ONZA LIBERTAD receives green light from the Mexican Congress.
Today, Thursday October 27/05, the Mexican Senate has approved the law draft that institutes the one ounce silver coin, ‘Onza Libertad’ (‘Liberty Ounce’), as legal tender. The law draft will now be sent for discussion and ulterior approval to the House of Representatives.
What this new law means is, that if I want to sell one of my Libertad silver ounces now, I will have to go to a coin dealer and he will offer me $85 pesos for my coin, which is the price dealers are paying right now, when they buy the Libertad coin, back from their clients. Those dealers are presently selling the Libertad for $110 pesos. The spread is roughly 30%.
If the law were to be implemented tomorrow:
1- The same coin dealer will have to pay me $110 pesos if he wants me, to sell him my coin.
2- I can go to a supermarket or a gas station or any store and by law they will have to take my coin as payment for $110 pesos, which is its present price.
3- In any event, the coin price cannot go below $100 pesos by law decree, no matter if the spot silver price may be under $100 pesos in equivalent US dollars. The price of the coin may go over $100 pesos as the price of silver appreciates, but it can never go down below $100 pesos.
The heart and soul behind this great effort is no other than Hugo Salinas Price. If the law is approved and there is a big chance it will finally, we Mexicans will have gained substantial freedom thanks to the vision and leadership of Hugo Salinas Price and no doubt, also thanks to the GATA efforts, that all this time have been, although indirectly, behind such big endeavor.
The central Bank of Mexico has adamantly opposed the law initiative, because ever since it was declared by law ‘Autonomous’, it was handed in a silver tray to the Federal Reserve, from which _off the record_ the Bank of Mexico receives instructions. Suffice it to say that over 99% of the Bank of Mexico reserves are US dollars and only 0.20 % is gold. The peso is a derivative of a derivative and the country is but the backyard of the Empire.
You can bet that many nations will follow suit behind Mexico and among the first jumping on board the silver train, will be several Latin American nations, among which Brazil may be one of the first.
