Some of my friends who have their silver at the Perth Mint have told me that the Andrew Maguire story has them worried about whether there's any real metal there or whether it's paper silver.

Quite honestly I don't know what to tell them. Personally I like to hold it myself in physical form. A few commentators out there say that when the default comes and Comex goes bust, all promises to deliver gold and silver will be broken and trust will be impossible to find.

That's quite a scary prospect. Other people think that the precious metals defaults will be what trigger the dollar collapse and hyperinflation. That would be a very difficult environment to survive in if you don't have a good amount of physical gold and silver handy.

In other countries like Zimbabwe or Argentina, when the hyperinflation sets in, there's a process called dollarization of the economy which sets in, where US dollars replace the local currency which people lose faith in. With the US dollar itself, there's no such option. Instead you'd have a gold-and-silverization, with silver being something like a de-facto currency for day-to-day purchases like food and gold for big rare purchases lke land.

The thing is that a huge fraction of transactions today are done over the internet. That's hard to do with gold and silver because they're physical instead of the purely notional Federal Reserve Notes which are just accounting units. I know a few folks who are working on a system to bring physical gold and silver online so that you can spend your silver and gold coins over the internet. It's a step beyond the Goldmoney and e-gold ideas because those systems have their gold in a vault in London and you have to trust them that the gold exists. You can't get the gold or spend gold you already have. The new system also is decentralized which I think will be a big thing in the future when the need to have wealth in a robust form is upon us.

Andrew Maguire might be pushing these things to a head. The prices of silver and gold have been marching merrily upwards since his announcement, but from what he says, the price smackdowns will continue until enough people start asking for delivery. Thing is, you have to have a huge amount of gold before you can take delivery from most of the ETFs and so on. Certainly more than I have or am ever likely to have.

Star and flag because this is important.

This happens more than people know.

Snip from last nights Le Met:

"I am not at liberty in any way to go into further detail but I can say there are growing developments behind the scenes which are going to send the prices of gold and silver sharply higher … and they relate directly to what GATA has been saying for 11+ years!!!" - Bill Murphy

I'm hearing unconfirmed rumblings that charges are being drawn in the DOJ criminal investigation of JPM, and after 11+ years of being tin-foiled by the mainstream mouthketeers, Midas has to bite his tongue.

Gold/Silver bottomed and began the current upleg the day of the CFTC hearing on metals manipulation.

Coincidence ?