Jim’s Mailbox

Posted at 9:58 PM (CST) by & filed under General Editorial.

Dear Jim,

I was reading your latest article and was very alarmed – I have been up most of the night in regards to these 3 comments and would greatly appreciate your thoughts.

I am currently totally invested in bullion 65 % gold and 35% silver.

Can you please help with these 3 ideas …

  • Silver will demonstrate the fact that it is more an industrial metal than a precious
  • Silver is not a currency because it is simply too HEAVY to settle debts or to be universally fungible.
  • Silver performs best when there is reasonable industrial demand and distrust of currency. When this happens rounding up the gang and their money will have a lot to do with which party is elected.

Also are saying that silver is unlikely to recover from this point in time and not likely to track gold at at least 90-100 to 1 ratio? THIS WOULD BE A MAJOR CONCERN FOR MANY INVESTORS AND I THINK IT WOULD BE VERY HELPFUL FOR US ALL

Thank you so much – I do realize your time is valuable.

Many kind Regards
CIGA Brad

Dear Brad,

Silver will perform with gold.

My concern is that after $1200 in gold, silver may not keep pace with gold due to its industrial demand component.

That is 100% consistent with what I have said for years.

What I said is absolutely true, but you give it too much of a bearish interpretation.

I never in any way made a bearish prediction for silver.

I said be realistic as markets move up as what I told you, in my opinion, is correct.

All the best,
Jim

Jim,

It just keeps getting worse…

…averaged a record $437.53 billion per day in the week ended October 15, topping the previous week’s $420.16 billion per day

God Save Us,
CIGA Rick in Missouri

Banks borrow record $437.5 billion per day from Fed
Thu Oct 16, 5:14 PM ET

NEW YORK (Reuters) – Financial institutions ran to their lender of last resort for record amounts of cash in the latest week, under extreme pressure from the worst global financial crisis in a generation, Federal Reserve data showed on Thursday.

Banks and dealers’ overall direct borrowings from the Fed averaged a record $437.53 billion per day in the week ended October 15, topping the previous week’s $420.16 billion per day.

Some analysts are concerned that banks’ dependence on Fed lending might become long term and difficult to change.

“The banking system is going to become addicted to this very cheap money. Unwinding it will be very difficult,” said Howard Simons, strategist with Bianco Research in Chicago.

More…

Dear Rick,

See you in Weimar.

Regards,
Jim