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US Mint Issues False Statement on Silver Bullion Sourcing

By: Bix Weir

-- Posted 6 June, 2008 | | Discuss This Article - Comments:

June 6, 2008

Another open letter to:

Henry Paulson
US Secretary of The Treasury
1500 Pennsylvania Avenue, NW
Washington, DC 20220

Edmond C. Moy
Director of The US Mint
801 9th Street, NW
Room 8S23-3
Washington, D.C. 20220

RE: US Mint Issues False Statement on Silver Bullion Sourcing

Dear Sirs:

The US Mint just released a statement concerning the rationing of US Silver Eagles that stated one of the reasons for the rationing program was that the silver bullion had to be newly mined and could only be sourced from US sources.

"By law, the United States Mint's American Eagle silver bullion coins must meet exacting specifications and must be composed of newly mined silver acquired from domestic sources. The United States Mint will continue to make every effort to increase its acquisition of silver bullion blanks that meet these specifications and requirements to address continuing high demand in the silver bullion coin market."

I believe this to be a false statement. US Law: 31USC5112 clearly states:

(C) Sources of bullion.--The Secretary shall obtain silver for minting coins under subparagraph (B) from available resources, including stockpiles established under the Strategic and Critical Materials Stock Piling Act.

The US Mint is erroneously referring to the section about sourcing gold which specifies that gold bullion, and only gold bullion, is newly mined and sourced from mines in the United States:

7) Source of gold bullion.—

(A) In general.--The Secretary shall acquire gold for the coins issued under this subsection by purchase of gold mined from natural deposits in the United States, or in a territory or possession of the United States, within 1 year after the month in which the ore from which it is derived was mined.

Congress passed two laws in 2002 to ensure that the physical silver needed to make US Silver Eagles would be available to the US Mint in any quantities and from any source. These are the laws I am referring to:

Support of American Eagle Bullion Program Act
S. 2594

"An Act - To authorize the Secretary of the Treasury to purchase silver on the open market when the silver stockpile is depleted, to be used to mint coins."

Silver Eagle Coin Continuation Act of 2002
H.R. 4846


(4) with the depletion of silver reserves in the Defense Logistic Agency's Strategic and Critical Materials Stockpile, it is necessary for the Department of the Treasury to acquire silver from other sources in order to preserve the American Eagle Silver Bullion Program;

(5) with the ability to obtain silver from other sources, the United States Mint can continue the highly successful American Eagle Silver Bullion Program, exercising sound business judgment and market acquisition practices in its approach to the silver market, resulting in continuing profitability of the program;

(b) IN GENERAL- Section 5116(b)(2) of title 31, United States Code, is amended--

(1) in the 1st sentence, by striking `, except silver transferred' and all that follows through the period at the end of such sentence and inserting `or may obtain silver from other sources as appropriate.'; and

(2) by striking the 2nd sentence.

Please note the title of Section 2 of this important law “DELETION OF LIMITATION ON ACQUISITION OF SILVER FOR $1 COIN FROM ABOLISHED STOCK PILE”. I believe that the US Congress clearly does not want ANY LIMITATION on the acquisition of silver to make the US Silver Eagles.

There is no reference to silver bullion having to be “newly mined” or being sourced domestically in the US coinage law 31USC5112, but there are specific laws passed to ensure that there is NO LIMITATION on the silver bullion available for the US Silver Eagle Program. If there is another US law changing the above references please state them in a press release because it is clear that the US Congress intended US Silver Eagles to be made available to the public in sufficient quantities to satisfy all demand.


Bix Weir
US Citizen

Cc:        Michael Mukasey, US Attorney General
        A. Roy Lavic, Inspector General CFTC
        Senator Dianne Feinstein
        Congressman Ron Paul

-- Posted 6 June, 2008 | | Discuss This Article - Comments:

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