If you are like me, then you are a self-centered, greedy little pig whose avarice knows no bounds because you want to get enough money to go far, far away and start over with a new name, a new identity, maybe new fingerprints and some snazzy new shoes, and with pockets full of luscious spending cash, albeit in used currency with random serial numbers.
As such, you find yourself driven to accumulate statistics that would indicate a course of action that is going to be so profitable that you actually salivate down the front of your shirt at the sheer tonnage of money you will make, and you find that you start spending a lot of time daydreaming about the debaucheries you will be able to afford, each more licentious and depraved than the last, until even YOU are repelled by your own disgusting excesses, like if this silver thing works out like I think it will.
If so, then Jason Hommel of silverstockreport.com is just the guy you are looking for, as he is a treasure trove of statistics concerning silver, such as the fact that the world “uses up more silver each year (about 850 million ounces) than the world mines (about 600 million ounces),” which seems such an incredible 250 million ounce imbalance that people often stop me on the street and say, “You poor man! If I give you some money, will you please quit screaming about how my husband, my children, my family, my friends and I are all a bunch of morons because we are not buying silver Right This Very Minute (RTVM)?” and I say, “Yes! Yes, I will stop if you give me money!”
The point is that, as Mr. Hommel explains, “existing demand can only be met by selling existing inventory”, which can be extremely finite in a hurry, which is a phrase sometimes still likened around the office to that time where I got caught on camera gluttonously going through the last few boxes of a small inventory of Girl Scout Thin Mint cookies that I happened to find in a desk drawer in the office of a co-worker that he stupidly left unlocked.
So, if inventories of silver, like the last inventories of a delicious seasonal cookie, are not infinite, how much silver is actually out there, for crying out loud? Mr. Hommel, realizing that I am obviously not in the mood for a lengthy conversation as I am suddenly fixated on mouth-watering milk chocolate surrounding a crunchy mint cookie of sublime qualities, salivating like Pavlov’s dog with a lot of foamy drool coming down my own chin, and I am sure I looked disgusting as hell.
So, to save time, he handily condenses the relevant statistics by saying, “Estimates on ‘above ground’ silver, in refined, deliverable form have ranged from 300 million ounces to 1 billion ounces, to about a high of 4 billion ounces if you include jewelry and flatware, up to 20 billion ounces if you include all forms of silver that have not ended up in landfills, out of the total of 43 billion ounces of silver estimated to have been mined in all of human history.”
Ah! Now I can work backward from half the world’s population achieving a technological societal wonder by using up most of the 42 billion ounces of silver ever mined, to the coming theoretical price of silver now that the other half of the world wants the same thing, but having to do it all on a few measly billion ounces of silver that have been left over! Hahahaha!
As James Cook of InvestmentRarities.com says, “In Asia alone, ten times the population of the U.S are now getting the money to buy products that require silver. Meanwhile, the supply of silver diminishes”!
So, naturally, with this kind of building demand, I’m a guy who is an investor in silver, and who would be a BIGGER investor in silver if my stubborn wife was more reasonable about how to apportion my pitiful income among the various clamoring creditors and greedy children, and I think she should let me put more money into the “Family Silver Investment Fund (FSIF)”, which used to be called “Daddy’s Secret Getaway Fund (DSGF)” until one of the damned kids was snooping around in my desk one day and found the account balance with the “odd name” and showed it to my wife.
But this is not about how you can change the name but everything remains the same, which I just noticed rhymes. Hmmm! “You can change the name, but everything remains the same”! Perhaps I could find a way to musically work it into my latest tune, “Get Gold, Silver And Oil, Or Eat Financial Death By Inflation, You Ugly Moron!”, which I pronounce “Mo-Ron”, which sounds so ghetto, which I pronounce “get-toe”!
No, the point is that you would be buying gold, silver and oil if you had any smarts, or even a vague, passing familiarity with the entire historical record of what happens when a government is so corrupt that it deficit-spends, and especially when it compounds its folly by paying for it with the creation of a fiat money!
And it is doubly especially about how you would be buying gold, silver and oil when the state and local governments do the same borrow-and-spend-o-holic thing, and triply especially when the people themselves have borrowed and spent so much that they cannot pay their debts because they owe around 400% of their income! Hahahaha!
Then, as I suggest, combine all that with an estimated billion ounces of silver sold naked short (the actual silver doesn’t exist) in “paper silver” transactions, plus what Mr. Cook calls a “runaway market when the short sellers on the commodity exchanges are trying to cover, and the nonexistent silver in pool accounts is being bought back,” with huge additional demand coming from “shell-shocked industrial users, attempting to stockpile silver to keep their doors open, and inflation-ravaged investors pouring in as the price rises”, and suddenly the case for buying silver now is compelling!
And as a guy who actually takes a lot of calming medications because of compulsion, I can tell you, as an expert on compulsion, that the case for silver is compelling! Compelling, I tells ya! Compelling! Compelling!
Until next time,
The Mogambo Guru
for The Daily Reckoning Australia