On the 23rd of July in 1965, US president Linden B. Johnston said this in the Rose Garden at The White House. "If any body has any idea of hoarding our silver coins, let me say this: (The US) Treasury has a lot of silver on hand, and it can be, and will be used to keep the price of silver in line with its value in our present silver coin. There will be no profit in holding them out of circulation for the value of their silver content." Perhaps today US treasury gets certain US banks to do that same dirty work for them !
That was back in 1965, different people, different economy. I can't speak for the other nations of the world but in the U.S. a lot of people even question whether we have any gold reserves left much less silver. China it seems has had the largest appetite for silver but I don't know if that was for commercial or government interest. The only threat I would see is if several key industrialized nations heeded to overwhelming pressure by their citizens to return to a hard currency containing at least 50% PM content whether it would be copper, silver or gold. It would probably be good for us initially but if it happened here I would think it would drive silver into the ground. I'm no expert on economics, it's just my opinion.
Perhaps in 1965 government thought they could control markets. But in 2012 not even governments can hope to beat the speculators in metals, currencies, equities, treasuries etc etc. The markets are just too big, totally international and government attempts to affect price through buying/selling cant defeat international financiers.
In the last sentence of my initial post, I questioned whether someone else (large international financier) may be doing it for them.
The US Government did suppress the price by liquidating all it's Physical Silver holdings as well as it's military strategic reserves Now it supposedly just shorts the paper via JPM They have fired every shot they can so I would say that statement no longer has any validity
As I understand it, part of the value of any precious metal is its availability. The more available it is the lesser the value. Also, hard currency containing a reasonable amount of PM's restores faith in that governments money and people will want to buy less bullion. There will always be its commercial value but with less people feeling the need to hedge their bets the prices I think would go down.
I don't get your reasoning on this. Care to explain further? Seems to me the opposite should/would occur.
we are after all heading for a cashless society that's the arrangement who is driving this the big wankers why so they can make more money if people think Julia runs this country they are sillier than her she is what i think they call a talking head
Sorry I somehow missed your previous reply. My bad. I see what you are saying I think. As more PM's would be required to mint for actual currency it would increase the availability as stockpiles are drawn down to facilitate this. Hmmm. On the flipside the actual demand for such PM's would increase. Don't forget it's availability is still constrained by physical limits.
I agree with you boyracer but if the U.S. or the E.U. were to go to hard currency the other major industrialized nations would have to follow suit almost immediately or see their fiat currency become worthless overnight as everyone would be demanding USD's or Euro's. Demand would increase, the mines would be cranking out silver to meet demand, silver and copper and gold would be more plentiful in the open market while stackers would be waiting to purchase ounces that they may never get to see because of all the government contracts. The first price dip that comes along and alot of people will probably start dumping their ounces because they no longer possess something that most people did not own. Again, my knowledge of economics is limited but I think that there may be some validity to statement.
That might actually be a benefit rather than a hindrance. I'm far from an expert in these matters myself (who is really). Law of Unintended Consequences sums up your post I think. Your point about others being forced to follow the US/EU as a first mover is a good one. One in all in so to speak. Most things I've read about the issue are that going to PM's as currency would drive the price up to da moon etc. Is interesting to see some contrarian thinking.
Now that you mention it, I guess I am looking at it from the point of view of the law of unintended consequences. Well stated sir.
