I just came back from seeing Rian Johnson’s latest movie “Looper” starring Joseph Gordon-Levitt, Bruce Willis, Emily Blunt, and our favorite metal of all time, Argentum-47 — silver in a supporting role. That’s right — silver plays a minor, but very critical role in this flick. But before I go on, please let me warn you that although I won’t be blurting out spoilers, I will be describing some of the scenes. Therefore, if you wish to have a completely unspoiled viewing experience, please watch the movie and then come back here.

From IMDB, “In 2072, when the mob wants to get rid of someone, the target is sent 30 years into the past, where a hired gun awaits. Someone like Joe, who one day learns the mob wants to ‘close the loop’ by transporting back Joe’s future self”. Obviously, this is a science-fiction action movie, although it has great underlying meaning and a little less action that I expected. There are long conversation and character development scenes devoid of gunfire and explosions, so once in a while it felt a little like I was watching a director’s cut.

But I digress … First, let me start by asking you to guess how these “hired guns” got paid by his bosses from the future? In silver!  I believe they used 50 oz. bars with unique QR code-like engraving.  This is the main reason for silver being in the movie — as a form of payment for services rendered. You may not think this is anything, but I believe the symbolism of this directorial choice is huge. There’s only one time you see paper currency in the movie — in a montage of the main character’s life in China. He is shown blowing through an entire box full of futuristic renminbis. I’m sure the director wasn’t going for any kind of symbolism here, but, of course, I see it everywhere, including this scene — while the hard store of wealth is locked in a vault to represent the lasting riches, paper is being spent left and right.

I also spotted a fun sub-point related to China. There’s a scene in which the protagonists discuss their next move. One of them wants to go to France. The other one insists on going to Beijing. The director spent extra time on this scene to make sure the point was driven home — in the next 30 years you want to be in China. Not Europe. China. Of course, this is what Jim Rogers, Jim Sinclair, and Peter Schiff have been talking about for years, warning everyone that in the 1800s you’d want to be in London, in the 1900s — in New York, and in 2000s — you want to be in Singapore.

Second, silver is used like money in scenes where characters exchange silver for other goods. There are scenes in which the characters plop down bars of silver in exchange for entertainment or ammunition. I was blown away by the fact that even though the action is set in the near-future, there’s no sign of paper money, electronic money, scanning of tattoo money, swiping of ‘credit chips’, etc. Just boom! silver goes on the table, goods come off the table.

Interestingly enough, silver bars are being mentioned as a store of wealth as well. Many times throughout the movie, the protagonist’s stash is used as a bargaining chip between friends, enemies, employees, and bosses. You can hear lines like, “Do X for half of my silver”, and “Take all of my silver stash”. The final scene shows silver bars being scattered across a rural road with the love interest standing over it, and the plot is assuming secure future for the characters because of their newfound wealth.

Here’s how the Austin Chronicle addresses this very point:

It made sense then to make the world feel as desperate as possible, and make you realize that, if he loses that silver, he’s in a very bad place.

Third, gold is there, too. I won’t tell you exactly how it’s used, but I can say that it’s also a form of payment. Of course, Hollywood did its usual screw-up when portraying someone handling large quantities of gold. In the movie, you can see the henchmen waving a bank of gold bars like it’s papier mache, when in reality if would be much heavier and harder to handle.

Fourth, there’s even a lesson in how NOT to store silver! The main character has a pretty obvious vault safe in the floorboards under the rug with a 5-digit combo lock. The inside of the vault is lined with silver bars, hundreds of them. Hey, at least he didn’t keep it in a bank, an offshore storage facility, or an ETF! The moral here is clear — if he simply separated his stash, he’d be able to access portions of it while he was on the run. Instead, the bad guys walked through the doors, went straight for the safe, and unloaded it. Interestingly, in this scene the director mentioned ‘several trips’ that henchmen would need to take in order to grab all 400+ bars of silver.

Fifth, the future is apparently full of guys who lost faith in fiat currency, but also somehow discovered another Comstock Lode — the amount of silver waved around in the movie is pretty amazing. If the main character sat on almost 500 bars after saving half, this means be banked around 1,000 fifty ounce bars of silver for a combined total of 50,000 oz, or $1.7M in today’s dollars. If every ‘looper’ (hired assassin) was being paid in 50 oz silver bars, that would actually put a small dent into today’s physical markets.

And finally, the most important point I carried out of the movie theater is that silver is entering our collective consciousness. Little by little, like raindrops forming into a flood, silver is increasingly being used as money in popular culture, this movie being the latest example. Since deep down we’re still using our reptilian brains that are susceptible to fight-or-flight responses and repetition, I feel like if the pop culture keeps hammering the point that silver is money, it will soon reach its critical mass and Joe Sixpack will one day want to buy your used car with silver because he saw it in a movie and his friend did the same.

So big props to the director Rian Johnson and the cast of “Looper” — everyone did an amazing job, and this silver bug is very happy. Go see it!

Found this topic in the “Explain It Like I’m Five” subreddit — Why can the USA sustain such a large national debt?

Of course, I had to click.

What I found is an unusual and unexpected mixture of Keynesians screaming that debts don’t matter, deficits don’t matter, and the US can continue on her current path forever.

However, there was a bright spot, too. The top comment with over 100 upvotes was a few paragraphs written by redditor watabit:

It’s pretty simple – people trust that the USA will pay them back. If people trust you’ll pay them back, you can borrow basically anything you want. In a small way, this is reflected by your own personal borrowing – the higher your credit score, the more people will let you borrow and at lower interest rates. You can think of it like the US Government has a credit score of infinity. It is considered pretty much the safest place to lend. You can see evidence of this back when S&P lowered the “rating” of the US debt (lowered its credit score, basically). People worldwide were scared, but that same day they loaned even MORE money to the US, simply because no matter what S&P said, it was still the safest place to put cash.

Now, yes, this means that the US has to exercise good stewardship of the money, and responsibly pay it back. Because people will stop trusting it, if it doesn’t pay, and then it won’t be able to borrow as much. The reality of the situation is that the US could, if it wanted, inflate its currency and thus reduce the amount it has to pay back. So it’s very unlikely to go entirely bankrupt. But if it pulls this little trick, people will lose trust and the same effect will happen.

It’s not going to last forever. Countries like China are already pushing for an “international reserve currency” that’s not dollars, so they don’t have to trust the US. We’ll see what happens.

Note some interesting thoughts that I actually agree with. The only thing propping up the current way of life in the States is the fact that people all over the world trust that we will pay them back. He also acknowledges that other countries are starting to put together their own versions of reserve currencies, which means that information is pretty much mainstream now and out of the realm of conspiracy theories.

And then there’s these types of comments:

This stings a little, but it’s kind of true. There are many precious metals investors out there who would love nothing more than to fight off the zombie invasion and tear into those MRI’s they’ve been stashing since 1998.

When I said that it’s just a matter of time when the dollar is worthless because it’s impossible to maintain trust and deficits forever, I got this as a response:

These kids were posing a lot of questions I didn’t have time to answer, but I directed them to a great starter movie called I.O.U.S.A. At the end of the day it’s really great to see these kinds of conversations stirring on the Internet’s front page. Also, it’s a small relief to know that the overwhelming majority of people are still completely clueless about real assets, and even though we have a hard road ahead of us to educate them, there’s still time to keep on stacking.

If you own a small business or start-up, you may be unsure of what types of insurance, if any, you need to take out because you may not be aware of the risks involved in your line of work unless and until something untoward happens.

Public liability insurance is one of the main types of insurance available to businesses of all sizes and it is designed to pay out legal fees and compensation if a business is sued for negligently causing someone personal injury, death or damage to their property.  For example, it would cover the costs involved in a claim by a member of the public whose house was damaged by negligent builders; or a claim by a person who slipped on a wet shop floor; or a person whose computer software and network has been damaged by negligent IT work.  The person making the claim has to prove that the business has been negligent (perhaps by failing to ensure that its employees have followed correct health and safety regulations), but meanwhile the legal fees in defending the case will quickly build up and can ruin a small business or start-up even if no compensation is ultimately ordered.

If you have any contact with the public, either face-to-face or through selling them products, you should put public liability insurance in place in case they are injured or have their property damaged.  If you sell washing machines online, for example, and one of them turns out to be faulty and causes the purchaser’s house to burn down, you could be held liable.  Public liability insurance would pay out in those circumstances.

Some clients (particularly other businesses, or the local authority) stipulate in their contracts that if they are to hire you then you must have public liability insurance in place (they will usually specify an amount of cover, too).  For others, simply seeing that you state in your adverts that you carry public liability insurance will instil them with the confidence to hire your services on the basis that you are a responsible business and they will be covered if something goes wrong.

The cost of your public liability insurance will depend on several things including the nature of your business, its location, any previous claims and the potential value of claims that you could make.  You can usually pay monthly and the premiums are generally affordable.  You can get no-obligation quotes in minutes online, so it’s worth doing a bit of research to decide whether or not to take out a policy.

I’m witnessing three things happening in the silver camp right about now.  As the dollar-denominated price of silver is freefalling in slow motion, fellow stackers either 1) freak out and get out 2) try to call the bottom 3) pay no attention.

I’m in that last group — I pay little to no attention.  Sure, did I get hosed in the nominal terms when I bought Canadian Moose coins at $38, and they are now $30?  Yes, and I would feel bad if I cared.  But I don’t.

I feel like bitching about “losing” dollars on a silver trade is like complaining that you should have bought 50,000 rounds of 45 ACP 230 grain ammo, but instead you only bought 48,000.

As a stacker, your very nature is one of a contrarian.  You have removed yourself from the insane paradigm of ever-increasing debt by choosing to put your hands on some real things that have real value.

Here’s a quick chart I created to illustrate why I don’t care about silver price denominated in dollars.  This is my response to the collective circle-jerk that’s happening right now in the precious metals community as everyone is trying to make everyone else feel better about those $48 dragons they bought last month.

This is a 4 year time horizon hypothetical scenario of buying silver on the dips.  Start on January 1, 2009, and get a roll of Eagles at fifty bucks.  In 6 months repeat at the same price.

A year goes by, and silver drops $10 to forty bucks.  You load up.  Price stays the same – keep buying, just now as much.

Another year goes by, another 10 dollar drop.  You load up again.

After 4 years of this, silver has lost 80% of its original price and is now trading at $10.  A catastrophe, right?  Not really, if you keep buying on the dips.

In another year, because the fundamental issues ailing our world have not been fixed, silver goes back up to $40.  Instead of losing your ass, the dollar-denominated value of your stash went up by 150%.

This is the type of thing I do, and this is why I don’t worry about the dollar-denominated price of silver at this point in time.

There seem to be two distinct camps in the precious metals investment community.

There are those who stack physical gold and silver because they believe in the inevitable and, most importantly, swift demise of the US dollar and the American hegemony, impending social upheaval, sovereign defaults, and the new paradigm.  I put these investors in camp number one and call them “doomers”.

There are also those who stack physical or paper precious metals as a way to diversify their portfolio.  They don’t only own gold and silver — many have 401Ks, Roth IRAs, real estate investments, equities, and cash to name a few.  They don’t think a total financial meltdown is likely any time soon, so they continue to treat precious metals as just an asset class.  I call these folks “dealers”.

Both camps have strong selling points.

The doomers preach self-reliance, ingenuity, independent thinking, and preparedness.  They are the survival ninjas you want to hang out with if a hurricane blows through your town.  They have all four bases covered at all times — food/water, gold, weapons, and energy.  Some picked up and moved into rural areas in order to be more independent, convinced that constant beating of war drums, growing deficits, declining morals, and depreciating currency are harbingers of the economic catastrophe that’s about to hit these shores.  Some sold everything they owned, including their retirement accounts, paid huge fines, and bought gold.  Some, convinced that the US empire is falling, moved abroad.

The dealers are the folks you want to be around if nothing especially terrible happens within your lifetime.  They understand that we’re put on this Earth for 70-80 years, of which the first and the last 20 years we’re either clueless or helpless.  They know that this mere fact leaves us with 30-40 lucid, productive years, during which we make all of our most important life decisions.  They don’t dismiss the possibility of a black swan appearing and screwing up our plans, but they are not exactly planning on it to happen tomorrow, either.  They know that the precious metals markets are manipulated, but they don’t mind owning some paper — mining stocks, ETFs, Blue Chips, emerging markets, NASDAQ, etc.

Both camps have weaknesses, as well.

The doomers missed out on the amazing, truly once-in-a-lifetime spectacle that unfolded before our very eyes — the Internet.  Most recently, they missed out on head-spinning returns of the likes of Apple and SFTC.  They bought silver in 1986, and haven’t seen a dime of nominal return until 2004.  They’ve bought that Honda generator years ago, but used it only once or twice.  They might have sold their nice suburban home before the real estate bubble to buy that rural compound, and missed on that tax-free hundred grand of profit if they sold it just a few years later.

Conversely, the dealers may not be adequately prepared for that black swan.  They may not be placing enough emphasis on sovereign debts that are currently hockey-sticking, and the monetary supply that’s expanding at an ever-increasing rate.  They trust that most people running the nation are at least somewhat competent, otherwise they wouldn’t have made it far.  The dealers own and trade in too much paper, and not enough real assets.  They may have purchased that weapon to protect their castle, but never went to the range because they are afraid of being awkward around other dudes who know how to shoot and clean their pistols and rifles.

In my research, I follow both doomers and dealers.

On the doomer side, I listen to Max Keiser, Bix Weir, Chris Dwayne; less frequently, Gerald Celente, Peter Schiff.  I don’t listen to Alex Jones.  Sidebar — one time I did have my car radio on ‘scan’, and I decided to give Alex my ears.  He was very loudly flipping out about soldiers in war gear driving their tanks up and down Highway 183 in Austin, Texas, apparently ready to take over and institute martial law.  I just happened to be on 183 at that exact moment, and decided to take a little detour to check it out.  Smash cut to me talking to a couple of US Marines next to their Humvee in front of a Toys-R-Us, raising money for Toys for Tots.

I like Max Keiser for the same reason everyone like him — theatrics.  Bix is a little conspiratorial for my taste.  Chris Dwayne is very dedicated and seems to put his silver where his mouth is.  Mr. Celente’s rants can be fun, and Peter Schiff is a little repetitive.  I would never sell everything I owned to put my family’s eggs into a single silver basket like Chris did, though.  I know he’s convinced that the end is nigh, but so was Harold Camping with his predictions of the apocalypse.  I used this example before — Italy in the year 2000 still used liras in very high denominations, but the economy was booming nonetheless:

You can run out of money, but you can never run out of numbers.  Even when a cup of coffee costs your 20,000 of ANYTHING, life goes on.

However, the doomers taught me how to invest in physical metals, grow a portion of my food, use a weapon, and be more self-reliant.  They taught me that “if you don’t hold it, you don’t own it“.

The dealers, like Mike Maloney, David Morgan, Brother John, Kerry Lutz, Kyle Bass, and Jack Spirko reinforced my view that if nothing catastrophic happens, I need to be ready to catch the next big wave.  Paper is not inherently evil, and it will continue to have value unless the fabric of the society completely disintegrates.  Brother John, for example, covers not only silver in his videos and articles, but also gold, equities, commodities, events in history.  This can only be good as it rounds you out and makes you more flexible and less dogmatic.

Don’t get me wrong — this is not a Keynes vs. the Austrians debate.  I believe that all the folks I’ve mentioned are true hardcore metal investors.  The difference between them comes down to believing whether the black swan shows up in our lake soon, not very soon, or maybe we can’t know and we just have to be as prepared as we can be.

And remember: folks for both of these camps advocate doing your own research and making your own path.  They are not giving investment advice.  They are simply following their convictions, which is exactly what all of us should be doing as well, whether we agree with everything they say, some of it, or nothing at all.