The moral and ethical reason why we invest in silver

December 1, 2003

With what started out as an attempt to stimulate a debate in the silver community which I thought was desperately needed as the "exclamations" were getting very boring- I got to tell you, I wasn't ready for the type of reaction I got to the essay I wrote a few weeks ago.

I thought I was doing the silver investor market a favor by trying to offer a "non-silver bull" perspective. With all the hype being touted by all the silver bull analysts on the Internet to convince people of the inevitability of "$50 silver"- I thought I could make my intellectual contribution to the debate simply by playing the devil's advocate.

What came by way of a response was not even shocking- it was downright scary. I am not sure I want to be part of an investor class that thinks the way many of the silver bulls do- at least the more than 50 that emailed me their views. Many of these messages contained foul language- not of the worst type I've ever heard in my life- but plenty of "idiot, creep, jackass, fool," type. Some told me I must be "working for the other side" for writing an essay that, according to them, "the covert purpose was to get people away from investing in silver". Oh sure- there were a few emails that said "you are wrong- but you have a right to say it" or "yeah, but you forgot that this, this and this will bring silver to $50". Seven people told me outright I had no right to even write an essay on the subject- as that privilege was the sole domain of the Silver Bull Gurus (SBGs) of which everyone knows their name so I need not repeat them.

The level of arrogance coupled with a healthy dose of genuine hatred towards anyone that would dare suggest that silver would not hit $50- was a lesson in "silver bull sociology". Silver bulls- whether they realize it or not- have become an angry mob of self-righteous, arrogant knuckleheads who have tossed rational logic out the door in favor of their cherished dream of "silver at $50". This mob worships the very ground that the SBGs walk on. If someone dare question the "silver at $50" holy cow- it is as if they are killing their Lord. In my opinion- these SBGs are one notch away from being certified as a legitimate cult.

It scared me and then saddened me to think that these are the ambassadors of "buy silver because it is a good place to invest" that exist on the Internet. I put a sizeable amount of my net worth in silver because I believe it is an honest, respectable- and solid investment sector. I don't want this hype that surrounds the investment sector and thus I think a good dose of intellectual stimulation is required in the debate on the Net over where the price of silver will eventually go. If for nothing else so that these SBGs have some healthy competition over what people are being offered in the way of analyses of future market trends.

There is no other investment sector that has as few analysts- than the silver market. There are about twenty analysts who write about gold. With silver- it is the same small group of SBGs- and they don't have the whole story. The reason why my essay elicited such a vile reaction is that I presented a version of reality that hasn't been considered because the SBGs won't dare question the "$50 silver" story in their Internet postings and lectures at precious metals investment conferences. While I am sure they are all good, decent, hard working people- what the SBGs have done is damage the future respectability of the silver investment market (without intention, I am sure) by shoving this, "you'll see, the day will come when there will be no silver- and it will go to $50 and even higher" drivel to the public who gets most if not all of their info on silver markets from Internet websites.

What is interesting is that nobody ever asks serious questions to the SBGs, such as: When exactly will silver hit that magic $50 figure? Why will the conditions of this bull market be exactly like those which existed more than 20 years ago? When "silver at $50" days come- how long will silver remain at that high price? Will all the people who bought the metal solely to sell it when it reaches this level- be able to cash in their chips? I have never seen any SBGs reveal how long silver will remain at $50 during the last time this great event took place. Or any of them pontificate on what will happen the day after silver hits $50.

Who will buy silver at $50 when it was selling for $5-7 just weeks previous? What industrialist will not start looking for replacement of silver as an industrial input when it sells for $50 for more than a few months? Other than in the late 70s- when has silver ever reached such levels as the SBGs are predicting?

Attention all your Silver Bull Gurus- please, stop with the hype already. The silver market has enough strong fundamentals on its own as an industrial, precious metal- to do well just from that. Why does this segment of the investment market have to be surrounded with so much hype and doomsday prognosis? How does that help the silver investment market grow and prosper? How are you going to build a respectable investment market for silver unless silver is promoted in a rational, non-erratic manner?

Predicting 1000% gains in short periods of time is not respectable and doesn't sound like a realistic goal for most people. Hyping the gains that can be made by investing in silver is detrimental to the long term interests of the market and all those who are investors in silver today. No institutional investor will invest in the silver market as long as this is how it is being presented. No investor seriously expects such huge upside. When the SBGs proclaim in their essays and public lectures that "silver at $50" is guaranteed to happen- they bring an aura of incredibility unto the entire silver investment sector.

There is another problem- the moral problem- with telling people "hold your metal close to your chest- and then when price skyrockets- sell it and make the most amount of money you possibly can". While there is nothing wrong with making money- in my religion- making that man's endeavor in life and the sole purpose of our pursuits- is simply not moral or ethical. We were put on this earth to do more things than just rub our hands together and dream of how much money we are going to eventually have. The Creator in His Infinite Wisdom didn't create this world so that we could sit around all day and dream of how rich we will all be and how .much wealth we obtain in the shortest period of time. I find it appalling and immoral to directly correlate the gains made from silver to massive economic dislodgement and world economic instability that will bring about "$50 silver". If silver investors ever do see gains of 1000%- it will be in a time of huge misery and despair for all those that won't be holding silver as the prediction is for economic systems to collapse before silver can step in as the knight and shiny armor and serve as the new basis for currency and stability.

Silver is a good investment because it has solid fundamentals- based on a real thing- and is nobody else's debt. Is that not reason enough to promote the metal? Why do the self-declared "ambassadors" for investing in silver have to promote silver investment as being about "making a killing"? Why isn't 10-20% return- in real terms- not good enough? Why must someone make the decision to invest in silver because there are going to be "pots of gold just over the rainbow when silver hits $50"? This isn't a professional way to promote the future of the silver investment sector.

Why do we need to scare the potential investor about "drastic shortages" and "massive economic hardships" that is required before silver at $50 becomes a reality?

The Theological reason to invest in gold and silver

I like owning silver because it is solid- honest- and at least lately- fairly rewarding. I am happy getting a 10-20% annual return on my investment. That is what alternative investors expect when they invest in private equity or hedge funds. This level of return is excellent considering there are no other costs such as with mutual funds or most "managed investment products". If silver or gold can earn, clean, a 15-20%return on capital- per year- for three years- or more- I would consider this to be a fantastic investment opportunity considering the downside risk of silver going down in price.

So the reason to invest in silver shouldn't be to make huge fortunes- it should be because it offers itself as a solid investment option. In addition- let us all not forget why most of us probably first started to invest in the silver market in the first place: because unlike currencies- we wanted to put our money into an honest, stable, and debt-free environment.

We silver owners don't own banks or newspapers- or place powerful people like Senators and President in positions of power. We buy gold and silver because we want to stick our middle finger up at the Fed and all those in the power structure that make the fiat currency system possible. For us- it is a political issue- sure- but we derive our political astuteness from biblical scripture which warns us against unjust measurements- such as fiat currency:

"Do no wrong in judgment in measures of length, of weight, and of volume." (Leviticus 19:35-36)

I invested in this market for ethical reasons as well as because it offers solid future returns. What bothers me all this talk of "hitting riches never imagined before" that the SBGs preach. That is not the way to promote silver as a legitimate investment option to institutional and private investors. What we are getting today over the Net via the SBGs is the idea that silver is like going to Las Vegas and making a fortune by beating the house. The only problem is that the SBGs are guaranteeing potential investors that their return- "massive fortunes"- are bound to happen. What if it doesn't turn out that way?

Many silver bulls have lost all sense of proportion as to why they are invested in silver in the first place- which is that we all believe in the solid foundation of the investment commodity. Silver is as good as gold when it comes to this reason for investing in it.

I personally don't want to be part of any investment community that believes the ultimate goal is simply to make a huge killing by selling the silver that one person owns to another person- which in all likelihood- means that some poor sucker who bought it at that price is going to see a huge loss. This moral issue never seems to bother anyone in the silver bull world- even though most of the people who invest in silver probably have a higher, overall, level of moral and ethics- than the general population. If you are like me- you want to invest in an honest area like silver- and gold- because you believe in the need to return the world's trade and currencies to being based on these two precious metals. We invest in silver because we believe we are doing the right thing by rejecting the fiat currencies that are presented and that which we know our false and are bound to fail. This isn't propaganda or wild-eyed fantasies. It is the God given truth that we know it when we recognize it because we were created in the Creator's image and this is how the Creator viewed the issue of honest weights and measurements- which fiat money is and which silver and gold most certainly are.

I want to be an investor in silver because as a precious metal it has great fundamentals - and because along with gold- it is the most ethical investment option. I don't need hype and promises of 1000% gains. 10-20% annual returns- in real terms- are just fine with me.

My goal is to bring more respectability to the silver market- and to stimulate the debate on how best to do that. This time, please, only civil comments.

Most silver is produced as a byproduct of copper, gold, lead and zinc refining.