Friday, December 02, 2005


A Silver Standard For Latin America?

This GATA reports on a proposal in Latin America shows more government interest in precious metals. "The proposal to monetize a standard 1-ounce pure silver coin by means of a quote issued by each national central bank in terms of each country’s currency and with similar seigniorage has crossed Mexico's border and has been well received by Latin American legislators."

"Congressmen from Mexico's three main political parties explained the benefits of this citizen proposal, which supersedes political differences and is being considered by Mexico's lower house of Congress, the Deputies Chamber, and proposed the adoption of the silver ounce as a common currency for Latin America."

"'The silver coin is the adhesive, the glue, that we require for a strong, regional monetary unification,' Mexican Congressman Fernando Guzmán said in his speech."

"Guzmán, from the PAN party, and his fellow Mexican congressmen, Benito Chávez of the PRI party and Rafael Candelas of the PRD party, showed their colleagues from 22 countries how the Mexican proposal could provide a basis for a model of regional integration."

"The Mexican legislators stressed the silver coin's great attraction for popular savings and the insurance the coin would give ordinary families against currency devaluation in monetary crisis, which have been common in Latin America."

"Jorge Possi, an Uruguayan congressman, commented: 'This is a good way for the majority classes. If this works it could protect people from the cycles of the economy, from devaluations, and other problems that Mexico and other countries have had.'"

"Armin Diez, an Uruguayan congressman, pointed out the benefits of 'stability, the backing that the national economy itself will have,' adding, 'I think it is most interesting. It is an alternative that each country may choose to copy.'"

Any 'unification' of Latin America is a pipedream, but it would certainly benefit all these countries to make such a move independently. It isn't a surprise Mexico is pushing silver as they have a bunch of it in the ground.
This is a coin with a real value and not a symbolic value, which is important.”

If this does occur and I hope it does, it could and would have a large impact on the price of silver. It is way under valued IMO...
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