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The U.S. Government can't stop Silver Fraud

By: Jason Hommel, Silver Stock Report

-- Posted 16 April, 2009 | | Discuss This Article - Comments: Source:

(But you can!)

Silver Stock Report

Many people who have been taught all their lives to have faith in the U.S. Government expect the government to stop the many silver frauds taking place.  Let me explain why that can't happen.

The U.S. government is supporting the fraud of the dollar.  The "working group on financial markets" also known as the "plunge protection team" consisting of the President, the Secretary of the Treasury, and perhaps the heads of the CFTC and SEC, are actively working to suppress the silver and gold prices by encouraging the leasing of gold from central banks around the world. 

Those people who are working to suppress the price of silver, cannot be expected to simultaneously raise the price of silver.

But on a more practical level, what can the government do, really?

Can the government pass a law saying that people cannot store silver for other people?  Not seriously, no.

Can the government pass a law saying that whoever stores silver for another person must open up their vaults to periodic government inspection and audits?  Again, no, the notion is absurd.

And ultimately, can the government pass a law saying that people cannot borrow silver from another person?  Again, no.

As much as I hate to borrow and lend, when I replace silver in my own silver sales business, I order silver from other businesses, and in between the time when I place my order, and when I get my silver, there is, in effect, a silver "loan" in place, as, in theory, they own "my" silver. 

The government would have an easier time banning all credit cards or home mortgages than they could effectively regulate the rampant silver lending fraud taking place.

The government can do nothing.  The government will do nothing. 

This is not a political problem.

It's a moral problem. 

People are trusting entities that do not deserve to be trusted.  And because they are doing that, they will get what they deserve, which is nothing. 

No discernment and no wisdom will eventually equal no silver.

People need to have discernment, or the ability to understand that trusting bankrupt banks and bailed out brokerages to hold their silver for them is not very smart.

If the study of the free market has taught me anything, it's that we cannot trust any kinds of government programs or solutions to solve any of the world's problems.  If the government tried to regulate the silver market, they would just make things worse than they already are.

In fact, I believe that the aura of "government regulation", the very concept of the existence of the CFTC, or "Commodity Futures Trading Commission" provides a false aura of safety where none exists, and makes the problem even worse now that it would otherwise be.  Thus, a key problem is that people trust that the CFTC is preventing manipulation.

In actual fact, its worse than that, since the CFTC is actively working to aid the short side manipulations in the market, and has always worked to prevent accumulation of silver by large and wealthy investors on the long side of the market.

So, what is the conclusion and solution?

First, it's a waste of time to think that the government can stop the fraud taking place.  It is a waste of time to ask someone to listen, who is actively telling you that they are refusing to listen.

Second, it is important to understand the source of the problem, since the source of the solution cannot be the government.  The source of the solution is the market. 

People will eventually realize the silver fraud.  They will slowly wake up, and then ever more quickly wake up, and demand to take delivery of, and buy, real tangible, heavy, physical, silver.

Third, instead of wasting time working for a government solution, people should spend time working on the free market solution to the problem. 

Examples on how to solve the problem:  Start a business.  Sell silver online, or open up your own coin shop.   Sell only a small portion of your silver at a time to avoid the large risk of a silver delivery default from destroying your own capital.

Exercise the discernment to learn which silver suppliers to trust.  Trust people who can deliver silver fast, at good prices.

If you waste time on government solutions, you will get nowhere, or cause even greater problems than there were before.

If you spend time on free market solutions, you will be successful, and make money in the process.

Now, I'm not saying that the U.S. government cannot be run by enough honest people who will work to re-introduce sound and honest money.  One day, I believe it will.  But just not today.  It's a moral problem.  Enough people need to have much better morals before that will ever happen.  It may take a generation, or, if we are blessed, a short decade of hard times before people wake up.  Because they sure didn't do it when they were wealthy in paper money.

Furthermore, this is mostly a problem with the U.S. government.  State governments, or other foreign national governments are much more likely to consider issuing silver and gold as money, long before the U.S. returns to using silver and gold as money.

That's why I wrote:

How any government can issue silver as currency  March 17, 2009


    Jason Hommel

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    -- Posted 16 April, 2009 | | Discuss This Article - Comments:

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