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Four Scary Words: "Silver Delivery Not Possible"

Tyler Durden's picture




 

The SHTFPlan's Mac Slavo brings us the story of one Bill Cramer who decided to cash in on his silver profits after a nearly decade holding period (under the assumption he was receiving warehousing services considering he was paying storage fees), confident that he could simply receive the metal he held with a broker, until he heard the following 5 very disturbing words: "Sorry, delivery is not possible."

From SHTFPlan:

"Bill Cramer of St. Louis was pretty confident everything was on the up-and-up. He purchased 5000 ounces of silver back in 2003 for a spot price of $4.94 and stored them with an east coast broker. When he was discussing his holdings with his coin dealer, the dealer dared him to try and take delivery of the metal.

Bill took him up on that dare and contacted his broker requesting to take delivery of his supposed physical metal holdings, for which he had been paying storage fees for years. As you may have guessed, the broker advised him that physically delivering the metals was not possible."

Here is how Bill recounts his experience:

So, I took his dare, I called them up, it was June of last year. The metal I had purchased in January of ’03. I said “I’d really like to take delivery of my metal – the five thousand ounces.” They go “well, that’s not possible.” And, I go “well, I’ve been paying storage fees since January of ’03, what do you mean I can’t take delivery.”

“Well, it’s part of the account. It’s called a pool account. And, you don’t take delivery, you just participate in the appreciation.”

So I immediately sold that 5000 ounces at $18.33 and I had my cell phone in my hand and I immediately purchased 2500 silver eagles at $18.41 and that’s how I reconciled the problem of not being able to take delivery of my physical metal from a brokerage account.

In other words: anyone who has "pool account" exposure may want to reevaluate their options. And, if we may add, anyone who has Comex storage exposure in general (University of Texas wink wink) even for allegedly delivered gold, and when massive amounts of "registered" gold get mysteriously shifted to "eligible" status, may want to be reeeeally careful now that silver is about to take out its all time nominal high.

 

 

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Mon, 04/25/2011 - 12:40 | 1203870 primalplasma
primalplasma's picture

That's why it doesn't count unless you have the silver in your hands...and people will only be able to get at it if they pry it out of them, dead and cold!

Mon, 04/25/2011 - 12:47 | 1203906 Thomas
Thomas's picture

That would be excellent for small claims court (but with a very significant point to be made.)

Mon, 04/25/2011 - 12:46 | 1203918 Turd Ferguson
Turd Ferguson's picture

If you're wondering what I think, here you go:

http://tfmetalsreport.blogspot.com/2011/04/be-cautious.html

Mon, 04/25/2011 - 13:17 | 1204074 Paper CRUSHer
Paper CRUSHer's picture

Well bro,I guess you'll be stickin' around for good since that $1500 target ya made was taken out well before summer.For the few o'those still remaining(trolls),tread carefully for one of these days you too will be Turdminated.

BTW,even though its been quite a while since i last checked out 'tfms' i gotta say keep it comin'.

 

Mon, 04/25/2011 - 13:45 | 1204246 Herd Redirectio...
Herd Redirection Committee's picture

Fightin' the good fight!  Its a thankless job, but someone's got to do it!

Atleast you know one thing for sure in this fight, you are in good company!

Check out the latest from the Capital Research Institute "Cracks Starting to Show?":

http://www.capitalresearchinstitute.org

Even though the Capital Research Institute was only officially founded 3 months ago, we have already started seeing various predictions come true.  Commodities inflating rapidly?  Check.  Lingering sovereign debt crises?  Check.  Gold and silver at, or approaching, record prices?  Check.  Another conclusion from our analyses was that the US dollar will inevitably lose world reserve currency status.

Others are not as convinced.  Michael Pettis, a Finance Professor, and writer for Financial Times (ft.com) recently argued that although the US should be prepared for a lesser role for the US dollar in the world of finance, fears of its demise are overblown.  Suffice to say, here at the CRI we strongly disagree with that assessment...

Mon, 04/25/2011 - 17:26 | 1205326 Banjo
Banjo's picture

Turdminated. Love it !!

 

/begin rant

It's Over.

NWO

Barry Soetoro

Globalist bankers

WTC7 WFT??

FIAT money slavery.

Fukushima :(

Titanic is going down.

/end rant

 

Mon, 04/25/2011 - 20:27 | 1206033 Hacked Economy
Hacked Economy's picture

The Titanic's going down?

And I was just starting to have fun watching the Feds re-arranging the deck chairs...darn it all.

I'll race you to the lifeboats!  <grin>

Mon, 04/25/2011 - 20:30 | 1206035 Hacked Economy
Hacked Economy's picture

<erased accidental double-post>
<darned trigger finger!>

Mon, 04/25/2011 - 14:01 | 1204366 FLIP THAT BOND
FLIP THAT BOND's picture

I'm with yah Turd, this is a great time for a shakeout.  I'm waiting until Thursday to get back into short dated options and I see three or four weeks of clear sailing before the selloof before the end of QE2 (if the institutions are even still in control at that point).

Mon, 04/25/2011 - 14:04 | 1204367 FLIP THAT BOND
FLIP THAT BOND's picture

I'm with yah Turd, this is a great time for a shakeout.  I'm waiting until Thursday to get back into short dated options and I see three or four weeks of clear sailing before the selloof before the end of QE2 (if the institutions are even still in control at that point).

Mon, 04/25/2011 - 14:06 | 1204368 FLIP THAT BOND
FLIP THAT BOND's picture

Lowest silver to gold ration will be 5 to 1.  Start shifting into gold at 15 to 1 and finish at five to one.

Mon, 04/25/2011 - 16:11 | 1205012 AUELOX
AUELOX's picture

I finally convinced (just) one friend to buy Precious Metals.  He purchased and had them deposited in a East Coast Depository.  They do not "pool" but keep them in "segregated storage".  When the SHTF, do you think his PM's will be safe?  I keep mine near and dear.  Do you have any thoughts Turd?

Mon, 04/25/2011 - 13:29 | 1204133 weinerdog43
weinerdog43's picture

Actually, no, this is not a matter for small claims court.

Small claims can only resolve matters in terms of dollars and cents.  What you are looking for here is called "specific performance".  In other words, you don't want the greenbacks, you want your 5,000 ounces of silver.  Another example would be real estate.  You don't want the value of the property, you want the property itself.  A money judgment means nothing.

Therefore, you would have to file in District or Chancery Court to secure relief.

Mon, 04/25/2011 - 14:06 | 1204384 Chuck Walla
Chuck Walla's picture

A money judgment means nothing.  More so now than ever!

Mon, 04/25/2011 - 14:48 | 1204644 Alienated Serf
Alienated Serf's picture

you guys crack me up.  you don't think the depository has a arbitration clause in the contract? 

sheeple don't get to go to court.

Mon, 04/25/2011 - 14:55 | 1204670 SWRichmond
SWRichmond's picture

Why was the guy paying storage fees on a pool account?

Mon, 04/25/2011 - 15:03 | 1204716 Votewithabullet
Votewithabullet's picture

...red flag.

Mon, 04/25/2011 - 15:27 | 1204809 Alienated Serf
Alienated Serf's picture

Just because you own part of the pool doesn't mean the pool is stored for free.

Tue, 04/26/2011 - 01:55 | 1206767 Anonymouse
Anonymouse's picture

I agree his account agreement probably allows for pooling.  And it probably has an arbitration clause.

But I think fraud over the storage fees should allow an actual lawsuit.

I think that's the claim he should make.  I would bet that he is paying full storage costs for his silver.  The question is, are others also paying storage costs for the same bars.  If so, that would be fraudulent.  Sounds like he should file a class action suit.

Tue, 04/26/2011 - 05:22 | 1206973 TheRagingTory
TheRagingTory's picture

Although its possible that the company is acting fraudulantly, having sold the silver and still claiming the storage fees, but its entirely possible the company is completely above board.

It seems more likely that most of its clients are merely holding a 10% share of a 1000oz bar, pay 10% of the storage costs of a single bar and because no one was expected to hold several full bars, the company made no allowance for withdrawls.

Mon, 04/25/2011 - 12:47 | 1203921 cbaba
cbaba's picture

+1

YES , YES and YES

it doesn't count unless you have the silver in your hands...

Everybody must read and repeat this word, its explains everything clearly.

 

 

Mon, 04/25/2011 - 13:04 | 1204003 thames222
thames222's picture

exactly--physical holdings don't mean shit unless they're actually physical!

 

www.forecastfortomorrow.com

Mon, 04/25/2011 - 13:52 | 1204318 tiger7905
tiger7905's picture

Kingworldnews famous "London Source" says Asians will think nothing of running silver to $100/oz

http://goldandsilverlinings.com/?p=791

Mon, 04/25/2011 - 12:48 | 1203926 justbuygold
justbuygold's picture

Lately the non delivery factor is becoming an extremely common event. I am hearing this everywhere. People are not getting delivery, especially at the big banks.  Furthermore , Sprott's silver trust filed a shelf prospectus a few weeks ago in preparation for another large issue.  Why hasn't this taken place ?  The answer is he cannot find enough GOOD DELIVERY silver.  Even when he IPO'ed he had to scramble over to Europe to secure the balance of his silver and then pay ridiculously high insurance and transportaion charges.  

 

The silver shortage is REAL !  I expect you willsee Comex settling for cash as early as June.  Now Comex inventories are below 35 MM oz  the sramble to get delivery will accelerate exponentially as it becomes a race to get whats left.

Mon, 04/25/2011 - 13:05 | 1203992 Fred Hayek
Fred Hayek's picture

According to Harvey Organ's site, they settled dozens or perhaps hundreds of contracts for cash in the last silver delivery month in March.  It was very clear, the COMEX might show that there were 150 contracts fewer waiting to be settled than the day before but they'd only note silver being delivered to 120 contracts.  The other 30, by implication, had been paid off with a cash premium to not stand for physical delivery. 

Mon, 04/25/2011 - 12:52 | 1203936 bobby02
bobby02's picture

Wow! How scary! I need to run out and sell the kids to buy more silver coins.

Doesn't it bother anyone that neither the name of the broker nor any specifics of the brokerage account are mentioned? Meanwhile, this charming tale has been posted in hundreds of places on the Internet.

Now, that would make me go Hmmmm.

Mon, 04/25/2011 - 12:56 | 1203961 Harlequin001
Harlequin001's picture

Now that's being silly...

Mon, 04/25/2011 - 13:17 | 1204080 bobby02
bobby02's picture

If you want silly, read the stuff about non-delivery and cash settlement.It would be interesting to regress the number of such comments against the days left till settlement. I expect the relationship is geometrical, if not exponential.

 

Funny how after every contract expiration goes off without a hitch, all the people who predicted non-delivery/cash settlement/cats sleeping with dogs in the street disappear or "Be vewy vewy quiet."

Mon, 04/25/2011 - 13:24 | 1204116 FeralSerf
FeralSerf's picture

The non-disclosure agreements that are associated with the cash settlement premiums are very binding.

Mon, 04/25/2011 - 13:47 | 1204280 bobby02
bobby02's picture

How convenient. I suppose the agreements are signed by 12-foot martians that we can't see either.

 

Out of all these cash settlement premiums and delivery fails, no information on a single one of them has ever come to light.

 

Hmmmmmmmmmmmmmmmmmm.

Mon, 04/25/2011 - 15:05 | 1204727 Imminent Crucible
Imminent Crucible's picture

Nadler, I smell you.

Mon, 04/25/2011 - 17:15 | 1205289 FeralSerf
FeralSerf's picture

That's one of Blythe's shills you smell.  The less payoffs she needs to make, the better her (and Jamie's) bonuses will be.  It's better (for her and her employer) that all the greedy bastards here that can swing more than ten contracts believe there's nothing but heartache in trying to scam her.  Shills are cheap.  Much cheaper than silver longs.

Mon, 04/25/2011 - 17:19 | 1205269 FeralSerf
FeralSerf's picture

The penalty amounts can be in the millions.  And they are watched.  If it was me, I sure as hell wouldn't risk it.  What is there to gain?  A little publicity and your name in lights on Harvey's Daily?  Not enough for any thinking organism.

Mon, 04/25/2011 - 17:17 | 1205295 bobby02
bobby02's picture

Fine. Show us the data. I will be the first to admit I was wrong.

Mon, 04/25/2011 - 17:21 | 1205304 FeralSerf
FeralSerf's picture

What data?   Are you stupid or just dense?

Mon, 04/25/2011 - 13:21 | 1204104 Jonas Parker
Jonas Parker's picture

Morgan Stanley got caught pulling this stunt a couple of years ago and got nailed in a class-action suit. Look it up!

Mon, 04/25/2011 - 13:52 | 1204316 bobby02
bobby02's picture

Your're right - I remember. The penalty was a joke. And UBS has recently been named in a similar action.

Don't get me wrong, this story could be on the level. It's just funny that the broker/type of account/any salient details whatsoever have been omitted. You would think that journalists and conspiracy types would want that stuff in there. Thus, it has the ring of truth without any substance.

Meanwhile, if you google this story, you will get pages of hits. Look at the boner it ellicited among ZH gold bugs. Does this not seem strange to you?

 

Mon, 04/25/2011 - 13:33 | 1204182 SuperRay
SuperRay's picture

I'm an open-minded guy, bobby, and i have to consider your point.  I have "allocated silver" in a depository for my IRA, and i'm in a quandary, because if I take physical delivery, that counts as a taxable withdrawal.  Anybody know anything about Sterling Trust?

Mon, 04/25/2011 - 14:14 | 1204452 Al Gorerhythm
Al Gorerhythm's picture

Yeah, I do. They say they have your silver held in trust for you. I don't trust them with YOUR silver. Do you? Put them to the test. Demand delivery and see what their response is.

Be sitting down when you make the call. Just in case.

Mon, 04/25/2011 - 17:38 | 1205374 FeralSerf
FeralSerf's picture

If your IRA invests its money in the shares of a Sub. S corp or LLC that owns the physical PM, you could be the person that manages the storage of it.  There are companies that enable this sort of thing, I hear.  I don't know how the IRS feels about it.

Disclosure: DYODD!!!  I know nothing.

Mon, 04/25/2011 - 14:37 | 1204587 eisley79
eisley79's picture

http://www.cnbc.com/id/42610684

yes, strange how if you click through on the sources, it leads no where...

 

what's it like being a FAAAAAHCKING NOOB?

 

hmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmm?

Mon, 04/25/2011 - 15:11 | 1204750 Imminent Crucible
Imminent Crucible's picture

But, but, but....how do we know that this Jane Wells is a real person?  How do we even know there's such an entity as CNBC?

We don't even know who Tyler Durden is. I'm pretty sure he's not Brad Pitts.

Mos Eisley, you'll never find a more wretched hive of scum and villainy...than the Treaserve.

Mon, 04/25/2011 - 17:56 | 1205437 eisley79
eisley79's picture

been using variants of eisley since the remaster went back to theatres in what was it 1999?  First person to ever realize its not a name, but part of a name ;) bravo

Mon, 04/25/2011 - 12:53 | 1203944 MarketTruth
MarketTruth's picture

As they say, "If you don't hold it, you don't own it."

Mon, 04/25/2011 - 13:04 | 1203962 Popo
Popo's picture

This is sort of a non-story.  This guy didn't understand the difference between 'unallocated' and 'allocated' accounts, and he's writing about it as if he got screwed somehow.   It doesn't take a genius to do the due diligence on this subject before investing.

Mon, 04/25/2011 - 13:09 | 1204020 Fred Hayek
Fred Hayek's picture

Yes, but there are at least two pieces of information here.  One is the guy's being wronged or not. The other is that the silver market is sort of like an offshoot of The Producers.

Instead of Bialystock and Bloom, you've Dimon and Blythe Masters.  If they can just be certain that their production (the market for silver) will fail, then no one will expect to cash in on a profit. 

Unfortunately, they accidentally made their tragedy so risibly obvious that they're being laughed at around the world.  Much to their chagrin, silver's a hit.

Springtime for Bernanke.

 

Mon, 04/25/2011 - 13:36 | 1204186 A Lunatic
A Lunatic's picture

Agreed on the non-story. The guy made a stupid decision and as usual a conspiricy is being built around it.

Mon, 04/25/2011 - 14:30 | 1204553 Al Gorerhythm
Al Gorerhythm's picture

"......... and stored them with an East Coast Broker" Storage fees charged means it was sold to him as allocated. Pool accounts do not, in my experience, attract storage fees as pool accounts are used as the operating (daily ins and outs)  stocks of the brokerage house. Contractually, they track the price of silver, sans storage fees. They are not stored, therefore no storage fees. He was ripped. They use your money to buy transient or transferable physical. Pool accounts are are trading accounts. Brokers who use them are shorting the buyer.

Mon, 04/25/2011 - 13:25 | 1204111 NewThor
NewThor's picture

Government promises and entitlements?

"Sorry. Delivery not possible."

 

Mon, 04/25/2011 - 13:31 | 1204165 SparkyvonBellagio
SparkyvonBellagio's picture

Think you actually own those SHARES OF STOCK YOU THINK YOU OWN?

 

Try getting the CERTs..

 

 

You'll come up with 4 letters.... DTCC

 

Google that beach of an acronym.... DTCC

 

 

 

Mon, 04/25/2011 - 14:49 | 1204608 Popo
Popo's picture

Exactly.  Ownership as a concept is filled with all sorts of mythology in the United States.  

You don't "own" any of the stocks in your portfolio.

You don't "own" your home if you have a mortgage, the bank does.

You don't "own" your home if you don't have a mortgage (you rent it from the government.  By definition, if you must make regular payments to keep something, it is rented).

You don't "own" your music, or your software.

You don't "own" domain names.

And for that matter, you don't 'own' anything in a regime that can tax ownership.  Which will be the sell-signal for gold/silver holders.  When the government starts talking about 'taxing' metals transactions -- the game is up.

We live in a kleptocracy...  Those who accept that fact, remember to stay nimble.  Those who don't usually end up bitching about it.

 

Mon, 04/25/2011 - 20:36 | 1206094 Hacked Economy
Hacked Economy's picture

Agree with you there.  You have to have clear title to it and/or physically hold it to own it.

BTW...It's my understanding that both Australia and the UK already tax metals transactions via their respective versions of the VAT.  Get what you want in the good 'ol USA now before the politicians smell blood in the water and try to "calm" the increased PM market activity (that is sure to come as the public become more involved) by taxing it.

Mon, 04/25/2011 - 21:09 | 1206182 RockyRacoon
RockyRacoon's picture

'Splain to me how I don't own this roll of Silver Eagles bought with cash about 15 years ago?

And don't tell me they'll tax it when it's disposed of; there won't be any organized bureaucracy to record it.

Mon, 04/25/2011 - 22:20 | 1206380 Imminent Crucible
Imminent Crucible's picture

Scofflaw. Off with your head.

BTW, sales of silver eagles (or any other bullion item) are not "reportable transactions", unless they are sold for cash in excess of $10,000 total in any tax year:

http://www.certifiedmint.com/myths_lies.htm

Wed, 04/27/2011 - 11:13 | 1211696 RockyRacoon
RockyRacoon's picture

I am a coin dealer.   Anything I sell or buy (profit or loss) is reportable on my income tax return.

Back to square one for you.

Mon, 04/25/2011 - 12:39 | 1203872 slow_roast
slow_roast's picture

Buy physical or perish.

Mon, 04/25/2011 - 12:46 | 1203916 Slewburger
Slewburger's picture

Dont like $50 silver

Get used to it...

http://www.cnbc.com/id/42703813

 

Mon, 04/25/2011 - 13:54 | 1204311 Roger O. Thornhill
Roger O. Thornhill's picture

Yes, when CNBC is reporting the truth then trouble is sure to follow. They started doing a slight bit of truth telling in the summer of 2008 just before the last crash, when they realized they would get caught out in their complete fabrications.

Strange days indeed. Also a note, when I got some gold (my hedge amount) I took the wire transfer difference in silver for the hell of it - turns out to have been a good decision!

Storm clouds are on the horizon.

Mon, 04/25/2011 - 12:42 | 1203879 Dreadker
Dreadker's picture

Yep - why buy unless you plan to look at your pirate treasure every morning and evening... both my wife and I take a quick peek in the safe every now and then too look at our treasure... lol

 

Whats more satisfying... opening your e*trade account and seeing a mix of green and red % numbers or opening a safe (while playing the goonies theme in the background - this is optional btw) and seeing all that shiny silver and gold.... ;-)

 

Mon, 04/25/2011 - 12:55 | 1203953 EvlTheCat
EvlTheCat's picture

Argh Matey!

Mon, 04/25/2011 - 13:18 | 1203967 cowdiddly
cowdiddly's picture

Yep, and if you want a personally recomended place to buy the PHY. I highly recomend these guys. Comes straight from the mines in Mexico and bypasses the middleman like Apmex.. The bars are simply stunning. Proof strikes with a mirrorlike finish, nothing short of Beautiful. Of course these are Northwest Territorial bars who contract there mint work for them and not Englehard or Johnson Mathey. They are .999 bars and as such IRA eligible. My orders have always arrived within 7 days. I am in no way affiliated with them and just for info puposes only.

Oh and I forgot the best part, they take Chase card purchases without a premium, same as cash. lol

 http://www.store.firstmajestic.com/product_details.aspx?id=4

Mon, 04/25/2011 - 13:28 | 1204130 NidStyles
NidStyles's picture

I have switched from NWTmint over to them as well. I love that they actually offer a 50oz bar.

Mon, 04/25/2011 - 13:31 | 1204153 Creed
Creed's picture

Do NOT buy silver from First Majestic out of Canada. Buy the stock, not the physical.

 

my 1st $1500 order went fine, but my $5100 order a few weeks later got held at the US border. I was called by UPS Courier Services and told that if I didn't cough up my taxpayer id # the shipment would be returned.

 

The lady at 1st Majestic (Christina Stone) was all over it while I had orders pending, but after I had problems the contact ceased. She did say that there were multiple orders being held for social security #'s at the border.

 

I've since received a "bill" from UPS Courier Services for a little over $30 bucks for some unexplained reason. Then a second bill with a late fee for not paying their first bill. The 1st Majestic rep has not answered my query as to why I as the receiver am being billed instead of the shipper. I paid over? $100 USD to ship that load.

 

As far as shipment/receipt in a week...around the end of Feb or so their web site was changed to shipment in 2 weeks. I had to e-mail a reminder after 3 weeks to get mine going.

 

Perhaps you have not ordered recently or in a larger amount.

 

Go to Scottsdale Silver, a ZH advertiser. Free shipping after a certain amount, no worries. Helps out the great state of AZ as well. If you want over 500 oz go straight to Tulving for the best deals.

 

 

by cowdiddly
on Mon, 04/25/2011 - 13:09
#1203967

 

Yep, and if you want a personally recomended place to buy the PHY. I highly recomend these guys. Comes straight from the mines in Mexico and bypasses the middleman like Apmex.. The bars are simply stunning. Proof strikes with a mirrorlike finish, nothing short of Beautiful. Of course these are Northwest Territorial bars who contract there mint work for them and not Englehard or Johnson Mathey. They are .999 bars and as such IRA eligible. My orders have always arrived within 7 days. I am in no way affiliated with them and just for info puposes only.

 http://www.store.firstmajestic.com/product_details.aspx?id=4

Mon, 04/25/2011 - 13:56 | 1204173 cowdiddly
cowdiddly's picture

Sorry to hear your troubles from Canada. I live closer to Mexico and they have been flawless fro me. Ordered the Max allowed just 2 weeks ago without a hitch. Also website still says 1 week. I ordered Scottsdale bars before and they sent me some spotted up scrached up trash. Will not buy from again. To each his own. I think your problem is more with the Customs, UPS and Govt wanting to track silver than the Co. 

Mon, 04/25/2011 - 14:02 | 1204373 Abraham Snake
Abraham Snake's picture

Thanks for the tip. I just placed a modest order. The shipping is on the high side but the silver was cheaper, enough. to wash out the higher shipping.

Mon, 04/25/2011 - 14:51 | 1204662 AbandonShip
AbandonShip's picture

"Baaaby Ruuth?"

Mon, 04/25/2011 - 12:40 | 1203880 OrestesPenthilu...
OrestesPenthilusQuintard's picture

From my cold dead hands!!!!!

*crowd goes crazy!!!!*

Mon, 04/25/2011 - 12:41 | 1203888 Dan The Man
Dan The Man's picture

 

sounds bullish

Mon, 04/25/2011 - 15:17 | 1204778 Charlie Bravo
Charlie Bravo's picture

Sounds like he was ripped off.

...storage fees? On a pool account? What the fuck were you thinking when you agreed to give those bozos your money back in 2003 Bill?

Charlie Bravo

Mon, 04/25/2011 - 12:51 | 1203889 Cognitive Dissonance
Cognitive Dissonance's picture

The two scariest words in the English language.

"You lose".

Followed by

"Here, let us compensate you with these beautiful and extremely valuable Federal Reserve Notes".

BTW if he sold his 5000 'paper' ounces and bought 2500 'real' ounces he still lost the PM lottery. But he did get second place.

Mon, 04/25/2011 - 12:55 | 1203945 InconvenientCou...
InconvenientCounterParty's picture

Followed by: Everyone knows PM ETFs are not for taking delivery of the underlying asset. No sir. Of course we don't see you (in particular) as the "bag holder". We don't use that somewhat derisive term. We prefer "basket holder".

Mon, 04/25/2011 - 12:59 | 1203970 Cognitive Dissonance
Cognitive Dissonance's picture

I seem to remember that the last person holding counterfeit script is the ultimate loser and is called the 'paper holder' by the cops. Or sucker. I can't remember which.

For that honor they need to prove they didn't actually print the paper. Thus they are only out the goods/service/labor they exchanged for the worthless paper.

Mon, 04/25/2011 - 12:41 | 1203890 Xibalba
Xibalba's picture

Who wants this ancient relic?!?

 

 

sarc/

Mon, 04/25/2011 - 12:44 | 1203891 Oh regional Indian
Oh regional Indian's picture

Possession. It's the only answer.
India has finally woken up to silver. Physical shortage is palpable, many jewellers (they are also retail bullion dealers) are only taking bookings. Feels mania-like in India alone, but f course, those of us who know and understand the big picture...well, we know and understand.
Such a time. Awesome. Slivers of truth shining out, amidst the chaos.

ORI

http://aadivaahan.wordpress.com/2011/04/24/phase-shift/

Mon, 04/25/2011 - 12:51 | 1203937 Cognitive Dissonance
Cognitive Dissonance's picture

Possession. It's the only answer.

I posses an anatomically correct blow up doll. Does that mean I have a real girlfriend/wife? Or that I'm a real pervert? :>)

Mon, 04/25/2011 - 13:04 | 1203986 Dr. Porkchop
Dr. Porkchop's picture

It means you have a viable personal flotation device in the event of flooding.

Mon, 04/25/2011 - 13:10 | 1204017 Gimp
Gimp's picture

With three holes in it, it might not be viable

Mon, 04/25/2011 - 13:16 | 1204073 Dr. Porkchop
Dr. Porkchop's picture

well you have to plug the holes... gotta be able to adapt in emergencies.

Mon, 04/25/2011 - 13:20 | 1204083 Cognitive Dissonance
Cognitive Dissonance's picture

But what happens when you experience 'shrinkage' in the cold water?

Tue, 04/26/2011 - 08:28 | 1207250 snowball777
snowball777's picture

Sinkage.

Mon, 04/25/2011 - 13:08 | 1204018 Harlequin001
Harlequin001's picture

which is extraordinarily useful in a tsunami...

 

Mon, 04/25/2011 - 13:10 | 1204023 Antarctico
Antarctico's picture

I posses an anatomically correct blow up doll. Does that mean I have a real girlfriend/wife? Or that I'm a real pervert? :>)

It means you are a pervert, not that there is anything wrong with that, and that you need to upgrade to better technology. ;D

Mon, 04/25/2011 - 13:19 | 1204076 Cognitive Dissonance
Cognitive Dissonance's picture

OMG. $5,995? I thought I paid too much when they wanted $29.95 plus shipping. Your link must be to the Wall Street model. :>)

Of course I had no ability to choose such as eye color, breast size etc. It was one size fits all for me. I guess ya get what ya pay for.

Mon, 04/25/2011 - 15:52 | 1204905 Antarctico
Antarctico's picture

OMG. $5,995?

I know! $6K buys a lot clean hookers, or a lot of silver, depending on what kind of action you are looking for. With either, physical delivery is kind of a must! :D

Mon, 04/25/2011 - 13:36 | 1204207 Oh regional Indian
Oh regional Indian's picture

Well CD, alls it means is you have Possession. ;-)

I've heard people do weird thigns with their PM stashes too...

ORI

Mon, 04/25/2011 - 14:07 | 1204375 Cognitive Dissonance
Cognitive Dissonance's picture

For me it's simply a means to the end game. But just like some people are obsessed with paper money, others are obsessed with Gold and Silver.

I must admit, there is something about holding 10 ounces of Gold in your hand or having you wife cover you with 3000 Silver Eagles.

Oops, was that my out loud voice? :>)

Mon, 04/25/2011 - 17:05 | 1205252 Broomer
Broomer's picture

I'm noticing that most of the coins are yellow, and some are gray. Of course they are made of gold and silver.

And I always wondered why someone would stockpile coins to be devoured by inflation.

I always heard that all the world available in the world would fit inside two pools. This is one of them, I guess.

Tue, 04/26/2011 - 02:26 | 1206805 LiquidBrick
Tue, 04/26/2011 - 08:31 | 1207253 snowball777
snowball777's picture

Does that mean I have a real girlfriend/wife? Or that I'm a real pervert?

 

Neither...unless your anatomically correct doll is an imitation of livestock...or a corpse...or a dead cow's corpse.

Mon, 04/25/2011 - 12:42 | 1203893 malek
malek's picture

That experience will occur to a growing number of people in the near future (<2 years).
At least they will learn a lesson from it.

Mon, 04/25/2011 - 12:45 | 1203895 johngaltfla
johngaltfla's picture

Wash, lather, rinse, repeat.

If you don't hold it, you don't own it.

Then again, I've said that since $7.80 per oz.

Mon, 04/25/2011 - 12:43 | 1203901 Larry Darrell
Larry Darrell's picture

"Aaaaaaannnd...........it's gone."

Wonder how many more physical ounces he was robbed of by paying all those "warehouse" fees?

 

Mon, 04/25/2011 - 12:46 | 1203903 Dr. Porkchop
Dr. Porkchop's picture

A bird in the hand..

Mon, 04/25/2011 - 12:44 | 1203904 RobotTrader
RobotTrader's picture

128 million shares of SLV traded today.

Highest of the year.

Mon, 04/25/2011 - 12:51 | 1203939 Tyler Durden
Tyler Durden's picture

And according to BlackRock it is the safest investment ever: BlackRock Issues Refutation Of SLV Fraud Allegations; Is It Time To Panic For SLV Holders?

Mon, 04/25/2011 - 13:00 | 1203974 Cognitive Dissonance
Cognitive Dissonance's picture

I'll buy that.

The story, not the SLV.

Mon, 04/25/2011 - 13:20 | 1204097 DoChenRollingBearing
DoChenRollingBearing's picture

@ Robot,

Anyone take you up on your recent Silver Challenge?

Mon, 04/25/2011 - 12:47 | 1203905 LeBalance
LeBalance's picture

UT hooked on their own horns?

Mon, 04/25/2011 - 12:47 | 1203907 Dr. No
Dr. No's picture

The price of silver continued to climb. On January 17, 1980, it hit $50 an ounce. At that time, the Hunts held $4.5 billion in silver—a $3.5 billion gain on their $1 billion investment. The various limitations and rules changes imposed by the commodities markets had no effect but to push the price of silver higher, until finally the COMEX announced that it was suspending the trading of silver and henceforth would only accept liquidation orders

Next up, more COMEX rule changes until finally, only liquidation orders are accepted.

http://www.silvermonthly.com/182/bunker-hunts-attraction-silver-history-cornering-silver-market/

Mon, 04/25/2011 - 12:45 | 1203909 sellstop
sellstop's picture

Does that mean that I can't take delivery from SLV?

I smell a rat.

gh

Mon, 04/25/2011 - 12:48 | 1203910 Cassandra Syndrome
Cassandra Syndrome's picture

The question is, are all the commodities that are paper and electronically traded oversubscribed and do not have the physical now or the propensity of future physical quantity at the given date of contract, to back them up?

If the quantity of physical is less than the notional quantity, then the prices of all commodities, even at record levels are completely undervalued.

This is dangerous shit as we need these commodities to survive.

Mon, 04/25/2011 - 13:34 | 1204175 jerry_theking_lawler
jerry_theking_lawler's picture

CS, That is the crux of the silver/gold trade....

 

if they are not accurately valued, then everything else in our lives are not accurately valued. jmho.

that means....danger shit...exactly. it means we can't even go out and buy a happy meal in REAL terms.

Mon, 04/25/2011 - 14:45 | 1204623 Al Gorerhythm
Al Gorerhythm's picture

The answer is, Yes, or Blingo!

Extrapolate.

Tue, 04/26/2011 - 08:40 | 1207278 snowball777
snowball777's picture

Yes, they're undervalued...this 'dangerous shit' happens (when certain entities are allowed to short more contracts than can possibly be delivered in a year, for example).

Market? Maybe. Free? Hell, no!

Mon, 04/25/2011 - 12:46 | 1203914 MGA_1
MGA_1's picture

And, when the music stops....

Mon, 04/25/2011 - 12:52 | 1203919 Sudden Debt
Sudden Debt's picture

I heard something similar about a silver savings plan that doesn't deliver what they first promised.

You could buy 100oz per batch and pay every month a 1/12. And after 12 month you where suposed to get delivery. They didn't send the silver as promised but decided to pay out the spot deverince as a extra. But as we all know that the premium also rises and the fact that if you wanted to buy silver with the money anyway, you where confronted with a 20% tax.

I don't care about all the silver "services" and all. I just buy and if I don't get it in my hand within 2 weeks: I reclaim my money.

 

I have a very simple rule: Always read the fine print. And when "the fine print" takes over 50 A4 pages to print or if you need a consultant just to understand it, don't bother reading it and step away.

 

Mon, 04/25/2011 - 13:02 | 1203979 SilverRhino
SilverRhino's picture

Cash for physical requires no fine print.   Just an assay / magnet test.

Mon, 04/25/2011 - 13:58 | 1204358 lincolnsteffens
lincolnsteffens's picture

I bought over 100 oz. of sterling flatware at $27.50/oz.on Saturday. It was dead plain stuff and only good for scrap. Am I complaining? Nooooooooooooooooooh!

Mon, 04/25/2011 - 12:49 | 1203920 Racer
Racer's picture

Isn't this exactly like the 'money' in the bank?

If even a proportion wanted to take it out there would be not be enough 'money'.. all the government 'guarantees' are in fact completely worthless. It is just another emperor has no clothes situation and they just hope the sheeple keep on being stupid enough to believe the cries of 'such beautiful clothers the emperor has on today'

Mon, 04/25/2011 - 12:49 | 1203928 Hulk
Hulk's picture

Surprise!  Not...

Mon, 04/25/2011 - 12:50 | 1203935 ChanceIs
ChanceIs's picture

The guy took the correct strategy - but he got nailed on the taxes.  I wonder what recourse he had.  OTOH, the prospectus should have been clear WRT the pooling vice "allocated" aspect of the vehicle.  If it was "pooled" from the get-go, then there is no fraud, unless the broker told him it was allocated and it wasn't.

Sprott is supposed to be allocated, but I see that you can't withdraw unless you have a larger position.  At least Sprott is saying that they hold only bullion - unlike SLV.

Mon, 04/25/2011 - 12:51 | 1203940 lieutenantjohnchard
lieutenantjohnchard's picture

any minute now we ought to get the crowd of altruistic posters advising us to sell, sell, sell before it's too late. and then they call us perma-gloomers for holding silver, even as they sweat out for us the pending apocalypse.

btw: how can one be called a gloomer when the investment you hold is up ten straight years, or in the case of silver up 150% in a year? you would really have to have a wierd take on life to assume someone under these circumstances would be unhappy regarding their investment.

Mon, 04/25/2011 - 12:59 | 1203964 lieutenantjohnchard
lieutenantjohnchard's picture

i ought to have been a little clearer. i'm referring to physical silver versus the paper.

Mon, 04/25/2011 - 12:53 | 1203947 AcidRastaHead
AcidRastaHead's picture

That's why when I buy gold, I focus on Rapper's teeth.

Mon, 04/25/2011 - 12:56 | 1203950 Lord Peter Pipsqueak
Lord Peter Pipsqueak's picture

This story makes the Univ Texas purchase,without taking physical delivery even more difficult to understand.If they know how close to meltdown the system is to warrant the purchase in the first place why then risk storage in New York where it has probably been lent out fifty times over,the good ole boys should take it down to Texas and keep it thayaarr!!!

(Apologies in advance,best Texas accent possible for a Brit).

Mon, 04/25/2011 - 13:31 | 1204151 Jonas Parker
Jonas Parker's picture

No apology necessary, you did fine on the accent! Remember the Alamo!  JP

Mon, 04/25/2011 - 14:06 | 1204385 MachoMan
MachoMan's picture

If you're trying to send a message to the world that you can turn the paper into physical if you want and there is no shortage, then UT's decision is perfectly reasonable.  Of course, the half-life of "calming" actions is shorter by the day...

Mon, 04/25/2011 - 12:57 | 1203952 Robslob
Robslob's picture

Silver is great but you got to have gold as well.

I am overweight silver and way too lite on gold. Thinking Maples over Eagles...wouldn't want the government to come get "their" property back...

Mon, 04/25/2011 - 12:55 | 1203955 kito
kito's picture

sounds like the guy had an slv type account that doesnt allow for delvery, and was clueless as to how it worked. i think the moral of the story is check to make sure that your fund is either one that tracks silver or one that actually holds it. the moral of the story shouldnt be that there is no physical silver left.

Mon, 04/25/2011 - 12:57 | 1203956 Piranhanoia
Piranhanoia's picture

I particularly enjoy those recommending you keep your assets in other countries for safety. I am getting ready to send my wallet to Belgium for that purpose.

Mon, 04/25/2011 - 12:55 | 1203957 Paul Bogdanich
Paul Bogdanich's picture

Been saying for a year that the largest risk in precious metals is political not economic.  It is a little advertised feature of the law that you can't demand payment in kind.  Only the money value of the holdings.  That's the law since 1974 it's just that it is seldom noticed becasue before now delivery has usually been possible.  Same thing in stocks.  Once deposited at a bank or broker you only have the right to the money not the stock.   

Mon, 04/25/2011 - 12:59 | 1203959 TruthInSunshine
TruthInSunshine's picture

True story:

Man goes to redeem silver certificate, and some bearded clam comes to get the silver and stamp his ticket "delivered."

Man loooks up to see it's actually The Bernank, with a trainee names Blythe in tow.

Bernank looks at the man, reads his certificate, and proceeds to kick the man in the balls swiftly, take his ticket and shred it through the 'Fed Reserve/JPM' marked shredder sitting nearby, while concluding by screaming "consider it delivered, Bitch! Now GTFO!"

The Bernank tells trainee Blythe "and that's how it's done, Masters," as they slink down the dark and foreboding hallway, walking away spiritedly.

Mon, 04/25/2011 - 12:56 | 1203960 nah
nah's picture

BANKS MAN

Mon, 04/25/2011 - 12:57 | 1203966 cboewiz
cboewiz's picture

how old is the story that he sold his silver at 18?

 

the silver shortage sounds like the housing story of 2007. I went a coin show last weekend and i could have all the silver coins i wanted.

 

 

Mon, 04/25/2011 - 13:04 | 1203998 CrockettAlmanac.com
CrockettAlmanac.com's picture

You didn't buy any so you must not have wanted any therefore "could have all the silver coins i wanted" might mean that there was none available at all.

Mon, 04/25/2011 - 13:10 | 1204037 tmosley
tmosley's picture

Coin shows are for numismatics.

This is like comparing the real estate market with the dollhouse making industry.

Mon, 04/25/2011 - 22:19 | 1206368 RockyRacoon
RockyRacoon's picture

As a numismatist I can verify your comment.  Yes, I am an ANA member. A coin bourse has some bullion available just because it's popular, but most offerings are for collectors.   I sold 18 graded (slabbed) Morgan dollars last week on eBay.  They ranged from AU-55 to MS-64 from 4 different grading services.   That's not much silver but the net was about $4K.   I'm rolling that into bullion.   Now that's a trade I can live with!

Mon, 04/25/2011 - 13:12 | 1204050 Orémus
Orémus's picture

so you dont believe to the silver shortage and bought physical silver anyway ?

when the price is so high ?

Mon, 04/25/2011 - 13:49 | 1204276 SheepDog-One
SheepDog-One's picture

'Price is high'? According to what?

Mon, 04/25/2011 - 12:59 | 1203969 Pedro
Pedro's picture

So if Obama/Holder came out in force against the oil speculators, will they go after the silver speculators?  Especially the ones or "JPM" who shorted it and truly manipulate the market?  I doubt it.  They get their cake and eat it too while us unimportant goofs take it in the wallet.

Mon, 04/25/2011 - 13:03 | 1203994 Dr. No
Dr. No's picture

So if Obama/Holder came out in force against the oil speculators

Lol.  You are talking about Inaction Holder right?  Appointing Holder was a not so subliminal way to say Obama's not going to do anything.

Mon, 04/25/2011 - 13:30 | 1204159 trav7777
trav7777's picture

Washington CityPaper didn't call him Eric "Place" Holder for all those years in the 90s (when he was US atty) for nothing

Mon, 04/25/2011 - 13:00 | 1203973 savara
savara's picture

Very true, I went to Delhi's Bullion market and  delivery rate of silver already has a premium of around 22$/kg

Mon, 04/25/2011 - 12:58 | 1203976 LRC Fan
LRC Fan's picture

Peter Schiff was just on CNBS and going on about how gas is actually going down in price, in terms of real money.  Said you can get a gallon+ if you just have a "real" dime, minted before 1965.

Someone asked the stupid question if Peter had sold any silver into this strength, which evoked a nice laugh and Peter said he hasn't sold an oz since he started buying 10 years ago. 

The panel was pretty quiet, then Peter asked "do you guys have ANY silver?  Gold??" and they all just sort of nervously laughed and that was it. 

I've been asking friends and family the same question for a few months now.  Did you buy any silver yet?  They all just look at me funny, except for maybe a handful who have a few oz of silver or those who might start buying eventually, when prices are probably way higher.  But if silver dips to, say, $35 or lower, I will be screaming and in everyone's face that I know and care about to BTFD. 

Mon, 04/25/2011 - 13:11 | 1204045 sellstop
sellstop's picture

So the gas is cheap?

Or the dime is over priced.

Gas is used. The dime is stored. If the market uses less gas. Will the dime be worth even more?

gh

Mon, 04/25/2011 - 13:41 | 1204225 NotApplicable
NotApplicable's picture

The point is that over time, the old dime has held its purchasing power relative to the gas as compared to the new dime (Gresham's Law). As always, all valuation is subjective and relative, based upon what you remember about yesterday, what you see today, and what you believe to be coming tomorrow. There are no absolute ratios amongst any commodities, and to believe there should be is to fall into the trap of the treasury/central bank "stabilizers."

Human wants and needs constantly determine these ratios in a marketplace, where the marginal buyer, and the marginal seller discover a price that satifies them both.

Because a silver dime, you see, is only as valuable as your desire it to hold it in leiu of other goods/services/investments/etc...

Mon, 04/25/2011 - 13:37 | 1204193 Jim in MN
Jim in MN's picture

You do realize you're not supposed to tell anyone, right?  And neither are the people you are asking.  It's kind of a tricky thing to be outright asking.

Mon, 04/25/2011 - 14:53 | 1204659 doggings
doggings's picture

Peter's daily radio show loop is well worth a listen today, talking about this same thing and has Lew Rockwell on there too.

http://schiffradio.com/f/loop

Mon, 04/25/2011 - 22:22 | 1206388 RockyRacoon
RockyRacoon's picture

I've been asking friends and family the same question for a few months now.  Did you buy any silver yet?

So when times get tough, if they decide they want some they'll know where to go get it.

Yeah, OK, so you're armed and all that.  They know that, too.  Enjoy your vacations away from home -- sleep tight.

Mon, 04/25/2011 - 13:01 | 1203978 Dan The Man
Dan The Man's picture

 

Quick survey...

Hypothetical (probably)...who will part with their metal if it goes to $75 tomorrow?

Mon, 04/25/2011 - 13:16 | 1204072 nmewn
nmewn's picture

LOL...seventy five dollars in what?

Mon, 04/25/2011 - 13:18 | 1204087 cxl9
cxl9's picture

So what you're asking is, if the dollar dropped to 1/75th toz. of silver, would I buy some of them? No, I don't think I would.

 

Mon, 04/25/2011 - 13:19 | 1204089 Dejean Splicer
Dejean Splicer's picture

I will not sell until I have the epiphany.

Mon, 04/25/2011 - 13:21 | 1204092 tmosley
tmosley's picture

I will be selling a few oz as it breaches above $50 an oz, as I promised the family we would buy a nice travel trailer at that price.

They don't really want to sell any now, but I feel that it is important to keep your word, and to enjoy the fruits of your mental labors, even at the expense of a tiny fraction of your purchasing power.  We might compromise on a used one.

Mon, 04/25/2011 - 14:41 | 1204600 Calculated_Risk
Calculated_Risk's picture

I feel ya T.. I promised my woman an engagement ring ;) 

Mon, 04/25/2011 - 15:00 | 1204697 Al Gorerhythm
Al Gorerhythm's picture

Pre-nup organized?

Mon, 04/25/2011 - 15:59 | 1204975 Calculated_Risk
Calculated_Risk's picture

Yeah! All my ounces are mine! haha

Mon, 04/25/2011 - 13:28 | 1204142 DoChenRollingBearing
DoChenRollingBearing's picture

@ Dan,

If the price of silver jumped even to $50 I would sell SOME, and change it in for gold.  I will anyway, just as soon as I can break the bonds of domestic labors...  LOL.

When silver reaches $75, I will trade it a bit more for gold.

But, I will always keep a lot of silver: "grocery money" if TSHTF.

Mon, 04/25/2011 - 13:47 | 1204258 NotApplicable
NotApplicable's picture

I'll trade silver dollars for sheep, goats and anything else I might need, but other than that, PMs are for saving, not "investing" in a taxable fiat event.

Mon, 04/25/2011 - 13:29 | 1204145 vas deferens
vas deferens's picture

A move like that, in one day, would mean a CRIMEX default or the dollar getting killed either way it would be foolish to sell unless transferring wealth into another asset. To sell silver and receive dollars would be very foolish in the longer term.

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