Faith-Based Currency even Atheists and Agnostics believe is Fairy tales

This article was released by Ron Paul yesterday and his plane almost crashes the next day.
"There are no coincidences, Delia... only the illusion of coincidence."
V- V for Vendetta


The Latin term "fiat" roughly translates to "there shall be". When we refer to fiat money, we are referring to money that exists because the government declares it into existence. It is not based on production or earnings, and not backed by any commodity. It is solely based on trusting the government. Fiat money is exchanged in the economy as long as there is faith in the government that issues it.
Some are blaming the recent shakeup in the markets to "whining" or financial fear-mongering, which misses the whole point. History has shown that fiat money, or "faith-based currency" always fails, because when governments claim this power, they always behave irresponsibly.

When government has the ability to create and spend all the money it wants, priorities shift, and the concept of budgeting, as most Americans know it, loses all meaning. Hand a teenager a credit card, and tell him there is no limit and no accountability for what he spends, and the effect would be the same. You see, this problem is not unique to our government. It is a predictable outcome based on human nature, and we've seen variations of what we are experiencing now happen over and over throughout history. I didn't have a crystal ball or a fortune teller when I predicted this 3, 7, or even 30 years ago. Actions have logical consequences. The government becomes the reckless teenager with the credit card, and in the end, the taxpaying citizens get the bill. What happens after that is never pretty.

This is why our founding fathers considered, but decidedly rejected the creation of a national central bank. They understood that governments, even the best of governments, cannot control spending. Even the current administration, which promised strict fiscal responsibility, has had to increase the national debt limit by 65 percent to keep up with its spending sprees. Every dollar created and spent by government makes the dollars in your pocket worth less and less. Eventually any currency controlled by government will be debased to worthlessness, and will wipe out the savings of the citizens who put faith in that currency.

Hard currencies, on the other hand, force governments to remain in check, strictly limited to the revenues they can raise from the country's economic health. This is also an incentive for government to stay out of the way of productivity. The hyper-regulation in today's economy demonstrates that this is no longer the case. What does it matter if the economy is crippled and the tax-base eroded, if government can create whatever dollars they need to keep the special interests happy?

We have been building economic castles on the sand, and the tide is coming in. The answer is not to bring in more sand, but to move to more solid foundation.

So yes, it is true that many are complaining about our economic trouble, but our economic trouble is not caused by their complaining. Many are being forced to wake up to the predictable troubles associated with faith-based currency. As more people notice the hardships, more will lose faith.

We are long overdue for a course correction and I can only hope that this awakening translates to a solid approach to currency reform. Source.

Congressman Ron Paul's Plane almost Crashes

The champion of the Constitution and the chief critic of the Fraudulent Federal Reserve; Dr. Ron Paul plane almost crashed today. Conspiracy theories are sure to swirl in the aftermath. In today's climate does it really matter if it was an accident? Today, the government is guilty until proven innocent. Why would the American Patriot not apply the same standard that the government uses on it's own populace?
People should not be afraid of their governments. Governments should be afraid of their people. V for Vendetta.

AP Article on Ron Paul

Is Blackwater being reigned in by the U.S. Military

Nothing is as it appears to be in the media. I was told about a year ago by some U.S. Military contacts that the troops would be brought home from Irag to checkmate Blackwater, which would play a large part in any NWO takeover scenario. Well the troops have not been brought home, but maybe Blackwater is being neutered a bit behind the scenes; time will tell.
Blackwater, the US private military contractor widely accused of abuse of power in Iraq, is getting out of the security business.

Company executives said they are moving away from security work in the wake of close media scrutiny of private contractors' behaviour in Iraq, particularly a Baghdad shooting involving Blackwater employees that left 17 Iraqi civilians dead. The incident is under investigation by American law enforcement.

"The experience we've had would certainly be a disincentive to any other companies that want to step in and put their entire business at risk,'' Blackwater founder and chief executive Erik Prince told an Associated Press reporter who was given a daylong tour of the company's headquarters.

Anne Tyrrell, a Blackwater spokesman, said the company has not planned any "shift," but rather that the company would grow in other areas besides private security.

"When we are seeking to expand the business we will be doing it in other area," she said. "We don't see that market growing".
Blackwater has made hundreds of millions of dollars off of contracts to guard US state department officials. Its seemingly ubiquitous presence, combined with the larger-than-life personality of the conservative Prince, turned Blackwater into an emblem for the privatised military that the Bush administration relied upon to help wage the Iraq war.

The company also operated under broad legal immunity from criminal prosecution in Iraq, attracting criticism from government officials in Washington as well as Baghdad. The US Congress ultimately passed legislation bringing contracting firms under the American military code of justice. To finish the article.

Devvy Kidd UnConstitutional Bailout of Freddie and Fanny

By: Devvy
July 17, 2008

© 2008 - NewsWithViews.com

Arthur Henning of the Chicago Tribune said back in 1935, "The New Deal will bring the Communist Party within striking distance of overthrow of the American form of government..." Mark Sullivan of the Buffalo Evening News also expressed alarm in 1935: "The New Deal is to America what the early phase of Nazism was to Germany..."



The nation is awash in fear because they are coming to realize that while they've been buying all the hype from the cabal of gangsters in Washington for decades, reality is now setting in as poverty is slamming millions who used to belong to the middle class. From dangerous lending practices to the derivatives time bomb waiting to go off and inflation getting ready to launch into hyper inflation, the situation is more grim by the week. A financial catastrophe so many have been warning about for decades, it's all coming home to roost. The "perfect storm" as it's being called. The beast is now devouring itself and we the people are caught in their cross fire.



Unfortunately, most Americans haven't been listening. They're either addicted to sports, shopping, porn, drugs or yaking on their cell phones while the world has been heading for financial Armageddon. Oh, they perk up when they hear things like how many new jobs Bill Clinton created! Clinton used to love to brag that he had created 14 million new jobs during his tenure. He did? Sure, and Mr. Jones can thank Clinton for all three of his minimum wage jobs while Clinton supported the destruction of our true and meaningful job bases: ag, industrial and manufacturing. George W. Bush has steadfastly supported the same destructive redistribution of America's wealth into the hands of foreign countries while our people go without - backed up by both Democrats and Republicans.



Still, the American people continue to vote the same incumbents back into office expecting change as they did in 2006. Nothing has changed. We tried to tell people they were being led like cattle to the slaughter house. But, since corporate media has controlled the flow of information in this country for decades, the majority remain in the dark without a clue. The Internet has been a tremendous tool, but not everyone owns a computer and too many continue to play the right vs the left.



Tragically, the majority of Americans have zero knowledge of our monetary and banking systems. Take a good look at the person in front of you at the grocery store, post office or at these rallies during this past primary 'season.' Virtually all of them will tell you our form of government is a democracy and that mother government is the answer to what's bringing us to ruin. Ignorance is not bliss. As the empty bellies in this country grow louder because families have to sacrifice food for gas, dental appointments for gas and other basic necessities, the anger and frustration will build. As their paychecks continue to shrink from more and more heavy taxation, spending will decline and the economy will not grow.



As the American people become more desperate, they will grab at anything thrown out there to save their homes and jobs. Barack Hussein Obama and Juan McCain will continue feeding them gibberish about "fixing the economy." Why, only yesterday, Obama "calls for a new stimulus package to jump start the economy." Who does this huckster think he's kidding?



Since tens of millions have little understanding of how and why we got here, they will grab the lie that sounds the best. Neither Obama or McCain have ever even whispered the only real solution to our monetary and financial crisis. Perhaps they're listening to another blithering idiot, US Treasury Secretary Henry Paulson who said last week: "...the US economy would most likely be stronger at the end of 2008, even as oil prices surged to new records above 146 dollars. "I think there is a very strong possibility that we will be growing at the end of the year. We will have stronger growth at the end of the year than we have right now."



The upside is that millions of Americans do know and understand how we came to this point. They know because, just like me, they learned from individuals like Dr. Edwin Vieira, who has been educating on this issue for over 30 years. The same as Congressmen Louis McFadden (deceased, 1936) and Ron Paul; G. Edward Griffin and too many more to list. We also know that what is being proposed regarding Freddie Mac and Fannie Mae is against the law. The U.S. Constitution does NOT authorize Congress to act as a bank to bail out corporations like Lee Iacocca's Chrysler Corporation, the infamous 'Mexican Peso Bailout' under Marxist Bill Clinton or Freddie and Fannie.



As James K. Hickel, of the Heritage Foundation so accurately pointed out in 1983: "In the case of the Chrysler bail-out, a big chunk of taxpayer money was committed to a shaky and inappropriate venture. Every American became an involuntary and uncompensated partner in a company whose future is still in doubt. On top of this, the bail-out even failed in its purpose. The precedent established is extremely dangerous."



Not only was it a dangerous precedent and in violation of the supreme law of the land, here we are 25 years down the road: "Chrysler to lay off thousands of salaried workers, cut 750 job at Ohio plant. The white-collar cuts come on top of the 13,000 layoffs Chrysler announced in February as part of a massive restructuring plan." GM has also announced huge lay offs coming. This bail out of Freddie and Fannie will not help the local economies where the lay offs happen. The situation will worsen when those workers can't make their mortgage payments and default. The states won't be able to tax at the same rates and will begin to crumble. Services in your state will be cut and those who lose their state, city and county jobs will have a hard time with their mortgages. Add the number of seniors already dependent upon the state for their very existence, including medical care and the increasing numbers of seniors filing for bankruptcy and you have a financial sledge hammer coming down on the states that's going to get ugly.



As for the Mexican Peso bail out, millions of us demanded Congress stop such lunacy, but you see, it was tied to NAFTA. The same NAFTA both the Republicans and Democrats have allowed to remain in effect for over 15 years even though it is clearly unconstitutional and has killed MILLIONS of good jobs. An excellent analysis can be found here: The Peso Crisis and Cause. The U.S. Constitution was again trashed and too few cared.



On July 16, 2008, I happened to catch a segment with Judge Andrew Napolitano on FAUX News Network's afternoon session hosted by the affable, but ignorant, Shepard Smith. Napolitano patiently tried to explain to Smith why Congress has NO authority to bail out any of these private corporations. Smith looked perplexed, as usual. Andrew Napolitano is one smart man who isn't afraid to call it like it is and would have made a first rate Attorney General under a Ron Paul presidency. Add Dr. Edwin Vieira as Secretary of the Treasury and we would have seen the first steps taken towards ridding America of her shackles to the unconstitutional "Federal" Reserve Banking System.



What Smith didn't seem to grasp, the looting of the American people once more to save stock holders of these corporations -- just what is going to be used for this latest swindle of the people's purse? The U. S. Constitution does not authorize Congress to act as a bank or loan guaranty agency. All the cable network gas bags and political pundits are weighing in on this financial tsunami with one band aid or another. Of the dozens of columns and news items I've read in the past couple of weeks, I believe the one that best sums it up is by Lew Rockwell, Fannie, Freddie, Fascist:



"Place the blame not only on the banks, but also on the institutions that are siphoning off their liabilities for irresponsible behavior, and that would be Freddie and Fannie. And who created these? Travel back in time to the New Deal. Here is an article about the creation of Freddie Mac. And here is another about Fannie Mae.



They were created by FDR in 1938 to fund mortgages insured by the Federal Home Administration. They were used by every president as a means to achieve this peculiar American value that every last person must own a home, no matter what. So they were given the legal permission to purchase private mortgages and make them part of their portfolios. Still later, under LBJ and Nixon, they became public companies and sold stock."



These crooks in Washington want to rescue the stock holders of Freddie and Fannie to the tune of ONE TRILLION dollars. That's just what these two entities need right now. Who knows what the final numbers will be? We have to remember that close to another million homes will go into foreclosure by the time the next puppet president is sworn into office. What will they "need" a year from now? Where will this ONE TRILLION "dollars" come from? July 15, 2008: Bernanke: Economy faces 'numerous difficulties'



"Bernanke's testimony comes just two days after the Fed and the Treasury Department came to the rescue of mortgage giants Fannie Mae and Freddie Mac, offering to throw them a financial lifeline. The Fed chief was later joined by Treasury Secretary Henry Paulson and Securities and Exchange Commission Chairman Chris Cox, who were summoned to detail the rescue plan. The two companies hold or guarantee more than $5 trillion in mortgages -- almost half of the nation's total. The Bush administration is asking Congress to temporarily increase lines of credit to Fannie and Freddie and to let the government buy their stock. The Fed has offered to let the companies draw emergency loans."



Where in Art.1, Section 8, of the U. S. Constitution does it authorize the federal government to buy up stock in any corporation and reward stockholders for their gross mismanagement? Where is the "FED" going to get this ONE TRILLION "dollars"? Why, they're going to create it out of thin air - the magical money machine! As I write this column, Congress has run this country into a $9,498,511,404,143.63 debt. That's just under $9.5 TRILLION "dollars." How many Americans know what "debt ceiling" means?

March 22, 2008: Congress Raises the Debt Ceiling To Accommodate Bush's Legacy



"The House fiscal 2009 budget, which passed last week, raises the borrowing authority of the United States from $9.815 trillion to $10.2 trillion, an increase of $385 billion dollars. The Senate, passing its own version of the 2009 budget, did not raise the federal borrowing authority, but does expect to spend $3 trillion, with a projected deficit from $340 to $366 billion. Some estimate that the Treasury Department will hit the $9.815 ceiling limit shortly after the November elections, which will be no surprise to anyone. The two chambers will have to reach a compromise in the next few weeks. The big winners in all of this are the foreign entities the U.S. will borrow from in an effort to finance the expenditures."



Increase lines of credit, Mr. Bush? What you're asking is to further enslave my daughter who already works two jobs just to keep afloat, to save these stock holders and entities that should never have been created in the first place. If this ONE TRILLION "dollars" created out of thin air is added to the national debt, it will exceed the current 'debt ceiling' as the interest accumulates; Congress will have to raise it again. Counterfeit U.S. Senator, Chris Dodd wants everyone to shut up about Freddie and Fannie. Could it be because this incompetent blowhard is the Chairman of the U.S. Senate Committee on Banking, Housing and Urban Affairs that recently passed another rape of we the people:



July 11 (Bloomberg) -- "The U.S. Senate passed a $300 billion plan to help thousands of Americans keep their homes and tighten regulation of Fannie Mae and Freddie Mac in an effort to ease the worst housing slump since the Great Depression. The legislation, approved 63-5 today, would let an estimated 400,000 struggling homeowners avoid foreclosure by refinancing their subprime mortgages into fixed-rate loans backed by the government. The measure also offers tax incentives to potential home buyers and sets aside $4 billion to help communities buy foreclosed properties."
For rest of the article- Source

Silver is like TNT for 5 years running

Silver Stock Report
Jason Hommel July 11th

Whenever silver prices take a dip, people lament the delay in the rise in prices and ask me "When will silver prices explode?"

Well, it's been exploding for 5 years now. In 2003, silver's low point was $4.15/oz. in the spring. This year, silver is "about" $18. From $5 to $18 over 5 years is an "average" annual gain of a whopping 29%. It may not seem like a lot because we have such high expectations for silver (along with waiting during price consolidations lasting 1.5 years at a time), but let's see what 29% gains per year really look like over the next 15 years. Most people don't seem to understand the power of compounding gains. So, I made two charts to illustrate the points.






In the second chart, a lot of people think that most of the gains come later. That's not true. This shows a 29% gain, every single year.

I would not expect such "regular" gains, silver prices will show more ups and downs than this projection.

But clearly, silver will do better than that, for several reasons, as follows.

1. Most people today are trend investors. Silver's price action so far is a good trend.

2. Silver's price action is more than justified by the fundamentals. With only about 60 million ounces of annual investment demand, which is less than 1/10th of overall annual silver demand, any newly increased investor demand is sure to have a high impact on the price.

3. Annual investor demand for silver of 60 million ounces is only about $1 billion. That is so small in the scale of world finance, it's scary.

4. More than 90% of people are concerned about rising prices and inflation, and will be looking for ways to protect their money. Silver is the natural choice, and more people are discovering silver every day. As they do, investment demand can grow substantially and quickly.

5. In the U.S., there are about 4000 coin shops that can help people find silver to buy. www.find-your-local-coin-shop.com

6. Just this year, investment demand for American Silver Eagle 1 ounce coins has doubled, from 10 million/year to 20 million. The public really got excited about silver and gold when prices hit $20/oz. for silver, and $1000/oz. for gold, with customer volumes increasing 10 times a many coin shops. Just wait to see how excited people get when silver gets past $50, and then, they realize that the inflation adjusted high price for silver from 1980 when silver was $50, is now nearing $400/oz.!

Conclusion? Don't "wait" for silver to explode before acting. It's exploding already. Get some. As soon as you can. The longer you wait, the more you will pay.

Sincerely,

Jason Hommel
www.find-your-local-coin-shop.com
www.silverstockreport.com
www.miningpedia.com
www.bibleprophesy.org

Silver Market Structure: Shortages

Silver Stock Report
by Jason Hommel, March 25, 2008

My recent reports on the Silver Shortages at Coin Shops and major dealers have been popular, and widely re-posted. Misunderstandings and questions are more abundant than my ability to answer them all individually; but most could be answered if only people and coin shop owners only understood the basic market structure of silver, and did a little bit of thinking for about 5 minutes, and then a bit of math on the numbers, so let's start with the numbers, as reported by the CPM Group and Silverinstitute. New reports for 2007 are expected this Spring, and I'd be surprised to see any category change by more than 5%, except maybe investor buying, which might be up. For 2008 reports, we'll have to wait a year. I tend to average the figures from both groups, and then average again to the nearest 50 million oz. or 5%.

So, for 2006:
On the supply side, there is 900 million ounces:
About 650 million ounces of silver is mined each year, and growing slightly.
About 200 million ounces of silver is recycled each year.
About 50 million ounces of silver is sold by governments each year, and declining.

On the demand side, of the 900 million ounces:
About 45% is consumed in industry including mostly electronics, and growing slightly.
About 35% is consumed in jewelry and flatware.
About 15% is consumed in photography, and declining slightly.
About 5% is purchased by investors in the form of bars and coins, and growing slightly.

Investor buying is the hardest category to track, and is generally assumed as either "implied net investment or net divestment" to make the total numbers match on both the supply and demand side. The major change 2 years ago was a switch from "implied net divestment" to "implied net investment".

More silver than the "net" is traded between investors, during a year, perhaps another several hundred million ounces, it's hard to say. The investment numbers are simply "net" figures, that factor in that there must be more total investor buying or more total investor selling, and by how much.

The numbers are from surveys, and are rough estimates, and nobody fully agrees 100%, but the numbers from those top two surveys are very close, and I don't have enough knowledge or reason to dispute them. They make sense with what I know and see and hear in the real world, and they can explain a lot about the silver market, especially the great investment opportunity that exists.

In the entire history of the world, about 45 billion ounces of silver have been mined. Of that, nearly all of it, probably between 90-95% has been consumed, and ended up in landfills, as the silver has been changed into forms that are less economic to recover than new mining. So there might be about 5 billion ounces of silver remaining in the world that has been mined, and still exists, held by people in the form of bars & coins, jewelry & flatware, and scrap.

While known silver reserves in the ground are at about 14 years, more silver will be found and mined for the next 5000+ years or more, like always. (This proves that peak oil is bunk. All mines, like oilfields, are depleting assets, but the earth is a very big place.)

Very little silver is at the 4 NYMEX approved warehouses, only about 140 million oz.
Very little silver backs up the silver ETF, SLV, about 179 million oz.
Very little silver is purchased by investors each year, about 50 million oz.

The U.S. Mint makes about 10 million ounces of silver Eagles each year.

Silver Eagles thus represent about 1/100th of the annual silver market. The current Shortage of Silver Eagles is not technically a shortage of silver, you see. Ted Butler, who writes for Investment Rarities, suggests that their endorsement of Eagles has helped to cause a run on them, and I believe it.

I would personally estimate that about half of silver recycling, about 100 million ounces, moves through coin shops and has to be sold to larger dealers and refiners. More silver than that moves through U.S. coin shops back to the public, however, in addition to the "net" flows, but the "net" flows explain a lot.

1. It explains why most coin shops don't feel there is a shortage of silver, and don't feel the need to carry silver inventory.

2. It explains how and why coin shops can run out of silver so quickly.

3. It explains why coin shops cannot say when they will get more silver, since their source of silver is the public (they don't order much from refiners, they sell to refiners).

Let's assume that U.S. coin shops are 50% of the world market in silver. So, they buy about 50 million oz. of silver more than they can sell to the public. There are about 4000 coin shops tracked by http://coininfo.com/ which I advertise to help you find your local coin shop.

If we divide 50 million oz. of silver by the 4000 shops, that comes to 12,500 oz. per shop, on average that they have to buy, more than they can sell, in a year. Times $20/oz., that's $250,000 more silver per shop, per year, than they can sell to the public (usually, but not this week!).

Like any industry, there is a range that differs from the average, where some shops do a lot more business than others.

The market structure explains the relatively insane comments by coin shop owners that my readers tell me about, these conversations confuse my readers, and often sound like this:

Customer: I'd like to get a quote on silver.
Shop: If you are selling, the price is . . .
Customer: No, I'm buying, because there's a shortage.
Shop: There's a shortage of silver? But there's plenty of silver.
Customer: How many 100 oz. bars do you have?
Shop: We are sold out right now, but if you come back later, I'd be happy to sell you some silver.
Customer: Eagles?
Shop: Sold out.
Customer: Any silver at all?
Shop: Not right now, gotta go, phone is ringing. "Hello, are you selling silver? No?"

Coin shops would love for you to come back later, because they can sell silver to you at about 5% over the spot price, but refiners and other dealers will only give them about 1% under spot, at best.

Here's another estimated calculation to determine how much silver buying is needed to "clean out" the coin shops in a week: 50 million oz. of silver / 52 weeks x $20/oz.
= $19.2 million in a week.

This is what we saw these last few days. The public bought about $19 million more worth of silver than they usually buy, and cleaned out most coin shops around North America, and the world.

See how tiny the silver market is? That's why it's such a great investment. There's way too much paper money, and so little silver available!

At the same time, the rumors I've heard are that the large banks that are bankrupt and getting help from the Fed, were told to sell some of their gold and silver, because it makes little sense for them to be getting loans while carrying so much of those "useless barbaric relics" on the books.

But investment bank silver is not typically in the same form as silver demanded by the public, and it is not sold to coin shops, but at the NYMEX, or maybe sold to refineries and mints who might be taking delivery of contracts to make 100 oz. bars or 1 oz. coin blanks.

===================

It appears to me that Northwest Territorial Mint is bankrupt. Based on Ross Hansen's letter to me last week, a reader did some calculations based on the admissions in that letter. Ross sells 20,000 oz. of silver per day. And Ross has 300,000 oz. of silver "in the pipeline", and deliveries are about 60 days, at best. There are about 43 business days in 60 days. (5/7). 43 days worth of silver, for Ross, at 20,000 oz./day, should be about 860,000 ounces, creating a deficit of about 560,000 ounces of silver that they are short, and have taken orders for, and have not yet bought that silver in this rising market from $13 to $20/oz.

I received 20 more compaints about the Northwest Territorial Mint since Friday, some readers waited 5 months to get silver, others have orderd silver in November 2007, and have not received it yet.

On Friday, one man reported to me that he walked in to the Northwest Territorial Mint and tried to get 100 oz. bars, and could only get 6 bars.

Here's an interesting story about a mint that went bankrupt in 1980.

http://bulk.resource.org/courts.gov/c/F2/634/634.F2d.1285.79-1555.79-1554.79-1553.html

"the corporation was selling silver and other products which it did not have in its inventory and did not have sufficient cash to obtain. The period of delay in delivery increased as replacements were not full and complete in terms of maintaining an inventory which allowed prompt delivery after the sale. First there was a seven or eight week delay in delivery of orders to retail customers and a shortage of about 80,000 ounces of silver which became apparent in December 1973 and early January 1974.

===================

I've continued to get reports from my readers that coin shops are out of silver; 19 reports of shortages since last Friday, here's a few more specific ones, from people who really canvased the areas to discover shortages:

International: China, Dubai, Sydney, Vancouver,

Domestic: Houston, Chicago, Seattle, San Diego.

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I can confirm from my recent email exchanges with the Bank of China (BOC) that BOC has now ceased selling physical products of silver but undertakes to buy the same from her customers. No explanation was given.
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I just became aware of this silver bullion shortage through your site, and phoned up my regular silver bullion dealer in Dubai. I have bought from them many times in the past, and can ALWAYS buy as many 1Kg Emirates Gold "silver" bars as I like. So it has been heaven for me to have unlimited bars to buy...

However when I phoned just now, they DO NOT have any in stock, and they cannot say when they will!
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From a dealer in Sydney, "Yes, silver is pretty scarce here too. I went around to five dealers and I could only get one bar out of them. Gold, however, appears to be more available."
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I can confirm that several coin dealers in the Houston area are sold out. They said things like, "I'm flat sold out. I can't buy any from my suppliers. I won't be getting any in for a while."
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I called my brother who lives in the Chicago area to canvass his local coin dealers that he knows to see whats up with inventory of silver and he reports back they are all out of stock...
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Dealers hear in the Seattle,Wa area are out of silver, I did manage to get about 56 oz of silver from Northgate coins, but that was 3 days ago. Called around today and everyone is out. I called around in San Diego (where my father lives) and everyone is out there also.

===================

When you start reporting that businesses are out of silver, they tend to lose customers, and to prevent that, they say odd things. Here's one reader comment:

Perth Mint today and they said that the supply of silver was fine but the production was the problem and I had to wait 6 to 8 weeks for delivery! Source

HyperInflation is Making Gold Soar!

by Jason Hommel, April 5, 2008

Life is unfair. We are all being tested, all the time, on things that "are not on the curriculum" that nobody may have taught us. How unfair! Often we are tested on things that we have no way of knowing! Scary, but true. But the sooner we realize those facts of life, the better off we will be!

The results of the tests in life are not merely whether you get an A, B or C in school. In life, the tests will have far more significant consequences, and may determine if you become wealthy enough to effectively help others, or go bankrupt and have to start all over again, or worse.

Today, everyone in the world who has any money or wealth is being tested on their own knowledge of the nature and value of paper money, and on how much paper money there might be; and on the nature and value of silver and gold as money, and on how much silver and gold there might be.

We are being tested on things that nobody teaches, and on things that are, frankly, impossible to know, although estimates exist, and I do try to share some of the professionally compiled estimates on those subjects.

Here's a bit of the curriculum on money:

Archive: http://silverstockreport.com/ssrarchive.htm
The Money Chart: The Fundamentals of Gold & Silver Feb 25, 2006
Speech given at the Silver Summit September 26, 2006
Why Silver Will Soar May 23, 2007

Today, I'd like to talk a little bit about the facts of hyperinflation. Everyone will be tested on this in this market, so pay attention, because these facts are not widely taught. If you understand this, you can get a serious advantage over other people.

Back in 2003, I wrote:
Inflation & Deflation During Hyperinflation Nov 6, 2003
Back when I was selling individual essays, that was a best seller.

I identified a monumental sea change situation that changed in 2001. In 2001, an amazing thing happened. Hyperinflation started in the U.S., and has continued ever since, and gotten worse.

In 2001, the purchasing power of money in the banks (the gold value) peaked, and then started going down faster than the rate of increase of new dollars. Whereas before 2001, both the number and the value of dollars increased at the same time.

June 1998: M3 5,711 billion / gold price $296/oz. = 19.3 (billion oz. gold value)
June 1999: M3 6,221 billion / gold price $260/oz. = 23.9 (billion oz. gold value)
June 2000: M3 6,809 billion / gold price $288/oz. = 23.6 (billion oz. gold value)
June 2001: M3 7,628 billion / gold price $270/oz. = 28.2 (billion oz. gold value)
June 2002: M3 8,178 billion / gold price $318/oz. = 25.7 (billion oz. gold value)
June 2003: M3 8,761 billion / gold price $345/oz. = 25.4 (billion oz. gold value)
Sept 2003: M3 8,909 billion / gold price $390/oz. = 22.8 (billion oz. gold value)

Money value peaked in 2001, with M3 being worth 28.2 billion ounces of gold. That's a fact that "paper money value" peaked in terms of the amount of gold it could theoretically buy.

But hey, you know what? Experts claim there are only about 5 billion ounces of gold ever mined in the history of humanity! This shows that there are probably a few too many fraudulent dollars out there.

Today, the value of M3 is still bloated and terribly over valued, and M3 is still increasing in number, while shrinking in value.

Nowandfutures shows that M3 is $14 trillion. What a vast increase over $7.6 trillion in 2001! Nearly double in 7 years!

http://www.nowandfutures.com/key_stats.html

The gold price today is $912/oz.

So, for April, 2008: M3 14,000 billion / gold price $912/oz. = 15.3 (billion oz. gold value)!

That's 15.3 billion oz. of gold, in theory, that all U.S. money in the banks can buy.

U.S. dollars (Fed notes) are very over valued still, and going down in value, still!

And hyperinflation continues, as inflation of the money supply is now 19%!

INFLATION IS 19.5%! (Inflation of the money supply!)

What's inflation? The U.S. is diluting the value of the dollar by making too many.

It's like adding an extra can of water to the juice.

It's like adding a bunch of cold water to the hot bath.

It's like trying to make Jello with too much water.

The inflation rate is the amount of extra dollars that they are adding each year, that are destroying the value of the dollar.

But since 2001, the value of the dollar is being destroyed FASTER than the inflation rate--that's the hyperinflation that started in 2001.

You are being tested on your knowledge of that, right now.

To pass the test, you need to own physical silver or physical gold.

If you fail the test, you are happy to own paper money, paper bonds, or paper silver and gold certificates.

The Consumer Price Index, (CPI) inflation rate is said to be 4%.
http://www.bls.gov/cpi/

The CPI is under counting, as it uses hedonic adjustments, and excludes "unimportant" things like gold, silver, food, housing, and energy (what else is there?!), and the true inflation rate must be higher. Experts seem to suggest that the true consumer inflation rate is between 8-12%, but a housewife who pays attention to grocery prices might know more. This is another unknowable part we all get tested on.

Now, the difference between what bonds pay you (2-4%?), and what inflation takes from you (12-19-22%?), is the cost of owning bonds, and while I don't know exact numbers, as nobody can, what I do know, and I guarantee you, is that this is a negative number. What the number is, who knows. Let's say it's negative 15% or so. That's the price you pay, the money you lose each year, for owning bonds, now days, and this has been the penalty since about 2001.

Don't pay attention to people who claim there is deflation, or worry about deflation. There is inflation, a lot of inflation, so much inflation that we have hyperinflation. The thing that is deflating is the value of money, because there is hyperinflation.

Why is there hyperinflation? Because there is "never enough money" to avoid bankruptcy of the major institutions, because they are printing money for the war in Iraq, and for too much government. The money printers are fearing deflation because other people might be taking money out of the banks (which is said to be deflationary) to hold it in the mattress, spend it overseas, or use it to buy silver and gold. But that's not deflation, it's the result of hyperinflation.

Hyperinflation makes people take their money out of the banks, and spend it as fast as possible.

The point is that there is no monetary incentive for people to hold cash or bonds right now; as they are losing money because of the high money creation rate, and the gold rate increases.

Another main point that follows is that gold will continue to go up as long as current conditions exist, as they have, since 2001. Since 2001, gold has been going up by about 22% per year. That's from $250 to a high of $1000, over 7 years.

Now then. Where are the economic incentives today when owning gold pays 22% per year, and owning bonds costs 15% per year?

The incentive is to sell bonds and buy gold. The world economic conditions are paying people to move into gold.

There is no reason to think that anything will change, until it does.

The required change is for bonds to pay more than the annual gold value increases.

Until bonds pay more than owning gold, then gold will continue to rise.

How far will this process be likely to go? How long? Until when?

Until bonds pay more than owning gold, then gold will continue to rise.

That's not a misprint; it's a repeat of the main point.

Here's another clue:

The size of the U.S. Bond market might be about $25 trillion, and the world bond market might be $50 trillion.
The size of the world gold market might be about $5 trillion.

Right now, an extremely tiny portion of the $50 trillion market is trying to buy into the $5 trillion market.

I think about $0.115 trillion is going into gold annually right about now. (4000 tonnes x $900/oz.)

That's about 1/5th of 1% of the money is going into gold. And yet 91% of the people are now concerned about inflation. Selling gold to people should be the easiest job in the world right now, the easiest pitch ever. Everyone should want it, yet virtually nobody is buying it, the demand has barely started, and the demand for silver is like 100 times less.

This might be another clue as to how long the gold market will go, but is no guarantee:

Jan. 1980: M3 1,822 billion / gold price $850/oz. = 2.1 (billion oz. gold value)

Gold will go up at least until the gold value of paper money is 2 billion gold ounces, or significantly less, as that was the condition in 1980, and it should probably continue further than that. After all, the U.S. government does not have 2 billion ounces of gold; it only has 0.261 billion ounces of gold.

Be prepared for gold prices to continue to rise about 22% per year or more, at least until bond interest payments rise to over 22% per year, or whatever the gold price increases might be at the time.

Now, I want to address people who will inevitably ask me, "What will happen if there is deflation". I will respond, "There isn't any deflation". They will respond, "But so-and-so thinks there is deflation." I will respond, "Well, so-and-so is wrong." They will respond, "But what if things change, and we actually have deflation?" OK, there's a real question. I will respond, first of all, there is no deflation, the money supply is soaring. Before the money supply can actually shrink, it has to slow down growing, and we'd see that first. Then, the money supply would have to be stable. Then, the money supply would have to actually stop. Bankruptcies would vastly increase. Bankruptices are one of the only things that can actually cause deflation, as that destroys credit and money in the banks when banks go belly up. When banks start going bankrupt, how confident will people be to let their money sit in bonds in the banks? Not very. They will start to buy gold even faster than they do today, since gold is not anyone's liability. If that happens, gold will go up until bonds start paying more than gold is going up each year, AND until banks stop going bankrupt. So, if there is deflation, gold will go up more, and for longer, until people trust banks again, which could be a very long time.

This is why the Fed is doomed. Printing more will not work. Printing less will not work. Printing nothing will not work. All the inflation of all the years from 1913 until now is beginning to crash down on our heads, and it will keep crashing until it stops. And when will that be? Until bonds start paying more each year than gold is going up each year.

As always, silver trumps gold, in my opinion, since so much silver has been consumed in jewelry and flatware and industry. If the silver to gold ratio returns to the historic 15:1, we will make 3 times as much money in silver, than in gold. But due to the rarity of silver, because it has been used up, because it is hard to find, and because only about 8 times as much silver is mined than gold each year, silver will probably exceed the value of the historic 15:1.

To get an A+ on one of the tests of life today is real simple. You don't need to know any of what I just said, but it might help. All you need to do is buy silver.

Monex is the low-cost gold and Silver retailer. Paul Bea @ monex 800-949-4653 x2172
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