 Silver story
of the year
Coin dealers wanted
Sean Rakhimov
December 29, 2004
Editor: Silver Strategies
"What is the most important
silver news in the last month?" asked David Morgan as we sat in his
office in the beautiful countryside just outside of Spokane,
Washington.
"The Mexican 'Bill'!"
promptly answered this
writer, referring to the communiqué sent by the governors
of all 31 states of the Mexican Republic to the Ways and Means
Committee of the Mexican House of Representatives, in which they
expressed their unanimous support for the monetization of silver
and urged the Committee to approve a bill which aims to achieve
precisely this objective. (See original article
by Hugo Salinas Price).
"What is the most important
silver news in the last year?" continued Mr. Morgan, nodding in agreement with
my reply.
"The Mexican 'Bill'
. . . ?" responded
yours truly, this time with less confidence.
"What is the most important
silver news in the last decade?" further inquired Mr. Morgan, again
nodding with approval.
"The Mexican 'Bill'!" blurted out Mr. Morgan seeing that
I had paused, trying to remember all that has happened to silver
in the past ten years.
There you have it from Mr. Silver himself:
The most important silver news in the last decade is the 'Bill'
on monetization of silver submitted unanimously by the governors
of the Mexican states to their House of Representatives.
"Have you seen it in
the Wall Street Journal?"
launched Mr. Morgan again, unaware that I don't read this revered
outpost of mainstream economic media. "Think you will
read about it in Money Magazine?" he continued to muse,
as we savored a warm and sunny winter day in the week before
Christmas. An unusual warm front, or perhaps lack of a cold one,
had settled over the great Northwest and it felt almost like
spring.
I wondered if this was the
beginning of a new spring in the history of silver. It must be,
for the only people who picked up the story were the fellows
at Le Metropole Café
and a few other precious metal sites. David Bond of SilverMiners.com
followed up with an excellent
piece of his own. But I have yet to see it on CNBC and I'm
not holding my breath either.
I have had plenty of time to
ponder the implications of this event. Most likely the 'Bill'
will not be passed in Mexico. Not yet anyway. But the psychological
effects from its consideration by the government of a major country
(one might argue about Mexico being labeled 'major,' but I could
not bring myself to calling it 'minor') should be lasting. If
you haven't heard about this groundbreaking event folks, please
adjust your radar - this kind of information is not to be missed,
especially if you care about your financial wellbeing.
Back home, in an effort to
do some last minute holiday shopping, I decided to visit the
two coin dealers I know in New York City. That's right, in the
heart of New York's famed Jewelry District on 47th Street there
are a total of 2 coin dealers. Guess what? There were
two coin dealers, as in 'used to be!' One of them
- let's call him "Jeff" to extend the courtesy of keeping
our conversations private - has been talking about retirement
for a while. Seeing my keen interest at one point, Jeff offered
to sell his business to me. He was even willing to train me for
a few months, to teach me the tricks of the trade and to pass
on all pertinent knowledge he gained during a 35-year
career. On numerous occasions we talked at length about the
rising silver price and its impact on bullion markets. Jeff told
me of the past. I ventured to discuss the future, shared my views
on the silver price surpassing prior highs sooner
rather than later and tried to convince him to hang on.
"There is no money
in bullion," Jeff
shook his head in disbelief, packing another box. What could
I tell this dealer with a life-long experience in the coin business?
That bullion is money? That the charts are telling a different
story? That the dry spell is over?
"Inevitable does not
mean imminent,"
I reminded myself. Everything takes longer than expected. We
do what we must today. And today there is a coin business up
for sale with buyers nowhere to be found.
"Take it all, I will
give you the bags 'at face' " - (The dealer was referring to "junk
bags," pre-1965 US silver coins typically sold in canvas
bank bags) - uttered Jeff,
resorting to the marketing tactics worthy of flea markets, but
not the noble metal which 96% of polled Mexican citizenry want
as their money. This dichotomy - despised in New York and revered
in Mexico - typifies the precious metals market and ensures that
the bull market will be long and prosperous.
Further evidence can be found
in the stock markets - this past week I have been contacted by
3 exploration companies about potential private placements. Off
the top of my head, I can name perhaps another 3 that will be
raising capital early in the New Year. One of them is priced
at 20 cents; they can't seem to give the shares away. And this
at a time when the Dow is trading at a new three-year
high. I know these exploration stocks are risky and not all of
them will make it, just like not all coin dealers will make it.
Still, we are not talking about slim casino odds here!
Even if nothing else matters
to you, what should is whether you will make it when silver and
gold return as money. It could happen first in Mexico or Malaysia,
but once it happens in one country, others will follow. They
always do. We could be among the first or last to treat silver
and gold as money - the choice is ours.
On an offbeat note, according
to studies reported by Bill Bonner's Agora Publishing, Mexicans
topped the list of the happiest people on earth . . . a coincidence?
Sean Rakhimov
Email: Sean@SilverStrategies.com
Information
contained herein is obtained from sources believed to be reliable,
but its accuracy cannot be guaranteed. It is not intended to
constitute individual investment advice and is not designed to
meet your personal financial situation. The opinions expressed
herein are those of the author and are subject to change without
notice. The information herein may become outdated and there
is no obligation to update any such information. The author,
entities in which he has an interest, family and associates may
from time to time have positions in the securities or commodities
discussed. No part of this publication can be reproduced without
the written consent of the author. © Copyright 2004 by Sean
Rakhimov.
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