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Silver Wheaton Corp. Message Board

  • hapiwondrer hapiwondrer Sep 10, 2013 9:00 PM Flag

    Backwardation & PM mining companies

    Attempting to look into the future the following questions arise:

    Since gold and silver have entered into “backwardation”, what is the implication under the higher levels of it for PM mining companies like SLW or others in that industry?

    If any have read what Antal Fekete has to say about this he states that PMs go into hiding as fiat paper money can no longer buy anything. We may be seeing glimmers of this with the long delivery times from PM vendors.

    Getting back to the implications for PM miners, how will they survive if no one will accept fiat currency? Doesn’t this imply that some other commodity with real value will have to be used? There doesn’t seem to be anyone discussing this, such as listing what would replace fiat currencies for some tradable something (let’s call it a widget). What would be considered tradable “widgets” for PM mining shares? What might be used are agricultural commodities, which obviously would not be as liquid as specie. Maybe the question should be; what might be the liquid sort of widgets that could be used in place of counterfeit fiat bankster printed criminal monopoly “money”. Is the answer hidden in the concept of the Real Bills Doctrine which could bring specie back into wide circulation?

    It would seem that the answer to these questions needs to be understood by all who wish to survive in a fiat fueled hyperinflationary environment. Please provide your list. In the meantime one will be searched for on the Internet, if it exists. Maybe these are the types of questions that could bring on NSA censorship, or drone strikes against those fielding or answering them. But don’t let that stop you from replying. ;

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    • Initially, at least, one could see society gravitating to various commodities especially those both essential and those that serve to offer comfort. This situation, however, would no doubt stratify by markets... if they still remain in place, which Ann Barnhardt says is extremely unlikely. While I'm uncertain that things will devolve into a Mad Max scenario, I must also state that there is a possibility that we might all endorse exactly that scenario just so that we can get some relief by removing the BIG "G" from all equations.

      • 2 Replies to moses_on_wall_street
      • Your reference to your attachment to Ann Barnhardt’s views is shared, somewhat. However (hopefully the following will not go beyond TOS guidelines) her attachment to Catholicism seems to be blind. Without going into the gory details of the conduct of priests and the usage of parishioner money to protect their wrongdoing her Catholic religious loyalty is incomprehensible and speaks to a sort of hidebound mindset. Some things simply cannot be reformed (“power corrupts and absolute power corrupts absolutely”), which brought a previous majority to this country with the realization. In other words many, at the time, realized a schism was the only alternative.

        Your reference to “the BIG G” whizzed by as incomprehensible. It is assumed you meant by “G”, gold. If by removing it, it is because it has become the standard anchor for exchange rather than the current fiat system few here would disagree. That was the reason for referring to the Real Bills Doctrine. It is assumed that a fiat currency meltdown would then be replaced first by the mechanizations of the Real Bills Doctrine which would filter down throughout economies installing once again the gold standard despite remaining bankster opposition.

        ‘Nuf said as this topic is about where we are all headed if the dissolution of the Federal Reserve does not take place, and how we can protect ourselves when the wheels come off the Fed’s corrupt un-Constitutional concept of money. However all things are to some extent interrelated such as economics and religious views.

      • 99% of us will not want to do without electricity and try to buy it with something, has to be currency of some kind , hard to see trading potatoes or something to the light company

    • Will be a long time before the dollar is not accepted in trade, price will have to double a few times and that will be noticeable. The rate of price doubling may be important etc. They can cause a shortage of dollars anytime they want to make it seem more valuable, they just don't want to do that as it will cause instant depression, likely will happen, deflation, no matter how hard they fight it. I like gold and silver, believe in them, but they do nothing until they are spent and there isn't enough to function as money world wide. maybe it will come to a dollar based on a basket of commodities, but they will let this one fail first and foreclose on every thing with a loan on it, , but that didn't work too well in the depression, homes were sold on the courthouse steps for 4.00 back taxes, and there were no takers. If the cities lose their tax base, they will default on their bonds etc, on and on. Read Full faith and Credit by James Cook, nation will have to decide to be honest and declare bankruptcy and start over

      • 3 Replies to sharpie3444
      • “I like gold and silver, believe in them … and there isn't enough to function as money world wide.”

        This is a fallacy. In order to expose the fallacy let’s use a study of inequalities.

        Suppose instead of Earth having 4 billion people, let’s imagine that it only has 100 million but there is as much gold that has been mined as exists today. That means it would be of much less value in trade (exchange). If we consider the total quantity of gold and the amount that is used in trade as a velocity number, the velocity would be very low.

        Now if we look at current reality there would be much less available to be used in trade on a per person basis. Therefore its circulation velocity would be much higher and it would buy much more than what is in the previous example. But it could still function as a medium of exchange. When gold and silver were the mediums of exchange, per the US Constitution, the country had prosperity that was the envy of the world.

        What this means is that those who possess it would find that it increases in value over time due to increasing scarcity. That is why the banksters hate it as an exchange medium because it would drain their economic power and transfer it to the People.

        The current downturn in PM prices is manipulation to discharge from the hands of commoners the PMs they possess. This is to fill the empty promises to countries that have placed their gold holdings for safe keeping at the Federal Reserve and banks like JP Morgan, which they no longer hold. Germany has been told that their request of a return of their gold cannot take place for some years. Meanwhile the banksters are scrambling to extract it from private hands using scare tactics, such as what we are currently seeing in this PM downturn, to fulfill the requests from various countries to repatriate theirs. The timeline for doing this escapes the imagination of most with long range manipulative tactics that convinces them to capitulate. DON’T DO IT.

      • Gold supply is down 36% this year. China or Russia can easily take the remaining supply off the market if they wish. Things are going to get very interesting as the currency wars continue and the battle for resources accelerates.

      • What happens when supply is curtailed because of the anticipation of further depreciation of the fiat? After all, at the end of the day it has no connection to value; it is merely pretty pieces of paper.

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