During this very tumultuous week for precious metals prices, Chris sat down with Mike Maloney, founder and owner of GoldSilver.com, one of the world's largest bullion dealers.
Mike is a true scholar of monetary history. His reasons for getting into the bullion business have their roots in a very predictable cycle that has happened time and again over the centuries (more accurately millennia):
- A new monetary system is introduced, based on sound money (most commonly, using gold and/or silver)
- Currency (e.g., paper bills backed by sound money) is introduced to faciliate trade and commerce
- Governments begin to tinker with ways to 'print' more currency than can be fully backed (e.g., coin clipping, partially-backed notes, FRNs)
- A false prosperity ensues. Those closest to the new money creation benefit most and debase the currency further to forward their advantage.
- Reality begins to catch up with this deficit spending and the purchasing power of the currency weakens dramatically.
- The monetary system collapses under too many claims on a limited pool of sound money.
- Eventually, a new monetary system backed by sound money rises from the ashes (see Step 1, above).
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With gold, silver and Uranium stocks being out of favor one must decide if this is a problem or an opportunity. We have steadfastly refused to buy gold and silver mining stocks for the last two years and as evidenced by the HUI we feel that our decision to hold back has been vindicated. The damage done to the mining sector may not be over yet but this demise is starting to offer up some exciting opportunities in my view.
Great care will be needed in the selection process in order to generate a reasonable profit and that’s where our new venture begins. ‘Stock Trader’ has begun trading on behalf of ourselves and our much valued subscribers, all exciting stuff which we are really looking forward to, if you wish to join us then please subscribe below;
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