In Jim Cook's Archive


How many people truly believe they can get rich owning silver? Not very many. In fact, the public is buying very little silver these days. At a time when silver analyst Theodore Butler claims that silver is radically undervalued and on the threshold of a price revolution, the buying interest in this miraculous metal has petered out. Of course, if it was being purchased hand over fist, the price would be higher and the opportunity would not be there. Both the low price and the lack of interest are necessary ingredients to what Mr. Butler calls an opportunity to make money like nothing you will ever see again.

Theodore Butler is a paid consultant to my company. Over the years, he has pioneered breakthrough analysis of silver. Few followers of silver would dispute that he is the preeminent thinker on the subject. After a relationship that has lasted 15 years, I’m convinced Mr. Butler is the world’s foremost silver expert and a towering genius on the subject. He dispenses his wisdom through an expensive weekly newsletter. However, readers of our newsletter get a condensed version of his most important work.
When Mr. Butler tells you there is a fortune to be made in silver, you should listen. He has the credentials to give this advice. He’s gone so far as to suggest that silver will rise to $100 to $200 an ounce and perhaps more. He has enumerated powerful reasons for the price of silver to soar. He has claimed that the coming explosion in silver will be like an atom bomb, on a hydrogen bomb, on a neutron bomb.

Today he points out that the amount of industry-standard silver in the world is slightly over a billion ounces. Add in jewelry and coins and you get somewhere around 2 ½ billion ounces of silver in the world. The total of gold is over 5 billion ounces. There is twice as much gold as silver, yet gold sells for 83 times the price of silver. Silver has enormous industrial demand while gold has very little industrial use. Newly mined gold goes into a vault while silver gets used up by industry. Silver is scarcer than gold with only $35 billion of silver above ground and $7 trillion of gold. A case can be made that silver should be worth more than gold. In ancient Egypt silver was more valuable than gold. Perhaps it will be again.

The reason for silver’s scarcity is that such a low price encourages greater industrial use and also discourages mining production. Mr. Butler suggests this is leading to a shortage. He sees signs of tightness in the unprecedented turnover of silver bullion in the COMEX warehouses and in delivery delays into the silver ETFs. Meanwhile, he insists that JPMorgan has acquired between 400 and 500 million ounces of physical silver on which they intend to make an enormous profit. All this sets the stage for a price explosion of inordinate ferocity. Mr. Butler points out that, in terms of bullish factors, silver has never looked better.

He will tell you that a fortune awaits those who own silver. We would only add that if the mad scramble he predicts for silver does ensue then you better have the silver in your physical possession or stored in your name at Brink’s where you get the serial numbers of your bars. Many people will be short silver and various storage programs will have nothing stored. The coming silver blowup that Mr. Butler envisions will be one for the record books. The smart and prudent people will score big, but those who believe in fairy tales will suffer. Follow our advice whatever you do. If Mr. Butler is right, and we believe he is, this is truly a chance for the score of a lifetime.

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