SGM Metals: US Silver Production Drops 30% in 2011!

Jan. 4, 2012 - PRLog -- [NEW YORK (Commodity Online): US Silver production declined to 81.4 thousand kilograms in October, a decrease of 30% as compared to October 2010. On a monthly basis, production declined 7% compared to September 2011, The Institute U.S. Geological Survey (USGS) said in a briefing.

According to Silver Institute, USA is the seventh largest silver producer in the world. The country produced 38.6 million ounces of silver in 2010. The largest U.S. silver mine, located in Alaska, is also the eighth largest silver mine in the world. The mine represents 17% of the Silver from the U.S. and also produces Zinc and lead. In 2011, total US production during January-October was at 923 thousand kilograms.]

With silver starting the year up $1.50 as it gets out the gates first, USGS data shows a 30% reduction in US silver production. This can only lead to higher prices as the industrial demand for silver continues to rise as the ‘green economy’ continues to grow with demand for water purification and solar energy generation blossoms. While the industrial demand puts pressure on the supply side of the silver market so too will the investment demand as a large portion of the 7 billion inhabitants of the planet seek out an alternative form of wealth preservation as the faith in the FED’s fiat/paper money system comes into question.

The interesting part of this dynamic is the fact that since the transition to the precious metals market has been portrayed as illogical to the average investor by the Wall Street machine, it will ultimately result in a panic induced mass exodus out of paper derivatives that are controlled by Wall Street and into gold and silver. Wealth is never destroyed only transferred. When this exodus takes place it will prove to be, in my opinion, the greatest wealth transfer in history as the investment dollars flee the paper investment derivatives that are saturated in counter party risk for the ‘flight to quality’ assets such as gold & silver, which by definition have no counter party risk.

The world doesn’t seem to be properly digesting what the dismantling of the Euro could actually mean to the stability of the global financial system nor the shockwaves that could ultimately result from such a development. The consequences of such an event can range from the basic several thousand point drop in the local stock exchange of the ejected European nation to the initiation of a global bank run and quite a few variations in the middle to include an extended depression. This would be a completely fluid situation that can and probably will morph into a myriad of possible outcomes, none of them good for the stability of your retirement plans. For those who are willing to admit to themselves the dire nature of the inflationary tight rope the money masters are walking on, moving into precious metals seems like an obvious solution to counter the exposure to the threat of sovereign default and dismantling of financial unions. For those who have yet to make the connection, the question becomes when will they wake up and what will the event be that permits their mind to envision the danger that is threatening the stability of the global markets? Will you be lying in wait in the precious metals as the herd comes stampeding in to the metals? Will this panicked herd make your investment in the gold & silver multiply? Or will you watch your nest egg fall to the ground and break?

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SGM Metals strives to offer not only wealth preservation precious metals investments to offset weakness in the economy, but to help educate our family of clients to better identify the threats to their financial security.