US, world headed for 25 year depression: Jim Rickards

US, world headed for 25 year depression: Jim Rickards

“When I use the phrase 25 year depression, it sounds extreme but it’s not. We had a 30 year depression in the United States from about 1870 to 1900…The Great Depression lasted from about 1929 to 1940. The U.S. is in a depression today.” Well, it's been in the works for

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Canadian banking haven myth exposed

Canadian banking haven myth exposed

"One of the reasons that Canadians (and international commentators, other finance ministers and global financial institutions) buy this Canadian banking fairy tale is the way the government accounts for the money borrowed to support the banks." The sorry spectacle of Conservat

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Get rid of your mortgage, loans, because interest rates set to rise

Get rid of your mortgage, loans, because interest rates set to rise

Get rid of your loans, guys and gals, because we are going into a high interest rate period. Very high. It will be the equivalent of going into the double digit interest rates we had in the 80s where many people threw their house keys at the bank and we had record numbers of ba

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E-cigarettes save lives, money

E-cigarettes save lives, money

"We know that cigarettes have thousands of chemicals in them and we know that they are killing us. They have been for over a hundred years. So now, the e-cig industry comes along with only one or two chemicals in their mixture and people are freaking out over these as well. Whe

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US inches closer to big bank charges

US inches closer to big bank charges

Federal prosecutors are nearing criminal charges against some of the world’s biggest banks, according to lawyers briefed on the matter, a development that could produce the first guilty plea from a major bank in more than two decades. In doing so, prosecutors are confronting

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Canada’s home sales top predictions; why a real estate crash is inevitable

Canada’s home sales top predictions; why a real estate crash is inevitable

“The assurance of relatively low borrowing costs has likely given home buyers confidence while rising home values have kept new listings at a healthy level. Stable employment has provided some assurance to owners and buyers alike.” Our website is back after many months of

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Comparing today’s recession/depression to the 1980 recession

Comparing today's recession/depression to the 1980 recession

"Much like today, Americans were concerned not only with high unemployment but increasing budget deficits in the early 1980s. A September 1983 Gallup poll found that three-fourths of the public agreed that the federal government's budget deficit was a great threat (42%) or some

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Why savers are getting screwed

Why savers are getting screwed

"Without the intervention of economic policymakers, interest rates would be naturally higher. That would increase the cost of borrowing for businesses and consumers, but there would be some offsetting economic benefits. Savers are getting screwed by the current monetary policy

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Geithner admits USA bankrupt to US Senate

Geithner admits USA bankrupt to US Senate

"Never in our history has Congress failed to increase the debt limit when necessary. Failure to raise the limit would precipitate a default by the United States. Default would effectively impose a significant and long-lasting tax on all Americans and all American businesses

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World economies on verge of currency revaluations to deal with debt

World economies on verge of currency revaluations to deal with debt

"It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning." -- Henry Ford Basically what the world central banks are doing is increasing their money by devaluin

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Is Obama the next Mugabe of Zimbabwe?

Is Obama the next Mugabe of Zimbabwe?

"America, Britain, Japan, Germany, France, Sweden, Holland, Norway, Canada and Australia make up the Fishmongers Group and their meeting on Tuesday will deliberate on the state of the inclusive government, debt relief, public finance administration and the controversial economi

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US raiding foreign countries with dollars, not soldiers

US raiding foreign countries with dollars, not soldiers

""The United States is going to China and saying: we want you to commit economic suicide, just like Japan did. We want you to follow the same thing: we want you to revalue your currency, we want you to squeeze your companies, we want you to go bankrupt,” says Michael Hudson,

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Content By: The Coming Depression Editorial Staff (dates cited below)
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silver haven

“particularly gold and silver, are likely to remain underpinned as concerns about the stability of the Mideast region continue and investors opt for safe-haven asset types,” said James Moore, analyst at FastMarkets.

As usual the report fails to adjust for the increase in the price level, when comparing silver’s price today and in a former time. If we adjust for a change in the price level, reflecting purchasing power of a quantity of silver (or any other commodity) the price of silver would have to be roughly $85 to $90 per ounce to equal the REAL (price level adjusted) value it reached in 1980. But this does not reflect opportunity costs of holding silver during that period, which would be substantial since silver does not pay a dividend (but actually costs money to keep safely.)

The game is all about who has the lowest MER ( management expense ratio). Some call it an administration fee. Anything above 60 basis points these days is not competitive.

real silver price

Bullion Management Group (BMG) has admin fees that are through the roof ( approx 2.4% )compared to other precious metal vehicles. They would be my last choice. Also expensive redemption clauses. Illiquid.

Sprott’s ( PHYS – NYSE) are lower but still about 12 basis points higher than Central Fund ( Central Fund of Canada- Cef.a -tsx ) which is 40% silver. Its listed on the NYSE . Problem there is you are exposed to the U.S dollar by owning it in the U.S.

The best way pure silver play is Silver Bullion Trust , also by Central Fund ( SBT.un on TSX ) . Its admin fees are approx .005 ( 50 basis points) . Lowest MER in the silver world. While the other silver funds have hardly moved this one has made people a lot of money since it listed 18 months ago. Management has 30+ years experience, well run. All holdings stored in Canada at CIBC.

Claymore also has a silver fund but it also has much higher admin fees which are also full of extra hidden expenses. We estimate 80-100 basis points after all is said and done . They hedge currency which is expensive and that expense comes out of shareholders pockets as does the tax implications from it. It and has suffered massive redemption’s since its inception. The funds market cap is down about 30% from its peak. Liquidity now a problem. They store a large percentage of its holding in NY and London which could be bad from a confiscation point and withholding tax perspective.

There is of course also SLV . However it is riddled with controversy that it holds very little physical and its sub custodians have turned it into a derivative nightmare.

David Morgan Explains Why Silver Is Catching Up, Why It’s Broken Out and Where It Goes From Here

David Morgan: “The major monetary metal in history is silver, not gold.” – Nobel Laureate Milton Friedman in an interview with James Blanchard at the New Orleans Investment Conference. November 7, 1993. The above quote is fact of monetary history but few in the West study or know silver’s history. Yes, gold is money but silver has been used as money more often, in more places, by more people than gold ever has.

Daily Bell: Why has silver been known as the peoples’ metal?

David Morgan: Because of value per unit, as this interview takes place gold is about $1400 US per ounce and silver is about $25 per ounce. Since most transactions are small daily transactions by all people it is known as the peoples’ money. Silver buys your small items—food, water, energy, and clothes for example. Large settlement purchases would be done in gold.

Daily Bell: What is the gold/silver ratio and where is it today? Has it closed the gap since we last spoke?

David Morgan: It is the price of gold in dollars divided by the price of silver in dollars. As of this interview that would be 1400/25, which is 56. The ratio has moved from 68 to 56 in the past six weeks and it has moved in favor of silver since our last interview. Source: Silverseek (1)

David Morgan is probably correct that a big market correction will force a rash of liquidations to cover margin that will hurt bullion in the near future and short term I’m keeping my powder dry to add silver on that plunge.

We also implore people not to buy paper products unless its a Central fund product. Paper whether its futures, ETFs or bullion certificates are not fully backed and there is a good change of default in the silver market.

Always buy physical silver

It is recommended by most experts to take physical delivery. The paper market is a sham and will bust when the margins get called. There isn’t enough silver to come close to meeting the paper demand. Silver is even a tighter market than gold.

Be very wary of the guys toughing paper. You know where that got us. Use common sense. Would you feel better with it in your hand or some player in NY on his way to an airplane as the market calls for delivery.

Without it in your basement you have nothing but toilet paper.

References:

(1) Silverseek

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