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Jim Cook



Every once in a while I switch the TV channel from Fox to CNBC to see what the liberals are saying.  After listening awhile I get a deep sense of hopelessness and foreboding for our country.  The most important thing for the left is giving money to people.  They are happy to see the growth of food stamps, disability payments, housing subsidies, free healthcare and all the other welfare benefits.  They utterly fail to see the damage it is doing to the recipients.  Whole cities that once flourished have deteriorated into rotting eyesores populated with shambling hulks of chemically dependent drones.  These people are no longer employable.  They have become incompetent and helpless and the liberals can’t see that it’s their doing.

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The Best of Jim Cook Archive

Best of Jim Cook
December 6, 2005
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Despite warnings from Ted Butler, people still continue to purchase silver in unallocated or pool accounts. According to Ted, any time your purchase is combined with others, most of the silver is not there.

People buy this silver because it’s cheaper. No wonder. Let’s say my company sold you silver in a pooled account where you don’t get specific serial numbers. We could buy futures contracts to hedge the silver we sold you, and use your money for our purposes. We wouldn’t make much money hedging perfectly, so there would be an inducement to speculate. That’s usually what happens. Twenty-five years ago, Bullion Reserve, a California company, guessed wrongly in the futures market and sixty-million dollars in silver was found to be missing. The company president took his own life.

According to Ted Butler, any company operating in this fashion should be avoided. Even if you buy a storage program that gives you the serial number, you have risks. Usually that’s because there’s no financial disclosure. You don’t know the financial status of the company. You don’t know if they’re speculating. In some cases, you don’t even get a storage agreement directly between you and the company doing the actual storage. They’re only a middleman with no financial statement available.

In the past, when silver prices were fluctuating dramatically, and public interest in silver was high, major failures occurred. Invariably, these companies were speculating in silver futures. If you think some companies are too big or too smart to fail, remember Handy and Harmon, who shut their doors when their hedges backfired. Make no mistake about it, if the silver market explodes, or if trading gets hectic, you run the risk of becoming an unsecured creditor to a bankrupt company, instead of enjoying the immense profits that higher prices would bring. A few months ago no one thought it was possible for Refco to disintegrate, but they did.

Our storage program offers every safeguard. You store with one of the world’s largest banking groups. You can see their financials. The silver is in your name with specific serial numbers. If you choose a pool account over this arrangement, in the face of Ted Butler’s strongest possible warning against it, you need to reconsider.