A Blast From The Past

[webmaster]

Subject:A Blast From The Past
By: Theodore Butler & James R. Cook

Overview: There will continue to be dramatic gains in solar power, electric vehicles and electrical transmission. The future will require significant quantities of silver. This will exert a powerful stimulus on silver prices. You should buy silver for its many electrical applications, not the least is the "charge" it can give to your financial well-being.

Link: http://news.silverseek.com/TedButler/1240328208.php

[Ardent Listener]

Good article. I like to be reminded of silver's industrial value or applications once in a while. IMO, silver as an industrial metal has been under discussed on this site recently. If or when we are able to get though this economic mess without reverting back to the stone age then silver like other industrial metals should continue to be a strong solid long term investment.

[LoboNoches]

Originally Posted by Ardent Listener

Good article. I like to be reminded of silver's industrial value or applications once in a while. IMO, silver as an industrial metal has been under discussed on this site recently. If or when we are able to get though this economic mess without reverting back to the stone age then silver like other industrial metals should continue to be a strong solid long term investment.

That being said is it safe to assume that given the rise of clean energy and such that rhodium could play a huge role as an industrial metal given its unique atomic structure combined with silver in fuel cells and cold fusion applications?

[Mike Phillips]

Don't forget that silver is not only the best conductor. It is also a great radiation shield. So it is the precurser for almost all superconducting wires used in transmission and motors. Superconductivity as used in electrical storage and transmission will be the next electricity breakthrough.

There just is not enough silver for all this stuff. Never mind investment demand. Never mind all the ridiculous naked short positions by all and sundry. Shorts are going to get their clocks cleaned. But that is nothing new. The CDO market already did that to the banks. No, this is REAL. Silver is the new metal. And it is going to a "bubble" configuration to rival tulips. Except you couldn't use tulips, so the bubble won't ever really burst. We will just go to a new level.

MP

[duneyman]

Originally Posted by Mike Phillips

Don't forget that silver is not only the best conductor. It is also a great radiation shield. So it is the precurser for almost all superconducting wires used in transmission and motors. Superconductivity as used in electrical storage and transmission will be the next electricity breakthrough.

There just is not enough silver for all this stuff. Never mind investment demand. Never mind all the ridiculous naked short positions by all and sundry. Shorts are going to get their clocks cleaned. But that is nothing new. The CDO market already did that to the banks. No, this is REAL. Silver is the new metal. And it is going to a "bubble" configuration to rival tulips. Except you couldn't use tulips, so the bubble won't ever really burst. We will just go to a new level.

MP

They have always been able to find enough silver despite all the hype put out by Ted Butler, Jason Hommel, David Morgan, etc..

[JesterJay]

Wrong,
There seems to be enough at the current price with supressed prices AND LOWERED INTEREST in investing in silver because of the low, low price.
IF everyone knew the true fundamentals of silver AND everyone could buy silver in a free market with NO "MANIPULATION EXTREME" by the Big Shorts,
THEN the price would go BOOM!!! due to the true knowledge of the situation.
See? You are wrong again.
If no one knows there is a shortage yet, they don't know what a SCREAMING FREAKING bargain the price is right now. When that is "figgered" out,
BAAAAAM!!! The Quickening is upon us.
And the false DIS-interest will end.
Silver, it's gonna be big.
There will never be enough,
JesterJay

Originally Posted by duneyman

They have always been able to find enough silver despite all the hype put out by Ted Butler, Jason Hommel, David Morgan, etc..

[What is Truth?]

Originally Posted by JesterJay

Wrong,
There seems to be enough at the current price with supressed prices AND LOWERED INTEREST in investing in silver because of the low, low price.
IF everyone knew the true fundamentals of silver AND everyone could buy silver in a free market with NO "MANIPULATION EXTREME" by the Big Shorts,
THEN the price would go BOOM!!! due to the true knowledge of the situation.
See? You are wrong again.
If no one knows there is a shortage yet, they don't know what a SCREAMING FREAKING bargain the price is right now. When that is "figgered" out,
BAAAAAM!!! The Quickening is upon us.
And the false DIS-interest will end.
Silver, it's gonna be big.
There will never be enough,
JesterJay

You are going to have to explain to me how that works Jester. Correct me if I'm wrong. 1. There is a true physical shortage of silver out there. 2. The "shorts' manipulate the price down through fiat dollar buying power world-wide. Then, 3. How come we don't see any physical shortage of silver? That's like saying if the shit hits the fan those in power could reduce the price of food by putting it on sale. Sure they could, but they would run out real quick. Why then haven't we run out of silver yet? How are they pulling rabbits out of the hat? The LOW INTEREST you mentioned above isn't because of manipulation. There is low interest in silver by the public because the free maket is at work. Maybe they remember the price manipulation up of silver by the Hunts and those who got burned by it. Sorry, I'm not trying to be difficult, but none of this manipulation talk makes sense anymore to me.

[akak]

Originally Posted by What is Truth?

You are going to have to explain to me how that works Jester. Correct me if I'm wrong. 1. There is a true physical shortage of silver out there. 2. The "shorts' manipulate the price down through fiat dollar buying power world-wide. Then, 3. How come we don't see any physical shortage of silver? That's like saying if the shit hits the fan those in power could reduce the price of food by putting it on sale. Sure they could, but they would run out real quick. Why then haven't we run out of silver yet? How are they pulling rabbits out of the hat? The LOW INTEREST you mentioned above isn't because of manipulation. There is low interest in silver by the public because the free maket is at work. Maybe they remember the price manipulation up of silver by the Hunts and those who got burned by it. Sorry, I'm not trying to be difficult, but none of this manipulation talk makes sense anymore to me.

I do wonder about the manipulation of the prices of the precious metals myself. On the face of it, it would seem that if the prices are being held artificially low, then real, obvious, unequivocable shortages should be the result.

Now, there is a hitch in that argument in regard to gold, as gold is not like any other commodity, and does not exhibit a normal "supply vs. demand" situation, in that most of the gold that has ever been mined, and that is mined today, is held as a monetary reserve and not consumed in industry. That being the case, it seems logical to argue that the demand for gold is directly influenced by its price, i.e., holding down the price holds down the demand for it. In that sense, covert and overt official actions to supress the price make sense, and could have the desired effect.

However, the same argument cannot be made for silver, as most of the mined silver IS used and consumed by industry, with what could be called "monetary holdings" (investment silver) being less than 10% of the total annual supply until last year, and still well under 20% in any case. Here, it seems to me that actively suppressing the price would increase demand, and hence eventually diminish the supply. So why has that not happened with silver yet?

I would have thought that the net result of suppressing the price of both silver and gold would be a decrease in the silver:gold ratio, due to increased demand at an artificially low price, not a steadily rising increase in the ratio as we have observed over the last few decades.

[Mike Phillips]

I have wrestled with the same question. I think the only explanation which makes sense is that the regulators are simply not willing to stand up to large market participants, and those market participants are attempting to protect large short interests in both gold and silver and that Government is complicit in this arrangement, one way or another. If you listened to Harry Marcopolis' congressional testimony on the Madoff situation, the fact that the SEC ignored his many warnings can only, in my opinion, be explained by his own belief that SEC lawyers have an unwritten law not to mess with the "big boys" because they themselves wanted to get lucrative jobs with these firms at a later stage of their careers. This career driven motivation can only continue in the long term with the implicit support of government.

In modern society, the whole economic structure depends on our willingness to accept that the fundamental unit of value is basically a "bit and byte" in a computer which we are asked to believe has intrinsic value. In your core, are you really content that your monetary wealth is just this "fiction"? While governments have kept monetary expansion under reasonable control, this illusion has been sustainable. But in this World of "quantitative easing" when governments flip switches to create huge increases in the monetary base, the whole fabric of fiat currency is under strain globally. When the genie is finally out of the bottle, real assets are revalued and money wealth comes under question. This is more than an inflationary spike, it is a fundamental shift in the monetary value system. There is no time in history when debasement of the currency has not resulted in a return to using hard assets, barter, or precious metal backed currency as the medium of exchange. This time will be no exception.

The big question is one of time horizon not outcome which is not in doubt. When will this happen? How will we know than the dam is about to break? I think one trigger will be backwardation in the futures market. When confidence in the market mechanism is such that current gold/silver is traded at a significant and sustained premium to the price for future delivery, the mechanism is about to break down. But whether that will occur in a few days or a few decades I do not know. What I do know is that I own some physical metal and it is not for sale.

[DaveKimble]

It is all very well to point to silver's conductivity and imply a booming future, but the reality is that when renewable energy becomes a significant part of the energy mix, the demands for price competitiveness will mean copper will resurface as the conductor of choice, and the silver boom will fade. Silver will remain the "boutique conductor", but will never be the "common conductor".

The most important reason for the price of silver to be wherever it is, is the cost of the energy needed to find it, mine it, purify it and transport it to market. As the price of fossil fuels increases due to Peak Oil (2008), Peak Gas(2020) and Peak Coal (2027), the price of silver will be forced through the roof by its energy costs, making it less attractive than cooper.

The price "spike" in oil last year would have continued to MUCH higher levels if it hadn't been for the GFC. The current collapse in oil price has led to a halt in new discovery, development and infrastructure maintenance, which will prove to have been a very costly short-sightedness when demand picks up again. It is almost certain that we will never see 85 million barrels per day production ever again, due to this bottleneck effect.

As one of the most energy-intensive materials, silver will be priced out of the market for large-scale applications.

Sorry, but no free lunch in thermodynamics.

Dave