Silver. The price was held by closing of the American market at precisely $22.62 for four hours, dropping a few cents before closing time. When New York closes for the long weekend, prices stabilize. This tips us off the manipulation probably originates here. Here’s an interesting video about gold pricing in relation to silver. The appropriately named trillion-dollar time bomb. It’s worth watching.
The significance of the silver manipulation is how the huge piles of dollars being printed and dumped on the American market have not yet had much effect at street level. Why has not inflation soared? Possibly because the money is not going to consumers, but to lenders and manufacturers. My favorite theory is that the US now forces the world to act in coordination. In the Great Depressions, every country independently devalued its currency. Today, the global interdependence of money means all major nations are devaluing at roughly the same rate. Instead of stampeding through like the 30s, the governments have agreed to spread the misery around. (They call it currency harmonization.) But plans on such a scale rarely work. There is always a Greece or Cyprus, or Spain to muck things up royally.
What will silver do? I don’t know. That’s why they call what I do “speculation”. What is certain is that all the historical balances are off kilter. But you cannot go wrong having some kind of hoard. If prices fall, buy more. I don’t have that much tied up, but if my dollars were soldiers they’d be battle-tested veterans. They can handle the ride. I don’t much care about public demand for precious metals. I’m waiting for some government to get into the game. They say whichever country goes back on the gold standard now will own the world in forty years.
Another thing to watch is the government raiding civil servant pension funds to meet its payments. Ruthless as it sounds, I would love to see a default on those bloated cash cows. There’s something I plain don’t like about DMV employees getting a better retirement than those who worked hard to produce valuable things. Rumor is the feds are also dipping into the once-sacred postal employee account.
Cancel my plans to hit Miami today for tea with my lady friend and a visit with JZ. Maybe go on a skrunt hunt. I am so tuckered from this new band I slept past dawn until 12:30 PM. But that is how important this band is. And I’m still exhausted, so no Moose Karaoke tonight either. Instead, I caught up on current events, which I hesitate to classify as news.
What’s this Barbara Eden reappeared wearing her “I Dream Of Genie” costume at a benefit in Vienna? It was hard to tell which of the two was more wrinkled. And I do wish Aniston would get out of the way and make room for a younger, more talented lass. She’s always been too one-dimensional for me. Let me cook up some more controversy as my ratings have been sliding from lack of travel due to the new band. Naw, I can’t invent anything at the last moment, but I do think two-thirds of that Cannes film festival should be abandoned on an ice floe. Get some fresh talent in there, for crying out loud.
Or how about that Ukrainian band “Make Me Famous”? I had to do a double take when I read their member section. Vocals, per Wiki, are now divided into clean, growled, or screamed. As near as I can say, these categories exist for the listener who cannot figure out the difference for himself. The scream is Shaforostov. The growl is Kravchenko. The clean is pretty much missing entirely. But it can be briefly heard in their hit, “Once You Killed A Cow”, which I initially mistook for Tammy Wynette on uppers.
ADDENDUM
Who recalls the silver rush of 1983? The rumor was spread that the Hunt Brothers tried to “corner the silver market”. I say rumor, because even though I am no expert, I know that two billionaires who ran oil companies for fun and profit were just not that dumb. But I can tell you what is more likely to have happened. In many states, including Texas there is widespread dislike and distrust of DC and the “Rockefellers”.
During the wild double-digit inflation of the 70s, the Hunts had bought silver as a hedge and had doubled their money. They had good reason to own a lot of silver and for wanting the price to go up. What is known for sure is that at that time they purchased silver, silver futures, and part of a silver mine. They did nothing illegal.
However, they had few friends in DC. I had just started my first real job back then and had looked at silver for the same reasons. If you find something in limited supply and unlimited demand, and if you buy enough of it, the price is certain to shoot up. The Hunts took to flying around the world and promoting silver sales. Why not? Then I remember a law being passed at that time that individuals could not own more than 10,000,000 ounces. Back then, this represented only $20,000,000. As far as I know, this law still exists.
[Author’s note: For economics students confused about the difference between elastic and inelastic demand, think of silver and make your life easier. Normally as the price of something rises, you’d expect people to buy less of it. Not silver. As the price [of silver] rises, people will buy more and more and more of it. Therefore, the demand for silver is “inelastic”. You’re welcome.]
To me, the Hunts’ biggest error was not keeping their dealings private. Who remembers when they hired the Texas Rangers to ride shotgun on a fleet of armored cars to move their silver? And the Hunts were pals with the Arabs, where many of their oil wells operated. The fat one, Bunker Hunt, was also an outspoken advocate of abolishing the Fed mints with their money-printing machines. Private silver ownership represents competition to the federal money supply and the Big Banks don’t like that. Hence, you never hear of large silver purchases any more. People keep it a secret.
[Author’s note: I looked it up to refresh my memory, and it was not the Texas Rangers, but a private gun club. Sorry about that. But still—highly organized criminal gangs exist mostly in the movies. The Hunts were not worried about gangs, they were worried about government confiscation. What? Same as gangs? Don’t say that, you’ll get in trouble.]
Again, I don’t know the gory details, but this law was used to bring down the Hunts and charge them with a crime. Post Facto law. If you wonder why westerners don't like easterners, that's a clue. It was obvious then and crystal clear now that the Hunts had been shafted by Wall Street. Alas, outside of Texas, oil billionaires don’t command enough respect to become the underdogs. To this day, most people believe the big lie.
How did the law work, the law that snagged the Bunkers? Easy, the Bunkers had bought on margin. When the time limit is up, you have to pay the money. Their enemies suspended silver trading until the Bunkers ran out of money to meet their margin calls. Lesson Number One: If you don’t hold it, you don’t own it. Lesson Number Two: silver is a game for small players in vast numbers.
What about gold? There are even more rules concerning gold. There’s a wise saying, “Buying gold is easy. It’s when you go to sell it that you find out how stupid you are.”
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