne.)
870 tonnes -- the paper position at the COMEX, 280,000 contracts for 100 oz. each.
5,000 tonnes -- the official number admitted that the central banks have sold.
15,000 tonnes -- the number GATA research shows that central banks have sold / or leased.
30,000 tonnes -- the number of official central bank gold, minus either the 5000 or 15,000 tonnes.
145,000 tonnes -- all the gold mined in the history of the world.
2,600 tonnes -- annual mine supply
4,000 tonnes -- annual demand
And all of that is nothing compared to the amount of dollars out there that exist that could buy gold. $20 trillion bonds, $9 trillion M3 = $29 Trillion. A mere 1% is $290 Billion, which, at $500 /oz. is a massive demand of 18,039 tonnes. Do you understand what that means? That means that far, far less than 1% of dollars, in either bonds or M3 can buy gold, because there simply is not that much gold available.
Long before 1% of U.S. paper dollars tries to buy gold, gold will be going up well over $1000/oz., and silver will be headed up over $50/oz.
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To scare away investors--that is the entire reason gold and silver are manipulated in the first place. Only the trend investors can be deceived. The problem is that nearly everyone is a trend investor. So few investors understand value. If people knew the facts and used their brains, the available above-ground refined silver would be gone by tomorrow, and the price would be well over $20-50/oz. But don't trust me, check the numbers and follow the links:
"The money chart"
1,000,000,000,000: 1 Trillion dollars
1,000,000,000: 1 Billion dollars
1,000,000: 1 Million dollars
$45,153,000,000,000: U.S. Household wealth, as of first quarter, 2004. (Includes Real Estate, and investments)
$33,000,000,000,000: World bond market, yr end, '01: http://tinyurl.com/vr7u
$26,400,000,000,000: World stock market, June 2002: http://www.nyse.com/press/1044027443845.html$20,200,000,000,000: U.S. bond market, yr end, '02: http://tinyurl.com/vr7g $11,447,800,000,000: U.S. GDP, 2004 q1 http://www.bea.doc.gov/bea/dn/home/gdp.htm$11,300,000,000,000: NYSE U.S. stock market, April, '04 (363 bill/s x $31.14/s ave.) http://nyse.com (See: Market info: quick facts) $9,101,000,000,000: M3 (money in U.S. banks) April, '04 http://tinyurl.com/vra0 $7,183,392,668,476: US debt, 5-18-04 http://www.publicdebt.treas.gov/opd/opdpenny.htm $2,360,000,000,000: U.S. annual budget 2005 http://tinyurl.com/3xbd2 $2,572,160,000,000: Marcos/Phillipine "black/unofficial" gold: 200,000 (to 500,000) Tonnes @ $400/oz. (Book: "Gold Warriors") $1,860,000,000,000: World "official" gold mined in all of history, 145,000 T @ $400/oz. http://tinyurl.com/vrcc ($300,000,000,000: Estimated silver mined in all of history: 30-40 million oz? @ $10/oz.) $724,174,342,365: Total U.S. paper currency & coin in circulation, Dec. 31, '03 http://www.fms.treas.gov/bulletin/index.html $700,000,000,000: U.S. annual budget def
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