Silver Stock Report
by Jason Hommel, May 20, 2006
This email can be accessed online at:
Who prospers more: honest men or liars? A nation of honest men, or a nation of liars?
That is the question when determining whether a society will be more prosperous if it uses honest weights and measures of silver and gold as money, or paper as money.
So many silver and gold investors still seem to be absolutely terrified of silver and gold going up in value beyond $5000/oz. or $40,000/oz. Why do so many of you, my readers, assume that there must be riots and panic and social disaster if silver and gold goes up? Were there riots in 1980? There were lines at the bullion shops, and there were about as many buyers as sellers, all the way up, and many coin shops turned over their entire inventory several times in one day. You could even go to the front of the lines at many gas stations if you had silver coins.
Perhaps the transition to using silver and gold as money will be peaceful and prosperous. There does not need to be shortages of food, or riots, or wars.
The key is for governments to allow trade to continue. They key is to allow people to choose to use silver and gold as money now, so that there will exist a stable alternative as paper money fails. And as electronic silver and gold payment systems grow on the Internet, and with encryption, it may be increasingly impossible for governments to restrict trade in silver and gold in the future.
If governments forbid using silver and gold, they will not destroy silver and gold; that kind of law destroys the markets (leading to food shortages) and ultimately destroys governments!
There has been much propaganda to make us think that if silver and gold goes up, it will be bad for the economy. But that is a socialist lie, designed to make us think we are doing something good by holding dollars, instead of silver and gold.
God told mankind to use honest weights and measures in trade. Did God give us this commandment because he wants us to be mired in poverty? No. God gave us this command, and all his other commands, because God wants us to prosper beyond measure, overflowing with bounty, as a shining example of the good that God wishes for mankind.
In the Holy Bible, in Deuteronomy 25:15, Moses actually gives a solid reason for using just weights and measures in trade: it will lead to a long life!
Deuteronomy 25:13-16 "You shall not have in your bag differing weights, a heavy and a light. You shall not have in your house differing measures, a large and a small. You shall have a perfect and just weight, a perfect and just measure, that your days may be lengthened in the land which the Lord your God is giving you. For all who do such things, all who behave unrighteously, are an abomination to the Lord your God."
In contrast, I envision that many of today's oldest people, who own most of society's wealth, will become impoverished, since their savings is largely held in overvalued bonds and housing. Thus, their days will be shortened, as they may face having to go back to work, or have less money for medical care.
For many Bible verses that God wants His people to prosper, see:
Even the pro-gold web sites are filled with propaganda that makes us fear the return to gold. Here's a typical example, a common authoritative quote showing the problems with paper money:
Robert Hemphill was the Credit Manager of the Federal Reserve Bank in Atlanta. In the foreword to a book by Irving Fisher, entitled 100% Money, Hemphill said this:
If all the bank loans were paid, no one could have a bank deposit, and there would not be a dollar of coin or currency in circulation. This is a staggering thought. We are completely dependent on the commercial banks. Someone has to borrow every dollar we have in circulation, cash, or credit. If the banks create ample synthetic money we are prosperous; if not, we starve. We are absolutely without a permanent money system. When one gets a complete grasp of the picture, the tragic absurdity of our hopeless situation is almost incredible -- but there it is.
That was an interestingly terrifying description of the problem of paper money; but no solution is presented; in fact, he fears that no solution is possible. The solution must have eluded Robert Hemphill, who did, in fact, help to inspire me to search for a solution when I read another of his famous quotes on money: (and I quote this at my homepage).
"Money is the most important subject intellectual persons can investigate and reflect upon. It is so important that our present civilization may collapse unless it is widely understood and its defects remedied very soon."
--Robert H. Hemphill, former credit manager, Federal Reserve Bank of Atlanta.
So, here's a remedy for the defects of our monetary system:
My Silver Coin Proposal:
Let me continue to showcase the simple beauty of the remedy by pointing out what was untrue in Robert's first paragraph.
1. Robert assumes that there is only one way to discharge loans; but payment is merely one of many ways. There is also bankruptcy (or as God calls it, debt forgiveness, which is supposed to happen everywhere in society every 7 years, and every 50 years at the Jubilee), or monetization--printing the necessary paper money.
2. If the bank loans were discharged, there would still remain gold and silver coin. Gold and silver do not vanish into thin air; paper does that.
3. If others pay back their debts; it does not impoverish them (it improves their financial situation), nor would it impoverish me, because I'm not in debt. I do not need to go into debt to help others prosper. To help others prosper, I need to convince them that God wants them to prosper, and that God has given us very clear instructions on how to prosper.
See my article:
Bible Verses on how to Manage Money
4. We are not dependent on the banks. We only think we are, due to their deception. We ought to be dependent on the Lord Jesus Christ and our Lord in Heaven who provides an abundance of overflowing prosperity for us who follow Him.
5. People do not have to borrow money for it to be created. Yes, that is sometimes how it works. Other ways that money is created are if corporations borrow, or if the government borrows. But borrowing is not the only way to create money.
For example, when the government borrows money, and is also propping up the bond market by buying bonds as they are doing today--instead of selling bonds as they are supposed to do if they are truly borrowing money--then the government is essentially printing money, which is also called monetization. In true monetization, the government just prints money without borrowing it.
Besides, true money is gold and silver, and we do not borrow gold or silver into existence; we mine it!
6. It is not true that the only way to prosperity is through an increase in paper money printing fraud. That's like saying that the only way to get money is to steal it from others. Another way to get money is to create it (mine it, or produce other things to sell and trade, or to provide services to others), and to be giving to others! Men will prosper more by following God's laws, than by breaking them. Often it is said that "there is not enough gold to do the work of money, and therefore, we need to print more paper". This is just not true. If gold is valued more highly, there is no need to print, to create "more". Printing extra is just fraud. Valuing gold more highly, is God's way to 'create more money'. For example, today, all the world's 150,000 tonnes of gold, at $700/oz., is valued at $3.4 trillion. But at $7000/oz., the gold is worth ten times as much: $34 trillion. There is no need to print more money; men just need to value silver and gold more highly; and wealth is thus created the Godly way, as everybody's money is supposed to be worth more over time, and not less.
7. We are not “without a permanent money system”. God gave us silver and gold, which has not changed in 6000 years. We are just not using God's system. To the extent that we value gold more highly, and buy gold, and save gold, we are using God's money system. To the extent that more people use God's money system, it becomes more useful, as the trading spreads decrease, the value becomes more stable, and the value of silver and gold increases.
8. If you have a "complete grasp of the picture," the solution not "absurdly hopeless", bur rather, it is elegant, beautiful, simple, and has been in front of us for all of our lives; silver and gold. The men in power have just not publicly recognized the solution. It's a very simple choice: God's money system, or Satan's money system. We all choose which we prefer, and we choose the extent to which we will use each one, every day of our lives, by how we choose to save money; whether in silver and gold, or bonds.
To the extent that you will choose God's way: honest weights and measures of silver and gold; you will prosper. To the extent that all of society chooses silver and gold; society will prosper. So, if you want to live in a prosperous society, then buy silver and gold!
Now, I suspect I'm going to have several big questions regarding this article, so instead of trying to answer 100 emails, let me see if I can address a few of these concerns right now:
1. Jason, if the dollar dies, and we all use gold and silver, how will we trade? Can we send gold coins in the mail to pay bills or buy a burger?
--Well, even today, bullion dealers ship silver and gold in the mail via registered and insured mail, and it works just fine. But for small purchases, no, you don't use gold, you use silver. But people can trade just as easily with silver and gold. There are electronic gold payment systems in existence today; and these will surely grow in number as demand increases. You can send grams or fractional grams of gold or silver, electronically. And for very small purchases, pure copper coins also work.
2. Jason, there's no way we can pay for all the oil we need, if we use silver and gold.
--I believe that's not true. If silver and gold are properly valued, we can buy or develop, all of the energy we need. I believe the energy problem is politically created, and that the solutions will be free market solutions.
3. Jason, India is filled with silver and gold, and it has not made them prosperous.
--I don't know whether or how much India is prosperous; but India is also not a mostly Christian nation; so many of their values are different than ours; and I think that results in misplaced priorities which may impede economic development, growth, and prosperity. For example, they have a rigid caste system, which is the opposite of an upwardly mobile entrepreneurial system like we have the U.S. To the extent that the financial elites in the U.S. try to protect their own paper money positions, at the expense of the free market, they, too, are stifling change and growth of true prosperity.
4. Jason, many Churches in the U.S. started advocating silver and gold in the late 1970's, and they did not prosper, but were burned by declining prices for 20 years. Why didn't God prosper them?
--That's probably the toughest question. And maybe God should answer it; and maybe the people who lived through it, should answer it. I was 10 in 1980, and I've prospered by it because as I child, I saw the confusion and dismay of so many adults at that time. And so, I asked them, "If you are so concerned if gold keeps going up, why don't you just buy gold, and stop worrying?" And they could not answer that question! And so, I always had a fascination with gold. By my mid 20's I questioned why I should work so hard for paper money in a bank that didn't even keep my paper money in it! And, by age 36, here I am, prospering by writing this article and others like it, on why we should not worry if gold and silver go very much higher!
After all, since gold is a luxury item, then nobody can be hurt if gold is valued very, very, highly.
But how do we explain the drastic drop in real values of silver and gold from 1980 to 2003? Well, there was central bank selling, which has provided the opportunity of cheap gold, as explained by gata.org. Further, high interest rates on bonds convinced people to become usurers (abandoning Godly values), and there was a futures market introduced that convinced people to become gamblers (again, abandoning Godly values).
But in the next rise of silver and gold, I don't think bonds will work, because bonds are going to be destroyed as interest rates rise, and I don't think the futures market will work, because it will likely see defaults, and be discredited.
But back to the question: why didn't a generation prosper? Well, according to the Bible, a generation is 40 years; so let's let the next 14 years answer the question of whether people who bought gold at the peak in 1980 will ultimately prosper.
For more on this topic, see my prior article:
Rising Gold Prices Will Help The Economy - 02 December 2003
The Bible is not against silver and gold!
For questions on James 5, or Ezekiel 17, see my article:
Gold and Silver in Bible Prophecy
For questions on Matthew 25, see report #48
Excerpt the section titled, in very large print:
Scriptures supporting gold and silver as money, and against paper money.