this weekend john williams from shadowstats.com is featured in the second hour of the broadcast at www.financialsense.com.

he said that the real consumer price index is more than 11%, and the m3 money supply figure for march showed it increasing at the highest rate ever, 17.4% per year.

i think a fiat money system could actually work as long as real interest rates are positive. if the inflation rate was 2%, and treasuries yielded 5%, no one would want to own gold or silver. but when inflation is running at 11%, while bonds yield less than 4%, and money market funds are paying less than 1%, it stands to reason that people would invest in precious metals. when short-term interest rates are negative-10% people need to find a reliable store of value for their savings. clearly real estate is no longer the answer, so that leaves tangible assets, and i believe gold and silver are the most appropriate now.

while bullion itself is safest of all, mining stocks are very attractively priced right now, and sso is among the safest of all the silver stocks due to its size and geographical diversification.