Investors in gold and silver are a fickle lot. They buy silver because it is cheaper then go back to gold because silver is too volatile.

May 16, 2011 – Investors in gold and silver are a fickle lot. They buy silver because it is cheaper then go back to gold because silver is too volatile. They sell off both gold and silver when it looks like inflation fears are not materializing. Then suddenly they reverse course again and start buying, but only when the price is on the rise. There is plenty of motion in the market these days, but very little action.

Mainstream media has convinced the public that gold and silver investment makes sense only in a very narrow set of circumstances – as a hedge against inflation and as a store of wealth in economic decline. Even though only the most myopic can fail to see that those are the exact conditions today, there is something else we all need to consider – the all or nothing scenario.

The possibility of hyperinflation is something we absolutely must consider for our individual well being, but we Americans have no frame of reference by which we can weigh its repercussions. And the status quo does everything in its power to convince us it cannot happen here, labeling those who try to warn us as paranoid extremists.

That, however, is slowly beginning to change as more and more traditionally conservative pundits are raising the specter of society degenerating under a rapidly declining currency. Human beings are civilized only to the point that survival is not threatened. Once hyperinflation sets in an ugly change takes place as competition for scarce necessities heats up. Power flows to those who control the most vital resources and the rule of law disintegrates. Psychologists call it “societal regression.”

For a while people can get what they need by bartering their possessions but the value of such things rapidly declines as the resource holders accumulate everything they could want. No longer able to trade for their basic needs, people must either take them by force or perish. Unless, of, course, they possess some form of universally accepted and valued currency.

Even a slim chance of that scenario occurring demands taking a proactive stand. No quantity of stock certificates, IOUs, or greenbacks will be of any use. Hoarding canned goods, guns, and ammo would only delay the inevitable. But a substantial reserve of gold and silver coins would carry you through.

It could well turn out to be all or nothing, and in that case the return on gold and silver investments cannot be matched.

Shannon King

Senior Staff Writer –

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