-- Posted 30 November, 2006 | |

The Wallace Street Journal

By David Bond, Editor

Silver Valley Mining Journal

Stein-am-Rhein, Switzerland – The Rhine is a crystalline shimmer of turquoise and azure, flowing sedately from Lake Constance, its population of giant German browns casting dark shadows on the riverbed, feeding lazily off a bottom-hatch. On the opposite bank, high above the clock towers and medieval homes of this 1,000-year-old village glowers the imposing castle at the end of a winding one-lane stone road begging for a Porsche to attack it. The trees in this northern Switzerland hamlet are just turning their autumn colours. There’s not a breath of wind.

We drink in this view, and another sip of locally-brewed Adler beer, our fingers poised at the keyboard, awaiting our internet connexion, thinking: Even Bill Gates could not screw up a morning like this. It is the perfect morning to surf, and to write. And you’re right. Bill Gates could not mess up a poised moment like this. But Swiss Telcom did, dropping from internet DSL service everyone on their grid, which was most of northern Switzerland. Damn! Taken again. So we are left with only the company of great friends, the rustle of the Rhein, the sunshine, the German browns, the squawking waterfowl, the chiming of the church clocks, the balmy mid-November warmth and the Adler beer  . . .  it turns out email can indeed wait.

Our head is still spinning from the awakening, in Europe, to the drum of the silver and gold beat. We caucus during an early breakfast at the Ochsen in Wagenhausen with a reformed Swiss bank president, former government official, next to the late Ferdinand Lips probably the most listened-to guy on that corner of the planet when it comes to asset protection, and he advises: “The economy has gone black. Even the poorest working man has 10,000 CHF secretly buried in his backyard, safe from the government’s prying eyes. The Swiss commercial banks are not backed by gold anymore; they survive only on derivatives and currency trading and bad loans.”

This is not encouraging news from this gentleman who knows the Swiss banking system inside and out. And later this very day, at a Fondue hosted by our good Stein-am Rhein friend George Stangel of www.Swiss-Silver.ch, also at Ochsen, we hear from another group of ex-pat Swiss bankers, not ex-pat Swiss, understand, just reformed cantonal bankers now in pursuit of all the silver, gold and other hard assets they can lay their hands on. And we wonder, if your money’s not safe with the Swiss, where is it safe?

Indeed, that question seems to rumble ominously as 1943 rail-gun fire across the European landscape. Whose money is safe? The Euro? Not according to the crowd at Jan Kneist’s gold and silver investment conference in Munich, whence we began this two-week, two-day visit. Jan, of www.goldseiten.de, is in his second year of a Munich silver-gold investment conference, and has wrapped in a nice bunch of gold silver mining companies, bankers and investors for this two-day event, which will hear from the likes of GATA’s  Bill Murphy and a host of corporate presentations, all in German.

(Munich is a hard-luck town. It is the birthplace of lager beer, but also the birthplace of Hitler’s National Socialists – well, a .500 average ain’t all that bad). Dachau is 7 miles outside the city limits, and some ghoul offers tours of the place. But so was the Palace of Art, and one of Europe’s most artistic and musical cities until we and the Brits bombed it to oblivion during World War II, when the Allies and the Axis fought to the death for the real estate and the gold, consigning 6 million Jews, and any modern notion of Republican Democracy, to horrible death. What the B-17s and the Lancasters launched from those grass fields in Britain missed may still be found on the Marien Platz, where the churches still sing and the old-timers still gather to shake hands and greet each other like Rotarians in the late morning, whence the pitchers of pilsner and the plates of Weiner schnitzel flow from a mammoth bar that doesn’t take plastic cards and doesn’t speak English.

(No sooner was Munich was back on her feet than in 1972 Yassir Arafat launched his long and successful quest for the Nobel Peace Prize by slaughtering 11 members of the Israeli Olympic team, and a couple of German police officers – the first Olympics Germany had seen since 1936, when Hilter’s Aryans were humiliated by a young Yank, of – horror of horrors no less – African descent, named Jesse Owens in Berlin.

(Somehow, this business does not appear to be the fault of the good people of Munchen. No, they were just caught in the cross-hairs of history, and paid bloody for it. A kinder and prettier city and its inhabitants you will not find.)

We sit down for a brief lunch-break at Jan Kneist’s show, and joining us at our table are a middle-aged Munchen couple. Retired. Knows German real estate like the back of his hand: “What this Euro is, it’s only pledges of U.S. dollars by the European banks. There’s no gold behind it, no reality. This thing’s going to crumble.”

A quick whisk to London via British Airways, and we are ensconced at the Churchill, in Mayfair township, where Nick and Fran Williams of mineserve@blueyonder.co.uk are pacing holes through the Persian carpets wondering if anyone will show up for Old Blighty’s first Silver Summit. They have worked hard and long on this, as only Shauna and I, who have put on four of these in Idaho, can attest. The hotel is beggaring them for ₤5 per cup of coffee, 100 slurpers at work and more coming. A dozen solid companies fetch up, as do the 100 invitees, not to worry. David Morgan and ex-pat Swiss banker Rolf Nef, and GATA guru James Turk, regale the one-day crowd with tales of fiat monetary failure while deals are made with shareholders, financiers, and silver and gold miners, and understandings made amongst friends who want gently out of this whole fiat paper mess.

Europe wants its gold back. The gold FDR stole at $35 an ounce, with paper, the gold Nixon could not deliver to Charles DeGaulle because the United States cheated Europe – including France, the only nation that ever repaid its World War II debt to the U.S. Some friends we Yanks were, eh? The American government has ever since tried to get the average NFL/NASCAR-watching bozo to dislike the French, but the truth is, we broke our promise to those guys, they got pissed, and somehow we are the wronged party. Sorry, my Fellow Americans: a deal’s a deal, no matter how it hurts. We reneged, and if you find the guy pouring your coffee at the Café Ponte Neuf a tad snooty, well, maybe he’s earned the right to be. Same way you’d feel about a deadbeat at the pool table.

Into that milieu the Eurostar bolts, and we disembark Gare Nord, cab it to Gare St. Lazarre, whereupon Eric LeMaire of www.24hgold.com and Bernard Siou of the Paris Silver Summit await us. Just two companies this time, as is the Paris style, and several speakers. We are served a splendid meal of salmon and rabbit at Maxim’s; the conversation is hearty. From out of the mouths of suspected Babes comes the question: Who’s messing with this market? We try to dither. No, they want to know the banks’ names. Well, there is a mining company, Barrick, and there is a bank, follow your nose . . .

Europe is in the grip of fear, as well it ought to be. The best that can be said of the CHF, the Pound and the Euro is, that it is as sound as a dollar. Or a million-mark note from the Weimar. And those poor bastards can’t even own a handgun. But they can, subject to the 17 percent VAT, own silver. And they’re willing to pay the price. ‘Tis indeed better than paper.

Roll on, Big Rhein, roll on . . .