The phone rings, and it is an old customer who lives a few miles from me. Peter asks if he can bother me for a few minutes. “Certainly! Come on by.” Peter comes by, doesn’t want to buy anything, but pulls out a folded advertisement which tells the reader that he can get silver bars for only $69. A very special deal.
“I sort of knew it was a bad deal, but I just wanted to get your opinion.” That wasn’t a difficult opinion to give, and midst smiles, I informed him that since silver is about $16 an ounce, we have silver bars and coins for as low as 28 cents over spot, or a bit more for Silver Eagles. At any rate, Peter and I had a nice long conversation about his farm, etc. Nice guy! I figured that solved that.
Then, in the Wall Street Journal, of all places, on page B-9 of last Monday’s issue, I beheld a full page ad for, “New State Silver 100’s.” Below are listed the first two letters of each ‘zip’ code for the states, and if your zip code starts with any of these, (Gee Dad, really?), and you are among the first 17,544 callers from one of these states, you can get one of these for $57, and others will pay $200. Shame on you Journal!
I decided to look up “Federated Mint” on the internet. They registered their trade name on September 4, 2015, and they are in Hinkley Ohio. New company formed to sell these frauds? Then I went to another place on the same Google page, and there was a story in “Mother Jones,” with the bold headline of, “We should stop helping the silver scammers.” A couple of quotes from the story: “The current fixing for an ounce of silver is $16, and if you pay $1160 for $160 worth of silver, they’ll throw in shipping gratis. What a deal. But really: Are we all so desperate for advertising dollars that we have to sell space to folks like this?” The ‘nocturnal airline companies,’ (fly by night) continue to proliferate I suspect, but an ad for them in the Wall Street Journal? I’m forwarding this column to the Journal editor.
The current ratio between silver and gold today, is 80 to 1, and yesterday it was much higher. Historically, the ratio has been 16 to 1. In other words, today, gold is 80 times the price of silver, and of course it takes 80 times as much space to store and ship. This can mean a couple of things, based on the historic ratio, and that ratio goes back a thousand years. Either gold is too high, or silver is too low, since it should be a 16th the price of gold, not an 80th. I say silver is ridiculously cheap, but I am not of the opinion that $200 silver is in the works as the fraud TV ads spout. If silver went to $200, and the ratio stayed at 80 to 1, gold would be $16,000 an ounce. How can anyone know what will happen ten minutes from now? When the Dow went down like a wooden roller coaster, did anyone know ten minutes before? No. All I know is that gold and silver have been actual money for thousands of years in all civilizations, and today are convertible into any currency in the world. They will therefore buy anything in the world.
After WW I, the German Reichsmark had gone from a US quarter to requiring a wheelbarrow full to buy a loaf of bread. My Dad bought a new Plymouth for $650 in 1940, and my 76 year old truck sold for $400 in 1941. A silver dime in 1941 was worth a dime, and with that dime you could ride a trolley (I hope you remember them!), or get two 12 ounce Pepsi Colas. Here we go again with memories. but I will never forget the jingle. “Pepsi Cola hits the spot. Twelve full ounces, that’s a lot. Twice as much for a nickel too. Pepsi Cola is the drink for you.” Sorry! I’ll be 84 Saturday. The point is simply that since politicians cannot stop spending money they don’t have, it has to be printed to pay the bills, and that is called ‘inflation,’ meaning that all prices will go up for things which have actual value, such as Plymouths, Pepsi Cola, and silver dimes, which as I write this, are worth $1.23.
Silver is a wonderful way to store your wealth. You don’t need a crypto coin backed by nothing, but a silver or gold coin, which is in no way backed by any government, because they are valuable in themselves. They’re made of silver and gold! What better backing can there be? A fellow in Silverton, Colorado yesterday checked Google for “gold and silver stores in Montrose Colorado,” and he came up with me. He called and we went through a long conversation about every possible way to prove reliability and honesty. “Do you have a store?” “Have you been in business a long time?” “Do you have a Better Business Bureau rating?” He had been defrauded in Phoenix AZ, by someone. He wanted to meet me and decide if I was trustworthy or not. He came over, and we got along just fine.
I am officially retired, don’t sit at my desk every day, and rarely do a trade, but this guy needed a couple hundred ounces of silver and I did it. Some people are honestly suspicious about gold and silver dealers, but will buy Bitcoin from shady dealers on the internet. You figure it out. We have been in business since November of 1977, and that’s a long time! We’ve never done any advertising. Word of mouth by honest people is enough. – Don Stott – 1-888-786-8822