Strathclair Ventures (fka svl.t)

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Another good article on silver.
Coffee, Tea or Silver?
by Charleston Voice
With the price of silver (POS) poised to punch through its multi-year suppression price of somewhere around $5.50 an ounce, it should be giving some old timers a pause for reflection on ages past.

If you've been around long enough many of you can readily recall when silver heirlooms, sterling flatware, silver coins and dollars were lugged in to local coin shops by the bucket load for melting and turn-in for US dollar banknotes. I can't remember precisely when the great meltdown began, what the POS was, but it was frantic and stressful to be on the buying end as I was, being a "vest pocket" coin dealer at the time. I think the big rush lasted about 5-6 weeks, say as the POS crossed over $35, peaked at $50, and worked its way back down. Over this parabola, people dumped. The year was 1980.

Remember at the time it was speculated that silver coins would begin circulating again? You'd be able to get a gallon of gas for a silver dime, its time proven real price? Well, we never got to that point obviously, although a couple of gas stations in my community did make such offers; probably more of a marketing ploy than a substantive business decision.

Uncirculated silver quarters dated 1964 have now become eagerly sought after by coin collectors and investors; the reason being that during the great meltdown, 1964 coins were the most plentiful and were the first surrendered to the melting pot. I mean, really, those '64 Kennedy halves and Washington quarters were everywhere - a big nuisance, dump 'em!

Anyway, that brief inflationary burst and the rise of precious metals gives me pause to wonder what will happen this time?

Back then in 1980, Americans at least had a greater understanding of what constituted sound money, not many of course; but far more people understood what was happening than I feel will grasp a similar situation today. The US Treasury still had some silver, and if you believe Treasury accounting, they had some gold, too. Not so today. It would have been a wonderful opportunity for the US Government to re-introduce precious metals as a circulating medium, and return the country to a sound and honest economic footing. But, the pull of spending and printing money in unlimited amounts was just too great for our unprincipled congressmen. A little better than today, but still looking after their own political self-interests before that of their constituents.

Here's the picture. What we're really finding annoying today is that some supposed gold and silver "experts" are bandying about the postulate that somehow Greenspan is going to return gold to our monetary system. Give me a break! I'm not even going to dignify that theory with a rebuttal.

But, what I will do is ask you how a Wal-Mart or a McDonald's would conduct their business if silver coins, what may remain in personal hoards, began to circulate again? Would they begin posting their daily (hourly?) silver exchange rates on their marquees, or drive-thru menu boards? Watching cash register checkout clerks trying to handle a transaction with real money would be an amusing sight to behold! Watching a numb-numb clerk making change would be an even greater laughing matter. Would they offer you a Wal-Mart Script in exchange for your silver coin as you came in their store? Where would they deposit their end-of-day silver receipts? Would they have to accept one of the gold or silver backed e-monies now available? There's little likelihood that Wal-Mart or any other US jobs exporting company could do it either. They'd certainly have to be pressured competitively to change their ways, and train their people. And the way that might happen is for local American businesses to gain back some of their lost business by being able to accommodate their customers' desire for a dual money system. You begin now to see the dangers of reduced competition with the rise of slavemasters such as Wal-Mart who have crushed all competitors. Wal-Mart's business plans call for expansion into every area of consumer concern, from automobiles, to gas stations to Small-Marts, a chain of smaller convenience stores to pick up any crumbs missed by their mega stores.

In the months to come, we're going to hear again from some quarters that silver may be used in transactions again. One thing is for sure though, if entrepreneurial America is to regain a consumer competitiveness, the shrewd American small businessman will begin now to offer his customers a choice - silver or paper.

And, for right now, Wal-Mart can't handle that!


- - Charleston Voice