In Jim Cook's Archive


Two powerful reasons exist to own silver.  Silver analyst Theodore Butler articulates the first argument.  He doesn’t pay attention to the economic reasons such as inflation or debt.  He makes his case for silver based on fundamentals and market analysis.  He deals solely in facts and rarely if ever, in suppositions.  He’s the ultimate thinker in silver which he has analyzed closely for 25 years.  During that period he has originated every issue that occupies the silver pundits of today.  His forecasts and predictions have been breathtakingly accurate.

He uses the data put out by government regulators of the silver market to make his case.  For many years one large Wall Street bank has held an extraordinarily large short position in silver.  This short position dwarfs anything seen in other commodities.  Because it has acted to suppress the price of silver it has thrown supply and demand off their normal course.  A low price for silver has increased demand by industry and at the same time diminished the new supply from mining.  Consequently all of the silver ever mined for thousands of years has been used up and is gone.  Today the above ground supply of silver is in short supply.  Mr. Butler claims that the outcome of artificially low prices must inevitably be a severe shortage.

He points out that the industrial usage of silver for thousands of electrical and electronic applications makes it more desirable than gold.  Silver is used in cell phones, computers, TV’s, batteries, solar power, medical treatments, ad infinitum.  More recently investors have begun to pile into silver adding dramatically to demand for coins and bars.  Mr. Butler predicts that this strong demand will overwhelm the supply aggravating a shortage that he sees unfolding now.  He claims this is bullish beyond belief.

He predicts that industrial users will begin to panic as delays in delivery reveal a shortage of silver that they must have or go out of business.  The panic buying that ensues will send the price of silver to unheard of levels.  Meanwhile, the big bank with the outrageously large short position will be faced with monumental losses if it does not buy back futures contracts to cover its short position.  This buying will be like pouring gasoline on a forest fire.

This is a well informed and articulate argument from the world foremost silver analyst (also the most plagiarized).  However, it leaves out what I consider to be most the important reason for owning silver.  We are entering a new era of money and debt creation that dwarfs anything in history.  Already people are buying silver primarily because it is a store of value.  The dollar no longer stores value effectively.  It’s losing value and the odds favor it losing substantially more value in the future.  If present trends continue it could lose all its value.  One of the greatest free market economists who ever lived, Ludwig von Mises forcefully pointed out that inflation is a policy that cannot last.  It must destroy the purchasing media of the country that employs it.  The dollar is in big trouble and forces beyond our government’s control (foreign bond holders, currency traders) can devastate the dollar.

If that happens, you need to have silver as an alternative purchasing media.  Silver can offset the loss of paper values and act as money in a crisis.  It may seem farfetched to you that our dollar could die but if you examine the history of paper money you’ll see that thousands of currencies have become worthless.  Paper money never survives and throughout history those who relied on it have suffered.

Silver offers profit, protection and peace of mind.  With our national finances in a state of permanent crisis you are well advised to consider putting at least 10% of your net worth into silver.  Those who have followed Mr. Butler’s advice and our recommendations over the past fifteen years are literally up billions.  Our consistent objective has been to add to our clients’ financial well being and prosperity.  We aim to continue this trend.

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