Guest Post: Silver - Still The Investment Of A Lifetime

By Giordano Bruno Of Neithercorp Press

Silver: Still The Investment Of A Lifetime

Silver is the common man’s currency. It always has been, and it
always will be. While gold holds its place in history as the great
stabilizer of economies and the shield against hyperinflation, its shine
and its safety should not distract us from its brother, silver, whose
uses are numerous and whose value is often more attainable for those
seeking a solid investment outside of precarious paper securities.

Gold’s unprecedented upsurge in price the past year alone is now
becoming the stuff of legend, and it is also something we at Neithercorp
have been predicting for a while now:

http://neithercorp.us/npress/?p=184

http://neithercorp.us/npress/?p=579

The mainstream media attacks on precious metals were so extreme last
year that they began to border on the bizarre. The “cult of fiat” was
relentless in their attempts to slander gold investors and it seemed as
though no matter how well the yellow stuff did, or how dismal the
dollar’s performance was, they would never get tired of the
disinformation game. Fast forward a year later, however, and they have
been utterly silenced. What a difference twelve short months can make…

As I write this, gold is holding after a spectacular drive at around
$1390, which is in line with my prediction of $1350 to $1450 by winter
2010, and on track to meet my prediction of $1500 by the beginning of
next year. We’ll have to wait and see, but what seemed absolutely out
of reach during this summer is now looking rather simple to achieve
today. Of course, silver has been a bit harder to put a finger on, and
there are many unfortunate reasons for this.

The silver market was wholly dominated for at least two decades by
only a few corporate banks, but primarily through the infamous JP Morgan
and the HSBC. Using coordinated naked short selling and massive
amounts of capital, they have been able to knock silver down every time
its value fell below a certain ratio to gold; usually 60:1. Only
recently has that ratio moved slightly closer to the true wealth of
silver. The historical average ranges between 16-33 ounces of silver
for every ounce of gold.

These banks have also been issuing paper silver securities, usually
in the form of ETF’s, which have no REAL silver backing them. These
securities give investors the illusion that there is too much silver on
the market, and not enough buyers. This causes devaluation in the
metal.

Gold has suffered from the same manipulation in the past, but the
silver market is even more tightly controlled, at least, until this
year…

In November of 2009, a metals trader in London by the name of Andrew
Maguire contacted the CFTC with inside information that JP Morgan Chase
Bank was deliberately interfering with the silver market on an enormous
scale. He not only told the CFTC how the bankers were doing it, he
PREDICTED when they would do it again! Maguire gave two days advanced
warning that JP Morgan would attack silver on Feb 5, 2010. The market
played out exactly as he said it would:

http://www.gata.org/node/8466

The bankers were now caught red handed. The market could only go up from there….

Indeed, silver is now holding at around $27 an ounce, up from less
than $10 an ounce two years ago, closing in on a 300% gain. If you
bought silver in 2008 as I did, then you’ve made out incredibly well in a
very minimal time span. But what about people who were afraid to dive
into the market back then, or who just weren’t aware of silver as an
investment at all? Have they missed out? Is the $30 mark as good as it
gets? I believe that silver still has a long way to go before it
peaks, and room yet for millions of new buyers who are in need of a safe
haven against the imploding dollar but don’t have the finances to
purchase gold. Here’s why…

Bank Fraud Exposure Hitting Mainstream

The Andrew Maguire incident was just the beginning and the event
acted as a springboard. Both JP Morgan and HSBC are now under
investigation for silver manipulation pending a lawsuit filed in New
York. The suit accuses the banks of using their 85% commercial net
short position in the silver market to control its value on the COMEX:

http://www.benzinga.com/news/10/11/579017/jp-morgan-chase-hsbc-face-charges-in-manipulating-the-market

CFTC Commissioner Bart Chilton has announced his belief that there
is, in fact, manipulation of the silver market. In his statement he
said:

“I believe that there have been repeated attempts to influence prices
in the silver markets. There have been fraudulent efforts to persuade
and deviously control that price. Based on what I have been told by
members of the public, and reviewed in publicly available documents, I
believe violations to the Commodity Exchange Act (CEA) have taken place
in silver markets and that any such violation of the law in this regard
should be prosecuted.”

http://www.cftc.gov/PressRoom/SpeechesTestimony/chiltonstatement102610.html

This is an extremely rare admission by the CFTC, which has for many
years ignored all complaints and evidence pointing to bank interference
in precious metals.

The Department of Justice has also launched a parallel probe into
criminal wrongdoing on the part of JP Morgan (though I doubt much good
will come out of the DOJ):

http://www.nypost.com/p/news/business/feds_probing_jpmorgan_trades_in_gZzMvWBqOJpB55M7Rh9vwM

The bottom line is that the corruption in silver trade has been
brought into the light of day, which means banks will have to, at the
very least, back away from their activities to a point, which will allow
PM’s to grow according to free market fundamentals, instead of global
banking whims. This explains why silver has jumped to $27 an ounce so
quickly, but it also signals the possibility of even greater gains in
the near future, especially in light of QE2 and the weakening dollar.

Silver Supply Declining

Just as with gold, silver availability, from mining to inventories,
is in decline. This would not be so much of a catalyst if demand
remained at levels similar to a decade ago. That is not the case.
Demand is skyrocketing.

In June, the U.S. Mint announced it had run out of silver bullion blanks for the production of coins like the American Eagle:

http://www.zerohedge.com/article/us-mint-runs-out-silver

While COMEX silver inventories continue to decline because of constant customer withdrawals of physical bullion:

http://news.coinupdate.com/comex-silver-inventories-continue-to-decline-0368/

Mining in many areas is also beginning to fall, including in Peru, a
major source of metals like copper, gold, and, of course, silver:

http://www.commodityonline.com/news/Copper-gold-silver-production-down-in-Peru-33052-3-1.html

On top of all this, silver is used in the making of many industrial
and consumer products, including electronics, photography, batteries,
and engine components. This puts an extra strain on silver supplies
that is not felt as prominently with gold. Meaning, the ability of
silver to outperform gold in terms of demand and investment potential is
very high.

Dollar On Its Last Leg

The private Federal Reserve has been injecting fiat into our
financial system for quite some time. The acceleration in 2008 heralded
a new stage, however, in the devaluation of the dollar. Contrary to
popular belief, the bailouts and quantitative easing implemented that
year never actually ended. The bailouts of Fannie Mae and Freddie Mac,
for instance, have continued non-stop every quarter since the mortgage
crisis unfolded. Without a full audit of the Fed’s accounts, there is
no way of telling how much money has been created out of thin air. We
do know that it is enough to drive foreign investors and central banks
out of the dollar and into gold and silver en masse:

http://www.commodityonline.com/news/Why-Central-Banks-continue-to-buy-gold-32803-2-1.html

The announcement of QE2 has compounded the precious metals issue (not
because the Fed is creating more fiat, they were already doing that
unhindered). No, it is because the Fed signaled to the world OPENLY
that they were about to deliberately devalue the Greenback, instead of
just doing it under the radar. They erased any delusions left in the
investment world had that they would try to protect the stability of our
currency. As a result, the dollar index has dropped like a rock into
the recesses of some distant Grand Canyon, while PM’s have spiked.

As gold climbs into the $1500 range, the effect on silver will be
evident. Gold will be less and less attainable by average people with
lower incomes, but these same people will still be exposed to dollar
devaluation, and the need for a hedge against inflation; enter silver.

I believe silver will become the single most important investment of
our age, filling the void in the wage gap gold leaves behind. As gold
shoots into the stratosphere, it will be silver that people turn to most
for smaller investment needs, which means much higher demand and much
greater returns for those who are smart enough to buy now. $27 an ounce
is incredibly affordable, especially when considering that the metal
has the potential to reach $75-$100 an ounce in the next two years (and
that is a conservative estimate).

There is little doubt that the dollar plunge will continue to drive
people towards PM’s. While Ben Bernanke and Timothy Geithner have both
made claims pre-G20 that QE2 is not a move to devalue, the rest of the
world is unconvinced. Reuters recently called the meeting in Seoul,
Korea “G19 plus 1”, as foreign nations become infuriated with the
Federal Reserve’s actions:

http://www.reuters.com/article/idUSTRE6A62BC20101107

Even Alan Greenspan has come out in opposition to QE2, saying it is a dangerous act of devaluation:

http://www.reuters.com/article/idUSTRE6AA00320101111

Now, why is Greenspan of all people suddenly coming out against
blasting the financial system with fiat? It’s hard to say. We have
written here often at Neithercorp about the deliberate destabilization
of the American economy in order to remove the dollar as the world
reserve currency and replace it with the IMF’s Special Drawing Rights
(the SDR). We have also written about the possibility that the IMF
will attempt to insinuate itself into the U.S. system as a “savior”,
implementing supranational control over our fiscal infrastructure, just
as it is trying to do in Ireland today:

http://www.bloomberg.com/news/2010-11-12/shadow-of-imf-spooks-irish-taking-pay-cuts-to-avoid-greece-style-bailout.html

It is perhaps possible that the Fed itself (the institution, not the
people who run it) may one day be offered up to Americans as a
sacrificial proxy to be torn down as the lone culprit of global
collapse, only to then be replaced with the IMF (which is worse, because
they don’t even live in this country). In any case, the dollar is
going for a ride into the backwaters of historical infamy, and it will
take us all with it if we do not protect ourselves from its demise.
Gold, and most especially silver, give us the power to do this.

The Return Of Real Money

While many people in the Liberty Movement are preparing diligently
for the inevitable dollar plunge, some have still not delved into the
world of PM’s, either because they are afraid it will be too
complicated, or because they feel it is unnecessary. Obviously,
survival goods are absolutely imperative, along with a solid plan for
keeping one’s self and his family safe. However, the need for an
alternative economic outlet to take the place of the failing dollar
should not be overlooked, even by the average prepper. A system of
barter is a tremendous starting point for such an alternative, but
eventually, expanded trade also requires some form of currency.
Preferably, one based on a tangible commodity that can’t be recreated to
infinity. Precious metals have fulfilled this role for thousands of
years, outliving every fiat currency ever printed. Of these metals,
silver was always the one most commonly used.

Beans and bullets aside, Americans need a way to protect their
savings from what is coming, as well as a way to support a replacement
market outside of elitist control. There is a reason why central banks
across the globe are stocking up on PM’s; because they know full well
that the dollar’s days are numbered, and they plan to capitalize on its
death. If the banks are allowed to dominate the supply of PM’s, simply
because only a few people had the good sense to stock them while they
were readily available, then our options for a free economy grow that
much slimmer.

There will always be dips, corrections, and fluctuations in metals,
and this should not deter us psychologically from their ultimate
benefits. Every citizen of this country can and should purchase at least
some insurance against hyperinflation and monetary catastrophe, and the
most affordable insurance with the greatest potential today is physical
silver, bar none.

Comments

[ATG]

Good luck with that

What did one lemming say to the other?

So far so good!

Speaking of utterly silenced:

http://www.safehaven.com/article/5133/the-great-silver-spike-of-1980

[tmosley]

Enjoy your hard earned dollars.

[ATG]

Thx tm

Went through this in 1980

Farrell's Rules 1-6, 9&10 may apply here:

http://bigpicture.typepad.com/comments/2008/08/bob-farrells-10.html

[Bay of Pigs]

You aren't Rich from Ackerman's board are you? Bob Farrell's Rules? LMAO. Another numbskull compares it to 1980. Good luck with that reasoning.

[Imminent Crucible]

I love these witless silver-bashers.  They always emerge whenever silver takes another leg up, only to be proven wrong yet again.  And again.

I began buying silver when it was just over $4.  My cost basis is so low that silver could get cut in half and I'd still be in great shape.

A silver basher is a guy who didn't have the wit to buy when it was cheap, and now has to try to justify his stupidity.  ATG=Nadlerite=Loser

[The Rogue Economist]

Nice rules, and completely accurate. But what you're not seeing is that this reversion to the mean isn't in gold, it's in the value if the dollar.

[ATG]

so far junkers have nothing profitable to say, sigh

[ATG]

for the record, silver hit its target

http://stockcharts.com/charts/gallery.html?s=%24silver

[dehdhed]

maybe according to the point and figure chart but the measured move from the breakout of the huge inverse head and shoulders would be more like 31.   close but not there yet.   and then it usualy just consolidates for a while.   sometimes it retraces about 50% of the breakout move and sometimes it even retests the breakout point if fundamentals don't justify the breakout (but they do).

the main thing is once the initial retest is over, the slope of the move will continue for as long as the pattern took to develop. since the pattern took 2 years to develop,  and if you could extend the chart 2 years,  you could draw a two year projection line that would target the logrithmic scale of like $150 or more, which is pretty freaking amazing.

[Quinvarius]

See.  I feed trolls.

[Michael Victory]

nicely organized gio.
we should chat.

~MV

[A Nanny Moose]

Just don't feed them after midnight. No wait...that's Gremlins

[mark mchugh]

Dear Numbskull,

If you ever find yourself on the phone with your grandmother who's fifty years in the past (that would be 1960), and she's about to bury a time capsule that you can open now, what would you ask for?

• Most of the Dow components from that era are long gone, and Apple doesn't exist yet.
• It's illegal for her to own gold, remember?

I'd tell grandma to bury quarters for me.  A 1960 quarter is worth $4.70 today

http://www.coinflation.com/coins/1932-1964-Silver-Washington-Quarter-Value.html

Minimum wage in 1960 was $1.00 or .715 troy ounces of silver, that's worth $18.80 today.

So, uh...what's in your time capsule?  Woolworth's stock?

And what are you putting in your grandkids time capsule?

[A Nanny Moose]

+90%. A fellow fan of junk silver. Junking might be a compliment.

Was in a local diner the other day, that has been around since the 1940s. On the wall is a pic from inside the diner ca. 1940ish (forget the exact year). The menu can be seen in the background.

Hot Dog - $0.10

Root Beer - $0.10

Now, we spend the melt value of that quarter on Starbucks.

[mark mchugh]

That first line of yours is gold! er, silver I mean.

Gas was 0.31 in 1960, so that quarter buys more now than it did fifty years ago.

I've got a question for you, if you see this again.  Is there any disadvantages to junk silver coins?  I look at it as melt value is melt value, but .9999 fine stuff seems to command more respect in terms of premium.  Any thoughts?

(plus I just like to think about all the places and people the coin's been through.  Crazy stuff, like I wonder where this coin was when JFK was shot and such.  I know, nuts.)

[Strongbad]

It commands a higher premium because it is more pure and hence easier/cheaper to refine.  Also because the producer has to recover his production costs of creating the .999 bars/rounds while sellers of 90% silver did not pay the US Mint to make the coins for them.  Finally, a 90% coin that has been circulated for 40 years is not going to be its full weight due to wear.

Still, 90% can't be beat for price and reconition factor.

[mark mchugh]

Thank you for the insightful reply.

[SGTbull07]

- 1 for not recognizing the blatant 100 to 1 paper manipulation of the metals per Jeff Christian

- 1 for not having the courage to stand with humanity and against the criminal banking cartel

- 1 for your general unsavory flippant Cliff Clavin-like tone

[Chappaquiddick]

SGT - I've just seen your latest posting on youtube

 http://www.youtube.com/user/SGTbull07#p/u/12/KGpi1gxtAOY

Is this for real?  A years output traded in a day?  Could you confirm what that volume was composed of - pure physical or paper only or a mix (if so what was the ratio of physical to paper)??  Are you aware of any equivalent activity on the LBMA??

If you're minded to respond I have another question:  Why do you think that the paper market (which offers cash settlement terms) will crash if there is a commercial signal failure should the exchange be unable to meet physical delivery deadlines/volumes.  Surely both the paper and the physical markets will rise - AND - how could you price these contracts differently, surely the derivative and physical markets influence one another in (supposed) price discovery??

Thanks

[Quinvarius]

Dollar got slammed today in a down stock market.  So did Treasuries.  Good luck with your deflation fantasy.  I kinda remember explaining this would happen just yesterday.  But you go ahead and declare victory against inflation as silver trades from 18 to 29 to 26.  LOL.  Yes.  Huge victory for deflation has been won thanks to the use of capital controls by the commodity exchanges.

Maybe you should remind us all of your degrees and such that prove silver never went from 18 to 26 and gold never went from 1100 to 1350.  I seem to remember those were the entirety of your deflation thesis.

[Shameful]

Well hopefully the big boys learned from Bunker Hunt.  Don't buy on margin and take delivery.  If someone anted to run at the system seems that's the way to do it.  Rule changes mid game are a mother.

[shortus cynicus]

Changing rules by exchange IS A RULE. So, any change is not realy a change, its has to be expected anytime.

Last change will be delivery 'susspention', because of some 'disturbing events' or 'national security'.

FRN is suspended since 1971 and nobody complains about it. So will be COMEX paper too until this 'financial terrorists' demanding delivery are all dead.

[flacon]

"There will always be dips, corrections, and fluctuations in metals, and this should not deter us psychologically > from their ultimate benefits."

Absolutely. Keep on buying. That's the beauty of their 100:1 leverage - it only takes a spark to get a fire going. 

[RockyRacoon]

No!  Time to dump your metals.

From a pre-eminent "expert" who even quotes Nadler!

Nov. 12, 2010, 5:20 p.m. EST

Why gold is a bad investment       
Precious metal lures susceptible buyers into a Midas crush

By Jonathan Burton, MarketWatch

SAN FRANCISCO (MarketWatch) — Gold does not always glitter, but you wouldn’t know that from surging worldwide interest that has turned the yellow metal red-hot.

http://www.marketwatch.com/story/why-gold-is-a-bad-investment-2010-11-12?siteid=nwhpf

But, wait!  There's more:

Gold's rise may end badly for investors

Many investors expect gold to protect their portfolio from economic uncertainty, but gold's recent sharp rise is being fueled by speculation that could end badly for buyers, says Kurt Brouwer, editor of MarketWatch's FundMastery blog.
 Video: Gold's rise may end badly for investors.

[mark mchugh]

SShhhhhh!!!!!

Can't you just let them beat down the price a little longer?

I'm still holding too much paper!

[His Dudeness]

Don't squeeze the charmin!

[Jendrzejczyk]

This will scare people away from silver---

http://today.msnbc.msn.com/id/22536241

It's worth the click.

[unwashedmass]

does anyone know how to make a "community page" for Crash JPM, buy silver" on facebook?

[jomama]

'What I found out is the facial tissues is where the body will store any excess silver.'

-Cured his acid reflux disease

-No more sinus infections

-Arthritis went away

But is eating it/applying topically worth looking like a smurf?

[WhiskeyTangoFoxtrot]

But you can't eat silver!  <sarc>

[StychoKiller]

Just when ya think the World couldn't possibly get any stranger! :>D

[saulysw]

Now there is a REAL silver bug.

I wonder what color he goes when he's hot? Purple?

[tallystick]

That's a  colloidal silver scare story. This guy ate silver salts, not colloidal silver,  which isn't  high enough concentration to cause  discoloring.

Incidently, this is how the term "bluebloods" originated. Nobility eating from silverware.

[asianist]

Strangely enough, the blue kind of suits him. The coloring is nice & evenly distributed. He looks a little odd, but not unpleasant. The only problem would be the stares you'd get from strangers.

[Spalding_Smailes]

It's really funny how VXX got blowtorched for months down 35% last 6-8 weeks before QE 2, then the reverse split put her back in the high 40's....., now the bad news spills forth ....

Hmmmmmmmmm...

[ATG]

Bingo

[Turd Ferguson]

(obligatory)

http://www.youtube.com/watch?v=UMRo5XCKddQ

[ATG]

;

[Spalding_Smailes]

And I got blowtorched on my vix bet. Fucking rookie ....

[Turd Ferguson]

This looks like pretty good analysis, too:

http://tfmetalsreport.blogspot.com/2010/11/all-that-glitters.html

[Slewburger]

Nice Turd. Subtle

[ATG]

MHFT is that you?;

[Turd Ferguson]

about as subtle as a fart in church  ;)

[GoinFawr]

Was it Confucious who said,

"He who fart in Church, sit in his own pew"?

[mark mchugh]

Turd, buddy.

Tell me you didn't print out a chart and scan it back in to post it....

You should be able to right-click most images and "save as"

For anything else:

Hit the "PrtSC" (print screen) button.

Open "Paint"

Hit CRTL-V to paste it into Paint.

Crop and save.

(please forgive me, if that's not the case)

[StychoKiller]

No, what he did was print out the chart, placed it on a wooden table, took a digital picture of it, uploaded it to his PC, then faxed it to his email address! :>D

[mark mchugh]

At least 30 seconds of hard laughter!

[prophet]

My new all-in-one has a shredder built-in.  Now I can shred those sensitive documents just as soon as they are printed.

[DocLogo]

and now in fancy, new colors

http://www.technologyreview.com/blog/arxiv/26007/?ref=rss

[ATG]

kewel

[StychoKiller]

cool indeed, but ya still can't eat it!  I'll stick with the recognizable yellow color, thanks. :>D

[RobotTrader]

Ted Butler must be looking at the silver chart today, totally aghast.

[tmosley]

No, I don't think so.  Are you sure you're actually a trader?  Have you ever actually paid attention to the markets?  Obviously not, because these types of moves are totally normal.  We're just not used to them recently what with all the thousands of factors converging to push silver irreversibly higher.

But seriously, learn about the PM market, or shut the fuck up.  Right now, you're just an ignorant twat when you talk about gold or silver.

[ATG]

No value added here

[tmosley]

You got that right.

May your dollars buy you everything you deserve.

[mrgneiss]

"No value added here"

Unlike your highly insightful first comment or other multiple one or two word comments.  Here's one word for you: hypocrisy.  Anyone who would attempt to compare the situation in 1980, where the US was a creditor and not a debtor (good luck raising rates this time), where in communist countries like Russia and China a single ounce of silver couldn't be bought, where Indians had about 1/50th of the disposable income as now, where silver was moved by a single family and not hedge funds, billionaires, and millions of middle class around the world who can no longer afford to buy gold and want to dump dollars - does not deserve a reply, but I had nothing else better to do after counting all the silver I bought today.

[EscapeKey]

I was quite happy with my holdings, but I might just have to order a few more coins.

Hopefully JPM will go down faster than Paris Hilton at the Music Awards.

[jomama]

Gold and Silver getting destroyed today... I wonder wtf is up...?

[ATG]

margin calls sugar

[DocLogo]

That's silly. Sugar doesn't even have a phone ;)

[goldsaver]

Jameson out my nose and on my screen is going to ruin it one day.

[moofph]

...considering the recent moves in the PMs, i'm still bullish on trollls...it's almost black friday perhaps the manipulators will take it to $9 - $11.

[MGA_1]

Probably in a pause for a little bit, but I think the fundamentals are awesome.

[ATG]

What fundamentals?

Silver commercials who know the most about silver are 5.1% Long and 32.1% Short

Speculators who can cut and run on a dime with higher margin requirements, are 18.5% Long and 2.4% Short

http://www.cftc.gov/dea/options/other_sof.htm

In sum, the makings of a perfect silver storm

[goldsaver]

Oh I'm so praying that you are right! Daddy needs more shinny! The lower it gets, the more I can afford!

[SloSquez]

http://www.youtube.com/watch?v=5vurBKy3h4c

http://www.sing365.com/music/lyric.nsf/Denial-lyrics-Sevendust/1A0B951758A3A836482568A9002EF206

[RobotTrader]

Oh, by the way.....

I wonder when some of these "world news" webcast interviewers are going to have the CEO's of Victoria's Secret, Pottery Barn, and Whole Foods as guests?

Note how investors in these stocks are completely  and totally unfazed by:

"Is China going to implode?"

"Inflation or deflation, which is it?"

"How much QE next time?  $500,000, or $3 trillion?"

"Are gold, silver and other commodities in a bubble or not?"

"Is Peak Oil true, or is it a myth?"

"Which way are the EUR/USD and AUD/USD pairs going to trade?"

................

None of those matter.

No wonder these stocks are now the "safe havens"...

LOL...

[ATG]

RT, your charts and pix speak for themselves and do not deserve junking by the jealous

http://stockcharts.com/charts/gallery.html?s=ltd 32 with 53 target

http://stockcharts.com/charts/gallery.html?s=wsm 36 with 59 target

http://stockcharts.com/charts/gallery.html?s=wfmi 47 with 75 target

[Bay of Pigs]

I see, now you're playing dinks with Robot, and all the PM's holders are completely wrong. Why not lick his balls while you're at it?

[Burnbright]

If you bought any of those stocks 3, 5, or even 10 years ago you either would of lost money or made nothing.

I don't think you understand what INVESTMENT means, or the fact that something that is STABLE in PRICE is a SAFE HAVEN.

[prophet]

11/13/2000 quotes:

LTD   26.94

WSM 8.75

WFMI 11.75

plus some dividends

[Burnbright]

Now adjust that for inflation.

[gwar5]

Leonard the monkey reports from the street that the customers buying overpriced veggies, cheap pots and fancy panties are all paying with silver bullion 

Give us company that sells discretionary items.

[Djirk]

Silver for photography has been dying for the last 5+ years and automobiles are not raging back yet, so I would say the price is not driven by fundamentals.

The value is driven by a belief of a further increase in value....what are the right words...oh yeah the greater fool.

I would say this is a trade at best and a good one so far! Stay alert and take some profits on the way up.

[tmosley]

I guess you never heard of the electronics or medical sectors.

[Shameful]

I was shopping for Tupperware (I pack my work lunches ok) and saw a set that claimed to use silver in it's construction to keep the food fresher.  Maybe gimmicky but looks like places are using it.  Hell bought a pair of sports shorts that claim it in their construction.

[Djirk]

would love to see the math

http://www.silverinstitute.org/supply_demand.php

OK so no current 2010 data and the market manipulation theory is not priced in. But check out demand compared to price/supply.

Notice the growing segment is coins and medals.

[tmosley]

You should also notice that demand has consistently exceeded supply.  This is the reason for the increase in investment.  People want to store silver for the supply squeeze that must come as we run down the world's inventory, a process that indeed has not been priced in due to market manipulation (hiding the brick wall you are barreling towards at full speed does not make it disappear, it just makes the eventual impact more painful).

The sudden discovery that the amount of silver available is actually 1/100th what it was claimed will blow up the price.  The discovery that there is ZERO silver, save that which made it into investor hands, will be like a planetary impact.

[mark mchugh]

Does anyone believe that roughly 20% of the world's silver supply comes from "Old silver scrap"

Anyone at all?

Because without it, fabrication outstrips supply every year.

[Chappaquiddick]

.

[1100-TACTICAL-12]

You Sir, Are a dumbass.. @ djirk

[mark mchugh]

Silver is the best electrical conductor (I own several devices that operate on this electricity stuff). 

You probably don't know this, but silver helped make that leisure suit you're wearing (cause who can afford cotton anymore?):

 Approximately 90 percent of the silver employed as an industrial catalyst (630 tons/year) is used for the production of ethylene oxide from ethylene. Ethylene oxide is the foundation for flexible plastics such as polyester textiles, used to make all types of clothing and a variety of specialty fabrics.

Those new-fangled solar panel thingies - silver.

Know that nasty MRSA thing that people keep getting while they're in the hospital?  Guess what you can treat that with (hint: not Methicilian).

[Djirk]

And SLV bought 523 tons in one week....

[mark mchugh]

That's like 16 million ounces.  SLV only claims to have about 340 million ounces total.

What week was that?

[minus dog]

I don't think there will be an increase in value - I think there won't be a precipitous drop in value in relation to stuff I actually want and need, compared to when I bought it.

There are all sorts of things I could use for that purpose; silver is simply easier to hide, store, and transport than most of them expect for gold.

[DoctoRx]

It's trading as money, Djirk.  Ignore "fundamentals" while money printing is the order of the day.

Poor person's gold and so on . . .

What I'm watching is if a PM correction is underway or it's a 1-2 day wonder, how much (if at all) will Ag underperform Au on the way down.  If Ag goes down rel to Au less than it went up, that would confirm for me that Ag is indeed the stronger asset.  16:1 again?

[Clint Liquor]

Silver solder replacing lead solder (EU mandate), Solar Panels, water purification, RFIDs, medical devices, antibacterial hospital products such as paint, linen, garments, etc., and there are many more. Products containing Silver have received more patents in the last ten years that all other metals combined, thanks to nano-technology.

Do some research, don't be a dumb-ass for your entire life.

[Djirk]

From 2000 to 2009 total silver demand dropped 3%, in the same period prices more than tripled.

I do not have the 2010 demand data, but I do not think demand has doubled like the price has so far this year.

Yet the silver ETF added 16.8 million ounces in one week. (approx to 2% of 09 total demand)

http://www.zerohedge.com/article/slv-etf-adds-massive-523-tonnes-silver-...

I am not saying that silver is a bad investment, I do not believe it is driven by industrial fundamentals.

feels frothy

[tmosley]

It's called an inelastic commodity.  The great increase in price only brought down the consumption by 3%.  Given that we are running down the last of the above ground stockpile now, you haven't seen anything yet.

But by all means, sell/short silver all you like.  I'll gladly take your purchasing power.

[Imminent Crucible]

"I am not saying that silver is a bad investment, I do not believe it is driven by industrial fundamentals."

So, the only legitimate demand for silver is "industrial applications" and maybe jewelry?  You reject investment demand as illegitimate?

Let me ask you a question:  Other than investment demand, what source of demand is there for stocks? U.S. Treasurys?  Other than investment demand, the only use for a stock certificate is to light a trash fire or a cheap cigar. Apart from investment demand, a U.S. Treasury bond is a very harsh form of toilet paper.

Your basic problem is just that you can't think.

[Djirk]

For the record, I am long (john) silver. I was just calling out that the price growth appears to be driven more by speculation/hedging, not growth in demand. Therefore requires a different more alert investment approach.

Non industrial demand ie more liquid demand can move price quicker both up and down.

baaah baaah baaaah

[Djirk]

what goes up......

http://66.38.218.33/scripts/hist_charts/yearly_graphs.plx

[Thunder Dome]

You can stick silver up your ass, too.

[Silverhog]

 If Gold is king, how come most folks buy Silver colored cars.

[tmosley]

Can't afford the gold paint.

[iota]

http://zedomax.com/blog/wp-content/uploads/2009/12/gold-plated-porsche-1...

That's why.

[notadouche]

Wow gold "plunges" to 1355.  Uh a couple of months ago the idea that it could breach 1300 was considered impossible and it's been a bubble since it broke 950.  It's kind of funny to watch the pundits smugly report how gold just isn't safe because it sells off so quickly.  Yet those same wonks turned their knows up at gold when it was at 850.  No bona fides to comment on gold IMHO.

[Segestan]

Are you kidding ?  The anti-gold hacks have went all in on containing metals. Just shows how stupid they really are. Instead of banking like a banker they trade like thieves.

[Clint Liquor]

Every 'Certified Financial Planner' will tell you that Silver is too volatile for investment.

They will recommend Cisco instead.

[nmewn]

LOL.

He shoots...he scores!

[lynnybee]

..... how i love this website, what a wealth of knowledge.   ....... even if you cannot afford much, just buy something, that is  the lesson i've learned here on ZEROHEDGE.    My lesson from all the wonderful writers was to just "accumulate, buy what you can, a little or a lot, just keep putting your savings every week into a silver eagle........... i followed your advice & am so happy ......... I now have accumulated for almost a year & have 300 pieces of silver bullion, eagle coins .......... DAMN BANKS !  THAT'S WHAT THEY GET FOR NOT PAYING ME INTEREST ON ACCOUNT !!!   I HAD TO GO TO THE BANK TODAY TO PUT SOME CASH IN MY ACCOUNT FOR BILL-PAYING & AS I WALKED OUT I LEANED OVER TO THE (very young & naive) BANK MANAGER, "Let me know when you pay interest again here at the bank & I'll stop buying silver & actually add to my savings account !! " ............. he looked dumbfounded & didn't even understand what the hell I was talking about .   

[Diogenes]

It used to surprise me how dumb bank employees are. But banks are notorious for their low pay scales so how smart could someone be with financial decisions, if they choose to work there?

[Anal Picnic]

Good buying opportunity

[Michael Victory]

agreed.

[Clint Liquor]

A+, lynnybee!

[JonNadler]

It's time to play

Name that moron!

Which moron said the following on April 1, 2009

Gold's Bluff - Is A 30 Percent Drop Next?
a. Me

b. Simon Maierhofer

c, Dennis Gartman  d. Peter Cohan  

[RoRoTrader]

Obviously not a. since Jon Nadler is not a moron. Probably not S Maierhofer either. It must be either D Gartman or P Cohan?

[JonNadler]

wrong, wrong and wrong, please try again and thanks for playing.

the winner gets a silver round with my picture on it aying "you can't eat silver" and in "Silver we DON'T trust"

On the reverse side is a picture of Jamie slaying the Silver Bull

[nmewn]

Jon...do you have a sister named Robo? ;-)

[JonNadler]

After what she's rumored to have done in Jamie's office, I want to forget she's my sister, believe me

[RoRoTrader]

No idea who said it, but did come across this CBC interview with DG from May 2008;

http://www.cbc.ca/money/story/2008/05/29/f-gartman-currencies.html

FL: You're long the Canadian dollar at the moment against the U.S. dollar. How long do you think that the Canadian dollar is going to trade above parity and why is it trading there?

DG: I think the Canadian dollar's going to trade above parity for many, many years into the future.

No one gets it right all of the time, but quite a call as the world was about to sail over the Niagra Falls financial crisis in a barrel........even I saw that coming.

I don't read DG or the others really, partly because I am so busy running my multinational private conglomerate when not trading currencies and commodities, and partly because I don't care.......

For informed opinions mostly I just read RobotTrader, ZH, Matt Carniol and a few others who generallly have sound and reliable analysis.

As far as the 'can't eat it' argument is concerned you can't eat paper or bullshit either, but you can slide a lot further on bullshit than gravel.

[JonNadler]

The correct answer is Simon Maierhofer

http://www.etfguide.com/research/150/8/Gold's-Bluff---Is-A-30-Percent-Drop-Next?/

[Diogenes]

You can't eat paper either but you can wipe your ass with it.

[RoRoTrader]

Yes, and everything has limitations. Put a match to it and try that.

[max2205]

Slv=Done

[Clint Liquor]

"From 2000 to 2009 total silver demand dropped 3%, in the same period prices more than tripled."

When demand exceeds supply, one of two things will happen. The supply will rise to meet demand or the price will rise to curb demand. ECON 101

[eigenvalue]

Well, demand can change with time. When people start to realise that the dollar is not the real money, you will see a huge increase of investment demand for silver, which will make the total demand to explode.

[DoctoRx]

+ $100/ounce target price

[eigenvalue]

Well, I believe $100 will be achieved. But the question is when? Hopefully that will be achieved by the end of next year.;)

[Oh regional Indian]

Just a small issue there Doc. What is the $ in the $100 trading at then?

It's this relative world, with so many variables, that makes this an almost moot discussion.

Ag and Au are post fiat investments.

Any talk of their $ price or Rupee price is fundamentally flawed.

PM's are value plays, not price plays. When time comes, you can and will be able to exchange them for something of equivalent value, price be damned.

ORI

http://aadivaahan.wordpress.com

[Chappaquiddick]

I'm hearin' ya' Clint - it's the insurance component, the longer term supply / demand characteristics and the scam side of silver that keeps me trading and investing Ag.  If the demand exceeds supply we get a commercial signal failure and we'll make some big bucks thanks to those crooks at JPMC.  If hyperinflation arrives then the insurance was needed and will work. However, looking passed all the doom and gloom - there is a long term component here - silver is finite - 8-10yrs is my investment time horizon - I just keep adding physical, it's that simple.  I trade the paper and invest in the physical.

[greenewave]

For more on the Corruption on Wall Street, watch the YouTube video Bankrupt Motors IPO, Hedge Fund Fraud at (http://youtu.be/JmrZikbC0zE).

The American public gets robbed, and we are supposed to be thankful??!!

Anonymous- 

47 seconds ago

Great upload cgreen34, the best fictional writer in the world couldn't even make this nonsense? up. Makes me sick.

[lynnybee]

i watched it, that guy is good; he's right on.   american's are getting the shaft bigtime........WHERE'S THE REVOLUTION, PEOPLE!!!   HOW MUCH MORE ARE WE GOING TO TAKE ?!

[robertocarlos]

Do you know where I can buy physical gold on margin?

[tmosley]

APMEX accepts payment via credit card.  If you can muster the credit line, that's basically infinite leverage, though the carryng cost might be pretty high.  All depends on your credit.

[robertocarlos]

Thanks. RBC just gave me a 10k line of credit and I have 23K of room on another CC. The interest rate is 7 percent. I could get wiped out though as I can't support that much debt. Banks are insane. 

[rocker]

You can also go the the post office and send Apmex a money order. To save the 3% credit card fee.  If you keep it under 3K the P.O. does not have to report it to Homeland and the IRS.  If you buy a once of gold, and something else, Silver, Platinum, or Palladium every week it cost averages and keeps it all pretty clean.  Works for me. Simple and Easy. 

[prophet]

Scarcity is a fallacy and turns people against one another. 

I've said it before and I'll say it again.

[Clint Liquor]

Of course! There always was, and always will be, an abundance of everything.

And Unicorns shit Skittles.

[dehdhed]

buy gold and silver and pray it never goes up.  if you want to play the price swings then  do it with the gld and slv, but for christ's sake don't buy the physical hoping to make a fortune on it.  it's insurance.   who buys insurance hoping they get to use it someday? buy only what you think you will never ever need to sell. like a college fund, think of it as an inheritance fund for your heirs.

just ask youself if you feel like you have enough already and if not, then go buy a little more.   when the price is high like it is now you'll probably feel like you've got too much already. 

but whatever you buy, do it thinking you hope you'll never have to sell it.    the only time you'd hope to use it is when this freaking fiat monster world we live in crashes and then it becomes money again.   i mean who sells money now?   nobody but the people buying gold and silver.   so why would you sell gold.   if you have to sell gold then you bought too much.   just make sure you got some gold and silver and don't hope you get to 'sell' it for a profit later.  

if they ever do a currency conversion later here's how it will go.   they'll say okay we'll give you 1 sdr for every 10 dollars of your worthless currency. before the conversion gold might be $1500/oz but now it's 150sdr's/oz. then they revalue gold where it should be like 10,000 sdr's/oz and they just stole all your wealth and made everyone poor poor pitiful slaves.   but if you already had gold and silver you'd still have the value and probably more  because then it would be valued realistically and not fictionally like it is today.

the gld and slv won't work for this because they'll reveal the scam that it is ... just a diversion for the demand of physical until they have time for their plans to take place. even if those etf's have some physical, they just steal it and say oh guess what, you should have read the prospectus.  or here's your 150sdr's/oz.  and that's how the next confiscation will take place.

and if you can't afford to even buy silver and never sell it, then go tell all the people you know who can afford it to buy some.  at least later on you'll know someone who made it through.   it's like not buying lottery tickets but hoping somone you know wins the lottery.

the golden rule: he who has the gold rules

[i-dog]

Some interesting calculations in PM context:

China's trade surplus (~$20 billion/month) could buy:

• 24,000 tonnes Silver/month
• 450 tonnes Gold/month

US Budget Deficit (~$1.4 trillion/year) would require selling:

• 140,000,000 tonnes Silver/month
• 2,600,000 tonnes Gold/month

[Chappaquiddick]

Anyone happen to have a pdf of this lying around that they're willing to share?

http://store.cpmgroup.com/ltslv0501.html

[dehdhed]

my guess is that if they think the report is worth $7500 then it contains information for a tremendous wealth generating  opportunity.  when you view the table of contents in the sample summary, i doesn't take much to imagine what the report contains.   especially the last section with all those countries future fabrication demand.

[rocker]

Right On Dehdhed. Sounds like they see value. Put the $7500 in Silver instead.

[Chappaquiddick]

Dear God  - with responses like this is it any wonder the world is soooooooooooo fucked up.

Asshole#1 - Duh the report is worth a lot so it must have valuable info in it (!)

Asshole#2 - Yeah dude - we don't need that just buy silver (!!)

That's how to make an informed investment decision.

Please you two - go outside and fucking throw yourselves under the wheels of bus - do us all a favour ======> Fuck off and die!!!!!!!!

[dehdhed]

class act there brother.

what the world definitely doesn't need is more of this pot calling the kettle black routine

[Chappaquiddick]

You've redeemed yourself AH#1.

[Chappaquiddick]

What is the ZH community best guess at the size of the current World Silver Reserve Base  [Reserve Base.—That part of an identified resource that meets specified minimum physical and chemical criteria related to current mining and production practices, including those for grade, quality, thickness, and depth. The reserve base is the in-place demonstrated (measured plus indicated) resource from which reserves are estimated. It may encompass those parts of the resources that have a reasonable potential for becoming economically available within planning horizons beyond those that assume proven technology and current economics. The reserve base includes those resources that are currently economic (reserves), marginally economic (marginal reserves), and some of those that are currently subeconomic (subeconomic resources)].

[dehdhed]

380,000 tons  about 12 billion oz

http://minerals.usgs.gov/minerals/pubs/commodity/silver/mcs-2010-silve.pdf

[Chappaquiddick]

620,000 tons (current) [that's about 18 billion oz] up from 540,000 tons (2002-2004) (USGS)

C'mon folks if you have data on this post it up - lets get a full picture and see if this is hype and tripe or the real deal.

[Chappaquiddick]

What is the ZH community best guess at the size of the current World Silver Fabrication demand.

[Chappaquiddick]

What is the ZH community best guess at the size of the current World Silver Investment demand. 

[dehdhed]

28,000 tons/year for all categories of demand .. 900 million oz

readily available mining reserves should be nearly depleted in about 15 years at the rate we're going .. i guess

http://www.silverinstitute.org/supply_demand.php#supply

[Chappaquiddick]

There is a reason to count these separately - investment silver is not consumed and could be recycled in the future.  It represents the physical transposition of reserve base into above ground silver.  At some point all the silver will have been extracted and what's left at that point will be what's on the surface.

[Chappaquiddick]

What is the ZH community best guess at the size of the current World Silver supply - all sources including recycling.

[dehdhed]

25,000 tons/yr  about 800 million oz

[Chappaquiddick]

Your source quotes 889MMOz.

[dehdhed]

ah yes it does ...thanks

for that i was just guessing using usgs 2009 mining data of 21,000 tons and figured recycling would put it about 25,000.

one final guess is i think someday silver could be more valuable than gold and whether it's $30 or $20 now, in retrospect it will look like today it's almost free.

[Chappaquiddick]

It depends entirely on the rapidity of our collective descent.

[Chappaquiddick]

850MMOz rising to 965MMOz by 2014:  which means taking my reserve base estimate that we have 20yrs to total reserve exhaustion if current and projected extraction rates continue and even allowing for a 10% reserve base expansion due to price improvement.

20 years to COMPLETE RESERVE BASE EXHAUSTION.

Does anyone have anything to add here - can you contribute to this data set?  Thanks