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Metal Market Report September 2018 - Week 3 Edition

September 2018 - Week 3

Why We Stand for the Flag and the Anthem

After marking the anniversary of 9-11 last week, this week marks another meaningful date in American history. September 17 was U.S. Citizenship Day as well as Constitution Day. Under either name, it marks the date in 1787 when the U.S. Constitution was signed by 38 of the 41 delegates at the Constitutional Convention in Philadelphia and the date in 1796 when President George Washington’s Farewell Address was read before Congress. Alas, it was also America’s bloodiest single battle date, at Antietam in 1862.  Another date to celebrate is September 14, 1814, when Francis Scott Key penned the immortal words to our future National Anthem in Baltimore Harbor. Fort McHenry’s commander, Major George Armistead, had ordered the largest battle flag ever flown at the time – “a flag so large that the British would have no difficulty seeing it from a distance.” How large? The flag originally measured 30 by 42 feet. The flag had 15 horizontal red and white stripes and 15 white stars in a blue field, representing the 13 original colonies, plus Vermont and Kentucky. Each of the 15 stripes is two feet wide and each of the stars measured about two feet in diameter. As flag scholars know, White signifies purity and innocence, Red denotes hardiness and valor, and Blue signifies vigilance, perseverance and justice. This large, historic flag was sewn by Mary Young Pickersgill, with the help of her daughter, two nieces and an African-American servant.

British ships bombarded the Fort for 25 straight hours under heavy rain. When the British ships failed to pass the Fort, they retreated. On the morning of September 14, when the battered US flag still flew above the ramparts and Fort McHenry clearly remained in American hands, Key, a lawyer and poet held by the British on a truce ship, saw the Garrison Flag still flying, so he wrote the poem he first titled "Defense of Fort McHenry,” describing what he saw from the ship’s hold. But whatever happened to that huge flag?  The flag that flew over Fort McHenry stayed in the possession of the Armistead family for nearly a century until 1907, when his grandson loaned it to the Smithsonian Institution. In 1912, it was made a formal gift. Today it is permanently housed in the National Museum of American History at the Smithsonian Institute in Washington, DC. A restoration project began in 1999, completed in 2008. The flag is now set in a two-story display at a slight angle and in dim light to preserve its colors.  I got to see it up close when my daughter did an internship at the Smithsonian Institution a few years ago.

One of the most popular items we offer is our “We Stand for the Flag” Challenge Coin: Honoring Those Who Protect our Freedom. It’s a popular gift item, available for as low as $9 per coin to hand out to friends and family as a reminder of flag etiquette and the debt we owe our great defenders of freedom.  Call us to order or buy online!

There is a national law regarding standing for the Anthem, but is more of a tradition than enforceable law:

Title 36 United States Code: “Conduct During Playing… a rendition of the national anthem”

(1) When the flag is displayed —

(A) all present except those in uniform should stand at attention facing the flag with the right hand over the heart;

(B) men not in uniform should remove their headdress with their right hand and hold the headdress at the left shoulder, the hand being over the heart; and

(C) individuals in uniform should give the military salute at the first note of the anthem and maintain that position until the last note.

(2) When the flag is not displayed –

All present should face toward the music and act in the same manner they would if the flag were displayed.

Standing for the flag has been an important protocol for me since the 1960s. We stood for the flag at banquets, at the start of school, at church events, legal events (my Catholic father was a District Attorney and World War II veteran), sports events and band functions (I was in the band). From childhood on, I always understood that we must all stand and remove any headdress. We knew, and were taught, that this is the land of free because of the brave, who kept us free.


Bitcoin is Sinking, While Many Other Cryptocurrencies are in “Free Fall”

Bitcoin fell from $6,500 on Monday morning to $6,262 at noon and $6,350 Tuesday.  Bitcoin peaked at $19,783 last December 17, the week it first traded on a recognized futures exchange, because (for the first time) traders could “short” the speculative cryptocurrency, just like they could always short gold bullion. 

While bitcoin is down 68% in the last nine months, many of the other cryptocurrencies are down over 80%. The next two largest cryptocurrencies traded in US markets are Ethereum (ETH-USD), which is down over 85% since January, and the aptly named Ripple (XRP-USD), down 91% since January.

Just like the “” bubble in 2000, these cryptocurrencies have no “earnings” or hard-money backing to give them real value. They trade merely on the fact that they rose rapidly in price during most of 2017, so investors poured into bitcoin hoping for future profits. Instead, they grabbed the proverbial “burning match” just as it reached the part where it burned the fingers of the next buyer.  In this light, gold’s tiny price decline of 7% this year is trivial – reflecting merely the rise in the US Dollar Index, year-to-date. 

Last June, bitcoins first dipped below $6,000 when the Wall Street Journal and Washington Post reported on the widespread hacking of bitcoin accounts, especially in Asia, where regulations are lax.  Bitcoin prices briefly recovered but have remained below $6,500 since early September, down 68% from its peak.

One of the most bizarre aspects of bitcoin mania we’ve seen recently is the proliferation of bitcoin ATM machines, some here in Texas. We’ve heard about businesses being approached here in Beaumont to have bitcoin dispensers in their place of business.  They are like ATMs, but they are called BTMs, dispensing fractional bitcoins.  There are so many “red flags” here that I hardly know where to begin. First, several IDs are required to access the machine. You don’t get the bitcoins at the machine, but they are sent to an address. Secondly, BTMs are far more expensive than online transactions or regular ATMs affiliated with a bank. Typical fees to cover these costs are 5%. (Imagine taking $300 out of your ATM and only getting $285!) The same 5% fee is assessed when you submit bitcoins back into the BTM to credit your account. The biggest problem, of course, is that the value of the bitcoins is declining over time, so the proprietor of the BTM could be blamed for dispensing worthless currencies with high fees!

Gold is the real thing. Stick with the 5,000-year track record of gold, not the 10-year fad of computer-generated artificially-mined bitcoin accounts, subject to lost value, fraud, hacking and high fees.


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