US Silver stockpile GONE! Bush signs bill to buy more....

Spokesman Review/Spokane ^

[BlackJack]

President Bush signed legislation Tuesday to create a new market for domestic silver in government-minted coins in what could be a boon to North Idaho silver producers.

Sponsored by Idaho's two senators and U.S. Rep. Butch Otter along with members of two other silver-producing state congressional delegations, the law enables the federal government to become a net silver buyer for the first time in four decades.

It permits continued production of the American Eagle Silver Bullion Coin and the preservation of dozens of jobs in the Panhandle.

The initiative was prompted by news that the government's 730-million-ounce strategic stockpile of silver -- accumulated in the years immediately following WW II -- will be depleted this summer.

Since 1986, about 10 million troy ounces a year have been taken from the stockpile, stamped into rounds by Sunshine Minting Co. in Coeur d'Alene and then struck by the U.S. Mint into 1-ounce investment coins.

The mint is expected to buy up to 9 million ounces of silver each year to continue production.

[BlackJack]

Buffet probably owns more Silver than the Fed. What a joke!

[Glenn]

Buffet probably owns more Silver than the Fed. What a joke!

What's the problem with that? I don't notice any silver coins in my pockets. What business does the government have dabbling in silver? Leave it in the private enterprise space.

[DeaconBenjamin]

I agree in principle, but not in this application. From the first, the U.S. coined gold and silver coins -- not to create money, as money is created today, but to provide a uniform medium of exchange. It is a public service expressly provided for in the Constitution. Without going into whether Gresham's law is at work (bad money having chased out good), the government will be, in effect, continuing to provide this public service, while retaining a substantial income stream.

In sum, there is a market for this public service; it is expressly provided for in the Constitution; it pays its own way -- not being subsidized by tax dollars; it benefits private industry as well (i.e., Sunshine's manufacture of the planchets), so I applaud President Bush's action.

[MissAmericanPie]

When was the last time anyone took a peek in Ft Knox? It's been a long time since anyone was allowed a look inside hasn't it.

[steve50]

I'd like to see some states start making gold/sliver historical "tokens" at a small markup above spot as a revenue enhancement measure instead of just taxing us to death. It should be legal since it makes no claim to be "money"

[Freedom4US]

It's my understanding that the bulk of world's gold lies beneath the streets of New York at the Federal Reserve branch there. Many nations store their gold reserves there, and when one country 'owes' another a certain amount, it's far easier to make the exchange from one vault to another rather than shipping it all over the planet. They give tours now and then, probably quite a sight.

[blackdog]

Remember that movie called "The Silver Bears"? I don't trust much these days. Especially when a "strategic" supply of precious metals is being chronicled in the news. If we are reading it, it ain't so strategic is it?

[Looking for Diogenes]

This has nothing to do with monetary policy.

the government's 730-million-ounce strategic stockpile of silver -- accumulated in the years immediately following WW II

During the Cold War the government stockpiled a variety of minerals and other raw materials in case of a cutoff of supply. Silver is a vital and strategic mineral to industry. As the Cold War has drawn to a close the government has been slowly liquidating these stckpiles.

[blackdog]

Yeah, but I still follow those Brinks trucks waiting for the doors to pop open over a bump. Remember Eddie Coyle(or was it Joey?) in Philadelphia? He picked up a few million. I figure what's a half hour lost when following a few million over pot holed streets? Better than lottery odds!

[blackdog]

The government has been selling those stockpiles. Exactly what line in the budget shows the receipts of those sales? I don't suppose anyone could actually account for it these days? If Torrecelli can't account for the grandfather clock he purchased with Chang, the whitehouse can't account for the furnishings Hillary stole, and Global Crossing can't tell you where a few hundred billion went, I don't have much hope.

[Looking for Diogenes]

This is from the text of the bill Bush signed.

Support of American Eagle Silver Bullion Program Act

Congress finds that--

(3) from fiscal year 1995 through fiscal year 2001, the American Eagle Silver Bullion Program generated--
(A) revenues of $264,100,000; and
(B) sufficient profits to significantly reduce the national debt;

(4) with the depletion of silver reserves in the Defense Logistic Agency's Strategic and Critical Materials Stockpile, it is necessary for the Department of the Treasury to acquire silver from other sources in order to preserve the American Eagle Silver Bullion Program;

[steve50]

They make a fortune off the Silver Eagle. By the time it gets to us it's about $2.50 over spot. Lot of markup for 1 oz of silver

[mykej]

" (A) revenues of $264,100,000; and
(B) sufficient profits to significantly reduce the national debt; "

I don't think that will "significantly" reduce the national debt. If the 264M was 100% profit, it would take 24,000 years to pay off the debt.

A quarter of a billion doesn't go as far as it used to. When I was a kid you could go to the movies, get a coke, and still have change left with that much. :)

[Looking for Diogenes]

FYI, a list of surplus commodities being sold by the Defense National Stockpile Center. I once read that they have a something like a one hundred year supply of Mica, at current consumption rates.

I bet you didn't know Talc was a strategic mineral.

Aluminum Oxide(s)	Manganese Ores
Antimony	Mercury
Bauxite(s)	Mica(s)
Cadmium	Platinum Group Metals
Celestite	Quinidine
Chromite	Rubber
Chromium Metal	Sebacic Acid
Cobalt	Silver
Columbium Metal	Talc
Diamond Stones	Tantalum Carbide Powder
Ferrochrome	Tantalum Columbium Concentrates
Ferrocolumbium	Tantalum Metal Capacitor Grade
Ferromanganese	Tantalum Metal Vacuum Grade
Fluorspar	Tantalum Oxide
Germanium	Thorium Nitrate
Graphite	Tin
Iodine	Titanium Sponge
Jewel Bearings	Tungsten Ores, Concentrate, Carbide, Ferro & Metal Powder
Kyanite	Vegetable Tannin Extracts
Lead	Zinc
Manganese Metal

[blackdog]

Uhmmmmm...I just did the quick math. Can I get that price on buying silver? At fourty cents an ounce(assuming they only sold 600,000,000 of the 730,000,000 ounces, that is just giving it away! With something as easy to account for, since it is not amorphously floating about the carribean in some elaborate tax dodge, I am hopeful someone has some splainin to do!

[D.P.Roberts]

So if this was signed Tuesday, why has the silver price dropped since then?

[Sacajaweau]

This "VOTE" is for bringing back silver coins.

Frankly, I'd like to see all silver and all gold coins and get rid of the damn pennies, nickles and paper.

The object of our system seems to be going in the direction of "no tangible currency", only an "in and out" money system (totally traceable) via debit cards.

Sac

[blackdog]

Gives a wholely larger definition of "Counting the silver before they leave" Doesn't it?

[DoctorMichael]

While he's at it, he should also allow the drawing down of that 6 to 9 month supply of POWDERED MILK that the Gub-mint has been dumping down mine shafts (to replace the silver they pull out of there, I guess).

Powdered Milk, you say? Hmmmmmmmmmmmm.............and who would benefit from the stock-piling of Powdered Milk, and the concomitant price-support this type of artificial price-fixing provides?................Jumpin' Jim Jeffords?

It's nice to have "strategic" stockpiles of some substances so our economy is not interrupted, but a lot of these programs are truly pork barrel projects that distort the market.............and were originally started by some congress-critter in the dim past.

[norraad]

I suspect Dr. Evil{little finger up to mouth}, watch it be part of Austin Powers IV.