Eric Sprott today said that silver will be remonetized and return to a role as a currency. http://silverdoctors.blogspot.com/2012/02/eric-sprott-silver...
How do you guys see this playing out if Obama is re-elected vs. if we get Paul elected? Obviously Paul will do what he can to re-institute gold and silver as official currency, but will the market do it for us anyways even if Obummer or Romney is elected?
No.
not enough there - even if price rises. Gold is already monetized and will take on greater significance, and the market will in fact do it for us.
I don't see your logic behind saying that silver cannot be money because there is not enough out there. The US Mint, Canadian Mint, etc already sell about equal dollar amounts of both silver and gold showing that individuals demand both metals as a inflation/economic collapse hedge. Interest in Sprott's physical etf and regular etf's show similiar figures. And there is obviously more ounces of silver being sold to the public than gold. So with an adjustment in the price of silver upwards I don't see how it wouldn't be considered money. Add to the fact that once gold becomes even more expensive individuals will naturally begin buying more silver as they are priced out of the 1 ounce, half ounce, quarter gold ounce market. If the average Joe only has $300 bucks from his last few paychecks to put into PM's I'm pretty sure he will buy a few silver eagles rather than saving up for months hoping that the system doesn't unravel while he waits to buy a gold eagle.
I suppose if your sole factor is whether sovereigns will settle in silver as well as gold, I guess your correct for now, but in my view that can easily change as PM's take a greater role in international exchange. I am interested in your viewpoint though, I clicked on your link and it took me to a blog homepage and I'm too lazy to search around on a blog for what your talking about :P
but essentially, there is not enough silver to soak up the need for capital savings - it just is not there. Gold can be purchased in grams, and any small denomination, and is the best way to protect savings, so it won't matter Joe can still buy it. There will still be fiat currency. Silver will be more expensive, but won't be used as savings nearly as much as gold is/will be because gold serves the function perfectly and is not destroyed in industrial processes like silver is.
But your making the argument in relation to today's price, if the price of gold and silver go up dramatically then there is enough to absorb savings. I don't see how your argument differs from fiat backers say that gold cannot be used as money because there is not enough out there. It all depends on the price of of gold/silver. Silver could be purchased in increments too if the price goes up, only reason it is not now is its only $30 bucks an ounce - a price even a homeless person can afford. If silver headed up to $500 an ounce I bet some private mints would be making half or quarter ounce coins since there would likely be a demand for them.
And to the second part of my point, you can see that individuals are already buying equal/greater dollar amounts of silver over gold in terms of eagles/maples, so obviously >people< deem silver to be as good as gold.
In terms of industrial uses, I agree with you. However, I think people choose a monetary system based on history, and historically speaking gold and silver have both been consistently used. I rather think the (expanding) industrial uses of silver is more of a cherry on the top. If new technologies suddenly used gold for industrial purposes would it be thrown away as a valuable means of exchange? I doubt it, but I guess the market will ultimately decide.
The Big Dogs will continue a system of fiat money for the foreseeable future, because it is by far the easiest thing for them to do. It doesn't even need to be physically printed anymore. It is simply conjured up out of electrons. Neat trick.
I guess my return question is: so what? Let them do it--you most certainly cannot do anything about it. Gold and Silver will simply continue to be a store of value. Why is that not enough of a reason to convert one's paper savings to physical PMs? You could also convert them to Picassos, or apartments on Central Park, or any of dozens of things that hold their value, too. Personally, I like the nice shiny coins that are so very liquid, and besides, I can't afford a place in the Dakota.
...silver will do well also, but gold I believe even better - read the entire article on the front page
With production and supply contracting and industrial use expanding, how would it be possible to circulate silver as a countrywide (worldwide) currency. It just does not seem feasible.
It would seem to me that the scarcity of this metal over time would dictate it be treated more like gold.
Many bright people believe that AG could be (one of) the first metal(s) to dissapear
A store of wealth would seem to be a more logical conclusion. What am I missing?
Not sure if I've posed the question clearly, but I'm interested in the thoughts of others.
I dont understand the argument that silver cant be used as money because there isnt enough. During WW2 almost every country in the world had silver currency .
And gold/silver coins were not pure bullion, they were mixed with other metals.
I believe they will never be used as a currency again as long as Global bankers and the Fed have any say in it.
Back then silver was used as money and there was no electronics industry. Since then that silver has been consumed, leaving too small a supply. Look at some of this article - like stock and flow: http://fofoa.blogspot.com/2011/05/costatas-silver-open-forum.html
Plus, paper money won't be going away. However, dollar dominance will, leaving the need for a new reference point - gold.
No different than the CNBC pumpers and the anti-PM Cartel banksters themselves, except this guy is running the pro-PM Cartel.
just me or did the article linked above amount to nothing? Only difference is fundamentals are on the side of Sprott's pumping. Pumping things with deteriorating fundamentals.... financial stocks, anti-PM's when the world central banks are flooding the world with money, etc is not only quite different but dishonest.
The Big Dogs will continue a system of fiat money for the foreseeable future, because it is by far the easiest thing for them to do. It doesn't even need to be physically printed anymore. It is simply conjured up out of electrons. Neat trick.
I guess my return question is: so what? Let them do it--you most certainly cannot do anything about it. Gold and Silver will simply continue to be a store of value. Why is that not enough of a reason to convert one's paper savings to physical PMs? You could also convert them to Picassos, or apartments on Central Park, or any of dozens of things that hold their value, too. Personally, I like the nice shiny coins that are so very liquid, and besides, I can't afford a place in the Dakota.
Ahh, Rico you said it just perfect. convert your SAVINGS into anything that stores value or makes you money, land to rent to farmers, houses to rent to people or pay off a house. Get out of debt and have multiple streams of money coming in.
Great post.
I really thought Rothbard's "What has government done to our money?" explained the differences between what we have now and traditional banking systems pretty well. At any rate a gold or silver backed currency would probably be a lot similar for most people to what we have now. Most deposits stored in bank vaults with mostly electronic transfers taking place. There's no reason they couldn't simply use grams instead of troy ounces for a single unit, or any other concievable measurement for the weight of the specie backing the issued note.
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