Tuesday, December 21, 2010

Check your conscience at the door.

There is a reason military defection and suicides are at an all-time high. No, it is not tour durations, although it doesn't help anyone's morale to be redeployed over and over to a foreign wasteland.

The reason is far more basic. Our soldiers are not being entirely successful in turning their consciences over to their sergeants. Just like in Vietnam, thousands of innocent lives are being disrupted and ended in a war whose beginnings were contrived in a web of lies by madmen like Cheney and Rumsfeld.

Men of good conscience have questions.

Once a soldier sees in an upfront and personal way the damage and destruction of war some soul searching is inevitable. If a soldier ends up personally responsible for the deaths of women, children, and other noncombatant casualties, what residue of conscience that remains intact and wasn't completely replaced with the "just following orders" mindset begins like acid to erode and corrode the soul. Vitally important questions like “why are we really here and doing this?” slip around the official blarney smokescreen and into your consciousness. Seeing the fear and helplessness in the eyes of rural peasants, whose lives are being turned upside down and ended for reasons which can't make sense to any sane person, works in the soul like leukemia in blood.

And it should. The taking of someone's life is as personal as it gets in life. If you are not absolutely truly positively beyond a shadow of a doubt certain that ending someone's existence is necessary, you should not do it; possibly not even then. You can not in clear conscience, years later as you replay the scene over and over in your mind, ease your sense of guilt by telling yourself, "I was just following orders."

When you face your maker, I can guarantee you your sergeant will not be standing by to take your rap for you.

Monday, December 13, 2010

Doing the limbo with the precious metals ratio

Historically speaking the price of gold has had a 30X1 price relationship with silver. Now it is currently trading for about 46X as much but recently was trading much higher However, the ratio has been plummeting, so how low can the gold to silver ratio go?

Could it ever return to its historical average of 30:1?

If so, we'd have to see one of the following occur:

* Gold would need to plummet to less than $1000/oz., with silver remaining stable at around $30.00/oz.
* Or, silver would need to gain another 50% to over $45.00/oz., while gold holds
steady at $1400.00/oz.
* In perhaps the most likely scenario, gold would need to see some retrenchment
combined with continued strength in silver.

The idea of gold plummeting back below $1000 without affecting silver or silver doubling to $45 with gold holding steady is pretty unlikely. However, there is some support for the possibility we might see silver prices decoupling from gold's coattails. Back when gold broke the $1,000 mark for the first time, in March 2008, silver was trading about $20/oz, or 50X1.

Today's disparity in price could indicate silver may be undervalued at the moment by historical standards.

In addition, silver's fundamentals are improving. With around 50 percent of silver demand coming from industrial applications such as batteries, electrical switches and other components, analysts have predicted that as the economy recovers so will demand, thus pushing silver prices even higher.

The biggest trick of all, if you play the spread, is to avoid trading a quarter for two dimes! The best and safest way to play is with Hecla Mining, ticker HL. If precious metals stay at these levels this company's profits will explode!