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The latest silver news

I have been in “teaching mode” today (with contractors doing work on our house) and also have a physical therapy appointment this afternoon, so I won’t have time to do a regular weblog today.

Recall from last week that I wrote that the spot price of silver closed above $50/oz and that this was a major long-term sign of the fall of Babylon. Specifically, it is not that the price of silver (and gold, too) is going higher; it is that the value of the dollar is dropping. In other words, it takes more fiat money to buy silver and gold—and everything else as well.

Most people refer to this as “inflation.” Prices inflate as the dollar value deflates. $50 silver threatens to collapse the US dollar. The big banks, in collusion with the government, has manipulated the price of silver to keep its price low so that the dollar looks better. But recently, they have lost control of the situation, sending the dollar to new lows, relative to gold and silver.

The US dollar is still strong in comparison to other fiat currencies, but this is only because all the fiat currencies are falling at the same time (at different rates). Gold in particular is the constant. Fiat currencies fluctuate, going down in value over time.

Last Friday, the price of silver closed above $50 for the first time. Right now, six days later, it is holding above $54/oz. Gold is now above $4,300/oz., another all-time high.

https://www.apmex.com/silver-price

Many countries are running out of silver as people flock to the dealers to convert their paper into something tangible. Premiums have risen far above the spot price, because dealers are reluctant to trade their silver for pieces of paper that are going down in value. Fiat currencies depend fully on faith and confidence, backed by nothing but government promises, and as more and more people cease to have faith and confidence in the currencies, they often convert their bank accounts into silver or gold to preserve buying power. That is what is happening now.

Economists recognize that if this situation continues, it will threaten the entire financial system worldwide. Banks will begin to file for bankruptcy, and governments will seek more power and control over everyone’s ability to buy or sell anything. Trump has already declared silver to be a strategic metal, which prepares the way for the government to limit silver purchases and perhaps to force people to sell their silver (bullion) to the government at whatever price the government claims is its value.

However, it is doubtful that the government will be allowed to force anyone to sell their silver coins such as 1 oz. silver eagles or pre-1965 dimes, quarters, half-dollars and old silver dollars. These constitute constitutional money, and the government cannot (lawfully) take anyone’s money. Of course, the government is not known for its respect for the constitution. We used to be a nation of laws, but in the past few years we have become a “rules-based society.” Few people know the difference between a law and a rule.

Money and currency are not the same thing. Money is defined constitutionally in terms of silver or gold. Currency is the promise to exchange it for actually money (silver or gold). Therefore, currency depends on faith and confidence in the government’s willingness to make the exchange. That faith has been eroding for many decades but is now being destroyed at a much faster rate.