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Physical Silver Update

Tyler Durden's picture


And meanwhile, the repulsion to silver as exhibited by both the Comex (where as we predicted yesterday we see the first 32MM ounce handle in registered silver - a new record low), and Scotia Mocatta indicates that the silver paper and physical markets are in perfect unison. Or not.  But yes, the feedback loop mechanism of SLV unwinds will likely have a greater impact on the paper market until such time as it once again reverses and aligns paper and physical interests yet again.


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Fri, 05/06/2011 - 17:36 | 1249323 Tinfoil Hat
Tinfoil Hat's picture

Silver, bitchez?

Fri, 05/06/2011 - 17:46 | 1249379 tmosley
tmosley's picture

Out of silver, bitchez.

Fri, 05/06/2011 - 17:53 | 1249394 buck4free
buck4free's picture

We will buy anything you have for 3 over spot, bitchez.

Fri, 05/06/2011 - 18:22 | 1249512 AR15AU
AR15AU's picture

Silver @ 35.85

APMEX selling ASEs for $43.  WTF


Fri, 05/06/2011 - 18:41 | 1249555 Tinfoil Hat
Tinfoil Hat's picture


$42 here, yuk.  NTR bars arent too terribly priced though.

Sat, 05/07/2011 - 01:42 | 1250488 Transformer
Transformer's picture

It's called supply and demand.  The very first thing they teach you at business school.  We do not need slick New York con men in $2000 suits telling us what silver should sell for.  Let them play their paper games with each other.  Let them fuck each other over as much as they want.  we are the physical silver market and the price here is uncoupling from Comex spot price.  It's happening all over the market right now!!!  In two to three weeks there will be a physical silver price and a paper spot price for con artists.  Take your pick.

Sat, 05/07/2011 - 12:12 | 1251006 gmrpeabody
gmrpeabody's picture

I'm down to my last silver dollar...

Sun, 05/08/2011 - 01:58 | 1252437 eisley79
eisley79's picture



I love zero hedge, but I have to say.  I am Canadian, and buy my silver from scotiamocatta.  All the things in that picture have been sold out for a long time, and before the latest part of the big surge.

They still have Candian Maples, which is the only thing I buy, these other ones sold out quick because they have a smaller margin over spot (but are also lower quality products).

These being sold out has nothing to do with their invetory changes, COMEX, or the latest crash, and a lot more to do with the strong interest in silver since Jan/Feb. 


They have been routinely sold out of everything small sized, except maples, which have been in stock since february, including currently




But the 1 kgs were in stock when I bought 2 pounds of maples, friday at 9am.  (cause i considered buying one instead).  So that is new :)


Double Edit***

Now I went on to check :D, the 5oz scotiabank garbo-coin is back in stock, and of course, they have never run out of maples yet.  The other smalls have been sold out for at least a month.  The 1kgs sold out friday, sometime after i purchased before leaving for work. (hit the current bottom almost to the minute, #winning, if it dips again, might go back for some more)

Sat, 05/07/2011 - 12:46 | 1251088 DosZap
DosZap's picture

These are simply PREMIUMS that these folks are trying to get you to pay.

LOOK around,when the mkt closed yesterday I could get them under $40.00.(won't be the case Mon, as the prices of Slvr will be going right back up, as they are already doing).There's your Supply & Demand.

So what does that tell you.

IF your willing to pay Excessive Prems, then they will gladly take your FRN's. 

LOOK AROUND,every $2-$4.00 you save, is more metals for you.And a lower cost  basis.

Fri, 05/06/2011 - 18:42 | 1249570 flacon
flacon's picture

Two tier pricing - one the "manipulated market price", the other the "free market price". If you want the real stuff you have to settle for free market price. LOL! It's amazing to see how the free market ALWAYS finds it's place. They can't stop the free market.

Fri, 05/06/2011 - 19:11 | 1249627 66Sexy
66Sexy's picture

As predicted. Lower prices will bring the shortages, not higher ones. And increases the likelihood physical holders will hold tight at the previous highs.

Fri, 05/06/2011 - 20:02 | 1249816 Hacked Economy
Hacked Economy's picture

Agreed.  That's why price-and-wage controls, for example, never truly work.

After all, how many of us are buying **more** physical now at $35 than when it was at $49 a week ago?  I was hesitant back then, but now I'm loadin' up.  Proves 66Sexy's theory above.

Let the Crimex celebrate their touchdown for now, but buy physical and hold.  Remember that when the fiat goes splat (I expect a severe event by 2013, IMHO), it won't be how much fiat you hold, but how many ounces.

I'm not a big institutional buyer (I'm just a regular Joe), but I'm buyin' all the same!

Fri, 05/06/2011 - 23:51 | 1250356 LowProfile
LowProfile's picture


Plenty of silver at APMEX $1.79 over spot and up

You guys aren't helping things with this BS, and that includes Durden.

Sat, 05/07/2011 - 00:44 | 1250430 6_7_42
6_7_42's picture

>$3.50 over spot = 10% premium the ad is "as low as" meaning if you buy in bulk; also the minted coins run much higher than rounds.

Sat, 05/07/2011 - 12:49 | 1251099 DosZap
DosZap's picture


Yup, I hate the 4 tiered crap.

But, their company, and they seem to do well.

Sat, 05/07/2011 - 01:54 | 1250495 Transformer
Transformer's picture

So, you think that the market should be controlled by New York crooks in fancy suits?  Get a grip man.  If the physical market makes its own price, where do you think that price is gonna be, lower than spot?   LMAO

In the market place, price is determined by supply and demand.  NOT by con men who manipulate the market, and own the regulators.  We are so many and create so much demand, there is absolutely nothing they can do.  This last whack job is backfiring on them.  As a result of what they have done this past week, they will completely lose control of the physical market.  Comex spot price will be a joke.

Sat, 05/07/2011 - 15:51 | 1251322 DosZap
DosZap's picture

Trans, you talking to me?.

I wish folks here would have the courtesy of putting the initals, or the first name at the top of their responses to posts.

Otherwise HOW does one tell, or respond in a logical manner.

Drives me batty.

IF you were responding to me, NO.

They are free to set whatever premiums they wish, evidently there are plenty of suckers and fools that will pay double.

More power to em', the Capitalistic system at work.

Sat, 05/07/2011 - 17:20 | 1251521 Transformer
Transformer's picture


Hi, I'm fairly new here.  I guess you're right, I need to say who I'm talking to.  What seems to happen is that a lot of other posters fill in the threads and then you can't tell who the post was directed at, sorry

Sat, 05/07/2011 - 17:36 | 1251540 akak
akak's picture

Transformer, that is why I ALWAYS quote the person to whom I am responding (you know, using that little blue <"> icon in the tool bar of every comment box) --- not just for clarity of discussion, but because sometimes the original quote, if from a particularly reviled, disingenuous or dishonest poster, may be junked right into oblivion, clouding subsequent non-quoted responses even further.  I wish everyone here would quote others when responding to them.

Sat, 05/07/2011 - 12:10 | 1250987 Hacked Economy
Hacked Economy's picture

@ LowProfile,

Please explain what you mean by "BS".  If you're only looking at PMs as a market-traded commodity to get more FRNs, then all the best to you, because if you're really good at it, you might certainly get more FRNs for your trouble.  But at some point, the fiat house of cards will come down. 

Fiat is obviously useful in everyday life, but its value diminishes every day (as we all know).  Having some PM will not save one from all ills, and we don't purport to say that here on ZH, but it's vastly superior to fiat and will be convertable in any economy.

So....once again...explain what the "BS" is.

Fri, 05/06/2011 - 21:34 | 1250055 Texas Gunslinger
Texas Gunslinger's picture

Again, I admit I don't know as much about the silver market as most investors here, but I do have a few comments and questions.

Why is there so much focus on the "paper" price of silver as it goes up, but when silver goes down, suddenly the "paper" price becomes meaningless?  It kinda sounds like people lying to themselves or being willfully ignorant.    

If the great fiat apocalypse happens soon, and silver is agreed upon by the plutocrats and sheeple to become the next currency, I can understand why today's fiat price doesn't matter.

Yet, if the fiat apocalypse doesn't happen soon (which I'm inclined to believe it won't), then I don't understand why the downside "paper" price movements are meaningless. The entire world is a "paper" economy - everything in commerce is measured and resolved with "paper."  And while its fun to idealize a retro-world where precious metals are mediums of exchange, it simply isn't reality.  Goods and services are still exchanged for paper, everywhere.

So if it's not a medium of exchange, is it a storage of wealth?  Yes, indeed it is. But is it better than many other options?  Maybe, but not really. I could pick the biggest "sheeple" stock on Earth - Apple - and it's been a better storage of wealth than silver in the past 2 years, and more broadly, this past decade.

I guess that's a long-winded attempt to say that I don't understand all the silver worshipping.  As a storage of wealth, silver is just one option among many, and after the slaughter it encountered this week, it doesn't necessarily seem like a standout, nor worthy of worship status. It's just as vulnerable to manipulation and bullshit (on the upside and downside) as anything else. 

In your mind, the value of silver may be supernatural and transcend various fiat measuring sticks, but to the rest the world, silver only functions within the sphere of paper denominations.

Either you can attempt to function and invest in the real world (as unfair as it is), or you can drift off into the goofy land of cults and conspiracies and carnival-barkers.     



Fri, 05/06/2011 - 22:32 | 1250221 blunderdog
blunderdog's picture

What does "price" mean if it doesn't mean you can acquire something for that amount of money?

What does "value" mean?


Sat, 05/07/2011 - 07:51 | 1250656 goldfreak
goldfreak's picture

texasmudslinger,  I thought you were supposed to be a Christian, yet you used the word 'bullshit' in your post.

Now trolls claim to be Christian to lend credibility to their troll, shill propaganda?

Jon Nadler would be proud

Sat, 05/07/2011 - 12:27 | 1251045 Hacked Economy
Hacked Economy's picture

There are Christians who follow James 3:10 ("...out of the same mouth comes praise and cursing...this should not be..."), and there are others such as Dog the Bounty Hunter (of TV fame) who openly claim to follow Christ but constantly use foul and demeaning language.  That second group believes that Jesus has saved them from all their sins - both past and future - so they can therefore get away with anything they want.

Sat, 05/07/2011 - 14:08 | 1251219 bonddude
bonddude's picture

Those who are true believers generally keep their mouths shut and serve ... otherwise carnival 


Sat, 05/07/2011 - 07:54 | 1250657 goldfreak
goldfreak's picture

texasmudslinger,  I thought you were supposed to be a Christian, yet you used the word 'bullshit' in your post.

Now trolls claim to be Christian to lend credibility to their troll, shill propaganda?

Jon Nadler would be proud

Fri, 05/06/2011 - 22:33 | 1250229 goldsaver
goldsaver's picture

I'll take a stab at it since you are a fellow Texan and you are been courteous in your questions. The reason that the paper price is critical when is going up but not when is going down is because the paper price going up drives the physical price going up. But, the paper price going down, although initially drives the physical price down, it also dries up the available supply driving premiums for the available physical back up.

So, as a practical example. When the paper price was at 46 the physical price went up to 46 (and a small premium). Now that the paper price is back down to 35, the suppliers are running out of deliverable silver. This causes the dealers to increase the premiums to reduce the demand. So you see the disconnect. If the lower paper price was truly dictated the by a lack buyers, the dealers would not be running out of physical silver now. But because is all paper games, all it accomplishes is spooking the paper holders and making it harder for the physical holders to BTFD.

To be honest, I enjoy the paper games. It lets me get more shinny for my paper tokens.

Fri, 05/06/2011 - 22:51 | 1250252 Bob Sacamano
Bob Sacamano's picture

Willing to bet the premiums normalize within the next 30 days to the extent they have widened materially.  Tulving has Maple Leafs at $2.69 over spot -- not sure, but I think it usually is $2.29 or something.   Regardless, don't think the wider premiums have compensated for hardly any of the spot price decline from $50 to $38. 

But I am with you - my paper silver profits (both long and short) have paid for all of my physical silver holdings -- so I own a fair amount of physical silver at no effective cost.

Fri, 05/06/2011 - 22:38 | 1250233 dogbreath
dogbreath's picture

Silver euphoria for 1000 alex.


When the price is up all the physical bugs are excited because their belief in the failure of fiat is being validated and their wealth is being preserved. 

When the paper price goes down they are glad they have physical and not paper.  peeks under the matress  " phew  still there".






Fri, 05/06/2011 - 22:37 | 1250239 Bob Sacamano
Bob Sacamano's picture

Your logic is on point.  Most on this site have a blinding bias and certainty that the only appropriate investment is physical precious metals -- no matter your investment / trading time line or objective.  And you may only be long PMs at all times - thou shall never short PMs.  Any other investments that may have made you money are illegitimate, only result from market distortions / malfunctions (conspiracies abound) and you are deluded if you count those fiat "profits."

I own my share of physical precious metals, and made very good money long paper silver during the ten days up until Easter Monday morning. But I have never made so much in any year on one investment as I have the last ten days shorting paper silver -- wow. 

Many on this site seem to make no distinction of trading for the short run (1-180 days) and making multi-year investments.  Presumably because they have bet all they have that the apocalypse is next week.

Sat, 05/07/2011 - 20:42 | 1251869 chamaflauge
chamaflauge's picture

Agreed. Few ever notice the black swan

Fri, 05/06/2011 - 23:39 | 1250336 nomadhotel
nomadhotel's picture

Commodities markets appear uniform when all you look at is the charts. Contracts for commodities are purchased at exchange prices, so it seems reasonable that the to-the-minute price would correspond to the actual value of the commodity. What you must understand, and you need this at the level of reflex, is that the market value of a commodity is not the immediate value. Buyers who require immediate settlement and delivery will pay a different price than the market spot. The primary determinant of that difference is how well the physical market is coupled to the futures, or paper market. The silver market, for instance, is decoupling from the paper market, so while the prices for silver contracts are falling, the prices for physical silver have changed little in the past week. When the paper market is completely decoupled from the physical market, the paper market will simply disappear, as it will have no value.

If this seems unlikely to you, consider a silver contract and a Federal Reserve Note. A silver contract, purchased at one price during a market day, promises to deliver 5,000oz of silver to the bearer upon settlement. A silver contract has a goal, a terminus, an exchange of physical silver for currency. The Federal Reserve Note on the other hand is semiotic device, whose value is measured in the words, "Backed by the Full Faith and Credit of the United States Government". These semiotic devices are accepted as settlement by employees for work performed, by merchants in exchange for goods, and by traders for settlement of contracts. If a merchant ceased accepting them in exchange, if a trader refused them for settlement, they would lose value to the bearer, because they have no inherent value. Likewise, when silver contracts fail to deliver silver, or the owners of silver lose money on futures and only execute immediate settlements, the futures market crumbles. A silver contract has inherent value so long as the bearer can trust that the counter-party will deliver physical silver. If they cannot deilver, it's just a piece of paper with no more inherent value than a Federal Reserve Note.

The worship of silver you seem to deride is fully justified. Since the FRN has no inherent value, only functioning as a semiotic device, and the bulk of international settlements occur in Federal Reserve Notes, persons educated about this are conventionally frightened of investing their wealth entirely in intangibles that are valued only in FRNs. The only ways to measure the value of the FRN are to view the ledgers of the issuing bank, and to read the exchanges of FRNs with other fiat currencies, since again, the FRN has no inherent value. While the books of the Federal Reserve are not open to mere mortals, we have a dim notion of the magnitude of debt that they and the United States Treasury have generated in the form of the Daily Treasury Statement,, and as of 05 May 2011, the total public debt subject to the debt limit (Table III-c) is $14,269,975,000,000. This should cause cardiac fibrilation and explosive defecation to anyone with significant weath denominated only in FRNs. Yet the bulk of investors treat this absurdity as normal, if not necessary to market function. It does not occur to most investors, or the public for that matter, that bearers of FRNs are gambling that the semiotic game being played where the pretense is that the FRN has actual inherent value will not end suddenly, with a mass epiphany that the "Full Faith and Credit of the United States Government" is not a rational place to store wealth.

Silver, like gold, has inherent value. It has had aesthetic value for age. The modern industrial and commercial applications for silver grow daily. So one one hand it is a commodity for consumption. On the other, it is a store of value, and has been used from antiquity until the late 20th century as a medium of exchange. Silver bullion filled that role very well because of some important characteristics. Silver is durable, in the sense that silver bullion will not undergo physical or chemical changes in conventional usage. Silver is portable; land has inherent value too, but is not portable, lending land to be called a solid asset, and bullion a more liquid one. Silver is fungible, meaning that it is well suited for substitution with other quantities of a different commodity. Silver cannot be counterfeited; a government cannot counterfeit silver bullion as they can a fiat currency, they would have to resort to literal debasement as the Romans had done. A free market will reject a debased metal currency out of hand, or revalue it to reflect its' actual metal content.

To rejoin your comment, the volatility of the paper price of silver is important to a physical silver investor when the paper and physical markets are well coupled, and the physical investor can take on some risk and buy contracts for future delivery instead of settling immediately. When the markets become decoupled, the paper market can become irrelevant. The fundamentals of silver are not dependent on the paper market itself, but the paper market can influence the production and consumption rates of silver through corrections. In a truly free market, the exchanges would stabilize would help to flatten volatility in prices and stabilize production rates. In the interventionist market we operate in, the exchanges tend to serve at the pleasure of large investing institutions and central banks, who are completely vested in the idea and practice of semiotic fiat currencies rather than a currency with inherent value. The FRN is an actual confidence game, whereby its' value is in direct proportion to the confidence that bearers, or those looking to be bearers, have in the "Full Faith and Credit of the United States Government." Silver, along with gold and other physical commodities, is a place to store wealth. That silver can be valued in FRNs is irrelevant, as silver has inherent value. That anyone would accept FRNs in exchange for silver should be regarded as nothing short of a miraculous leap forward in neuroscience, exchanging an object with actual inherent value for another with no inherent value.

Your argument of AAPL being a better store of weath than silver requires some testing. Your challenge is to find an AAPL shareholder who is willing to denominate their shares in terms of a commodity. In other words, this investor needs to declare their shares to be fungible, and determine what they would exchange them for. I don't expect success, because Apple does not pay dividends. Looking at Apple's revenue and earnings per share,, I see the traded value of the shares going up, I see significant increases in EPS, but year after year of zero dividends. Anyone who is not a major shareholder is not holding a fungible asset. It generates no returns. The only recourse to a shareholder who wants to profit from their shares in AAPL is to sell some or all, otherwise the value is entirely notional. When the stock exchanges will accept commodities for settlement of trades (or commodity backed currencies), stocks will normalize and can then be considered fungible and true stores of value.

Investing in real commodities is a version of Pascal's Wager: the physical commodity investor has nothing to lose and everything to gain; at the end of the exchange, the investor has acquired a real asset and disposed of a notional one. That the real asset can be denominated in terms of the notional or semiotic one is irrelevant as the commodity has inherent value.

I have been working under the assumption that you aren't trolling. If you are, I enjoyed typing this anyway. Apologies to the market pros reading this; any errors in terminology or concepts are due to my embryonic stage of investment experience.

Sat, 05/07/2011 - 00:19 | 1250390 Texas Gunslinger
Texas Gunslinger's picture

Holy Bob Saget!

You win.

That was a very well written, very informative and generally an outstanding response, which I did not expect! 

Give me some time to let your post sink in while I smoke this cigar and drink my Spaten.

If I can't put together an honorable response tonight, I fully concede you won.

Much respect.....


Sat, 05/07/2011 - 11:36 | 1250902 fiftybagger
fiftybagger's picture

Nice try troll.  You've been outed.  And yes there are some Christians on this board, and we knew you were a phony one from the very beginning.  Try again Spock...


Silver For The People

Sat, 05/07/2011 - 12:08 | 1250974 Texas Gunslinger
Texas Gunslinger's picture


Sorry about the delayed response.  

Of all the things I'd like to comment on, I'd like to single out a particular sentence of yours, which I think bears the most interesting conflicts:

A silver contract has inherent value so long as the bearer can trust that the counter-party will deliver physical silver. If they cannot deilver, it's just a piece of paper with no more inherent value than a Federal Reserve Note.

And therein lies the truth! If there has been a single, prevailing (fictional!) theme during this most recent parabolic run in silver, it has been an assertion that the Comex might default on its ability to deliver physical silver.  We heard it from everywhere - all the silver bugs, blogs, and even the largest players in the market like Sprott. Supposedly, there was NO silver, or at least not enough right around the time Sprott was launching his ETF (how convenient!).  Returning to your comment, if there truly was a fear that the Comex would default, why were contracts bid so high in the first place?  You claim that paper contracts will move inversely to physical if the contracts can't be honored, yet that's not what happened in the past nine months when the fear of Comex default was being spread by carnival barkers everywhere. If the fear of Comex default was real, then the promissory notes representing silver were as semiotic as a FRN, yet that potentially worthless contract was simultaneously being bid to the moon. Thus, it begs the question: was the fear of Comex default a fear-mongering sham? Please add some clarity to this if you can because the rumors of Comex default clearly didn't match the stratospheric bid on its paper promissory notes.

If all this noise about paper versus physical were true, it should have played out differently on the way to $50.  The fact is, though, paper prices and physical prices moved in virtual lockstep with one another even through the deep fictional fog of Comex default being spewed by all the silver pumpers.  Shouldn't the opposite have happened?  Shouldn't paper prices have drifted toward zero if the Comex was truly about to default? I think your comment referenced above has more truth than the silver bugs would like to know.  

You place no faith in semiotic instruments.  I do (to a point).  And so does the rest of the world, even those people buying silver through the Comex or those people exchanging ~$4T worth of foreign currencies each day.  While your argument against semiotic financial instruments is a sensible one, it is too often taken to maniacal extremes and looses all reality. You have two choices: you can plan for the apocalypse or you can focus on your retirement. I focus on the latter.  And I spend a reasonable amount of time hedging myself against a dollar which, I acknowledge, will grind lower over time.  But I stop short of taking that leap into the land of gloom/doom, apocalypse and conspiracy.  Even though the FRN is not backed by gold/silver, it is ultimately backed by the American military and the productive capacity of the American economy.  Say what you want about the American economy, but for all of its faults, it remains the most vibrant and resilient in the world. $14T in debt is alarming, but it's not a death sentence for the same reason that an American worker who makes $75K/year is not bankrupt even though he owes $300K on his house.    

But let's return to the original topic at hand:  paper versus physical in the silver market, and distinguishing fact from fiction.  Why were Comex promissory notes being bid to the moon if the threat of Comex default was real?  And what does this say about the supposed distinction between paper and physical? If the distinction between paper and physical is truly real, and this week's blowup in the market was just a "paper" phenomenon, would I be able to sell my physical today for anywhere near the physical price 7 days ago? 4 days ago?  Would someone pay me over $40/oz?

And with regard to the supposed physical shortage and Sprott's supposed inability to get enough physical for his ETF, did he purposely ladder his buying of silver futures in a deliberate and delayed way, so that he could claim it took several weeks to get delivery, even though that is exactly how delivery on a futures contract works?  Just curious, because I really don't know, and it appears he was just creating hysteria for those narrowly focused on paper versus physical.   


Thanks in advance for a meaningful discussion....


Sat, 05/07/2011 - 16:07 | 1251316 akak
akak's picture


It is certainly interesting to note how you entered this forum less than two weeks ago claiming to be a rank newcomer to silver, and demonstrating a less-than-sophisticated demeanor and knowledge of the silver market, only to end up posting such an erudite and highly detailed comment as this one in such short order.  I mean WOW, that learning curve of yours has been even much more vastly steeper than silver's recent parabolic rise!

Sat, 05/07/2011 - 19:23 | 1251718 Stormdancer
Stormdancer's picture

I see I'm not the only one that noticed :)  He's a caricature on several levels...and not a very good one.

Sat, 05/07/2011 - 00:23 | 1250395 AgShaman
AgShaman's picture

Hahahaha.........."I'm merely trying to free your mind Neo"  *Morpheus

Thanks for your time and energies putting that together rather nicely....much appreciated!

Paging US Uncut...are you out there lurking somewhere?

Please return and read nomadhotel's post.

Sat, 05/07/2011 - 09:21 | 1250725 instinctiveDrift
instinctiveDrift's picture


Great post!

Sat, 05/07/2011 - 09:28 | 1250728 Bob Sacamano
Bob Sacamano's picture

Guess I do not buy the premise that "prices for physical silver have changed little in the past week" and that there has been a major decoupling in paper and physical silver.  If that is the case, I am looking to sell some at $50 today.

EBay or the little dealer down the street is not the appropriate physical pricing source.  A respected dealer of size (like Tulving) is selling physical silver at spot + a premium that is little changed over the past months.  Paper silver is tracking spot prices fairly consistently. 

Sat, 05/07/2011 - 11:02 | 1250840 Manthong
Manthong's picture

Very well put, thanks for the effort.

"the total public debt subject to the debt limit (Table III-c) is $14,269,975,000,000. This should cause cardiac fibrilation and explosive defecation to anyone with significant wealth denominated only in FRNs."

It sure did for Nelson Bunker Hunt. He was right and had a good plan for preserving wealth and arbing a reconciliation. The system, however would not stand for it.

I know how the system is trying to react to a Hunt brothers redux, but I wonder how it will work out now that the reconciliation is being conducted by a minority of the populace rather than an off-beat conservative thinking billionaire. 

Maybe I am a bit cynical, but I see villification in the offing. 

Sat, 05/07/2011 - 18:09 | 1251605 Transformer
Transformer's picture


  I sure see what's happening now as having multiple parallels and similarities to what  happened in 1980 with Bunker Hunt.  He decided to corner the physical silver market because of inflation fears, and proceded to amass well over 100 million ounces of physical silver stored at various locations around the world, all of it free and clear.  He got embroiled with the Commodity exchanges and they always win, because they make the rules and have the ultimate rule maker on their side, the US government.  His plan was working, he got taken down because he had lots of futures contracts, and there was that same short side interest that there is today.  They naked shorted the market and he lost.

What is happening right now is so similar as to be eerie.  An entity is buying up all the physical silver it can get, for the same reasons that Bunker was doing it.  That entity has amassed a huge unknown amount of silver, but certainly, at least twice as much as Bunker did.  The difference is that this entity is not in the commodities market and therefore un touchable by those same short interests.  The entity, of course, is millions of individuals from all walks of life, the public.

This action has turned the physical market into a huge Gorilla.  The commodities market pales in comparison as far as actual physical silver delivered to buyers is concerned.  This physical market has stayed pretty much in lockstep with the paper market as regards price, but due to abuses and corruption in the paper market, the physical is breaking away from the paper market, which has always determined price discovery. Now that all players see the blatant corruption in the paper market, a new price discovery mechanism will assert itself. 

A similar parallel can be drawn about the price of gold as recently as a year ago.  Gold seemed to track almost exactly the inverse price of the dollar.  This continued until the market realized that the dollar was finished and that any upwards movements of the dollar were simply aberrations brought about by currency swaps, bond failures around the world and other factors.  The fate of the dollar is sealed and this is now known by all the players, so the gold price broke away and now moves completely independently of the dollar.  In one sense, this is strictly not true, as gold is going up because the dollar is going down, but no one is fooled anymore by temporary moves to the upside of the dollar, no matter how well it is talked up by the FED or the idiots on CNBC.

Like wise, we have just arrived at the point where no one will be fooled by the Comex price of silver any more.  After the display put on this past week at the Comex, we all get it.  And remember, we don't have commodities contracts, so the exchange can't naked short us to death.  We frankly don't care.  As long as the Comex pricing mechanism holds up, it will act to only further bring about this change, as manipulated lower prices for silver will bring about greatly increased buying on the part of the public, increasing the shortage.  The Comex traders engineer this big whack job to push silver lower to stop this advance and it has no effect.  The public sees it as "Silver on sale" and they just buy more.  The Comex con artists can have no affect on what's happening, almost by definition.  The public buys silver for the same reason Bunker did, only we're not on margin. 

As witness, what happens?  The Comex brings the price down.  The public watches but does not sell its physical.  When it looks like the price has bottomed, the public jumps in and buys all the physical it can get, until the dealers are out of stock and back ordered for six weeks.  This just increases all the fundamental pressures that were driving silver to the upside.  Blythe and company ulitmately achieve, with their short sighted manipulation, the opposite of what they are trying to accomplish.

So, I say to those manipulative forces that are trying to stop us, go ahead, keep it up.  The pricing mechanism is going to change now, and whatever you do just drives the price higher anyway.


Sat, 05/07/2011 - 12:37 | 1251070 kumquatsunite
kumquatsunite's picture

y The only reason anyone waxes so gloriously grievously regarding Ag is to assist the market; elevator down anyone? Sure, when the price pops around a lot in a short period of time "the masses" become a bit more interested and allow themselves to be fleeced of buckaroos they might need for diapers or beer, with said topping prices than trashed as the behind-the-curtain guys take profits. When the "masses" buy silver from those carnying the bark of its value, as proposed by the barker, and not representative of any "real" value. So when we consider silver we need consider it side-by-side with those things which do have real value. For the human race, those things are: shelter, food, clothing, medicine, and of course, family. With those items, all is good, we remain viable, and can rebuild from anything. Where is silver in that quotient? Noooowhere. Oh sure it has a pretty little sparkle when flashed beneath the light or held next to a fire for a moment, and then what? Ah yes, put back into its place of "honor" tucked away until the next time to look at it. And of the above list of items of value, nothing is more valuable than the ability of a person to Create from their own effort, items they may exchange with others that contribute to the social construct: awe over an apple, months to create! marvel over a loaf of bread fresh from the oven, truly a gift! take joy in the hands of a small child on your cheeks, and thank Jesus for the continuation of the human race! What bohers me most about the silver carnies is there concomitant nod to "The Road" (movie reference) deconstruction of the world.  Our responsibility, for our children and grandchildren, is to reject these seeders of demise, send them scurrying to their holes with their cold, hard metals, and then go plant a tree (metaphor!). And as to the numbers, since no one has been interested in metals for thirty years, where is the thirty years of mined metals in these equations...hmmmm...too, no one, and that is no one, knows how much is in China (whose people are famous for squirreling beneath the floorboards items they wished to keep), or anywhere else in the world for that matter. And then there is full of silver it bursts with it...and when that starts coming up from the mines...there goes your price, down down down. So the physical commodity investor does have much to lose: they lose the value of the standing as being shall we say, "shoulder-to-shoulder" with their fellow humans. Instead of silver, I'll own a bakery. The sniding use of "full faith and credit of the United States" to derisively suggest that our dollars have no value, do not reflect our strength, is ludicrous. I take a FRN out and I say, "350 million people can move a pretty big mountain, when needed."  Oh sure, we have been sated with food stamps the giant bags of potato chips they buy; we have been slimed (as the kids say) with torture porn and the horror the horror (see literary reference: The Heart of Darkness/Joseph Conrad) of genitalia as plot. We have been told that we should support the non-productive, the illegals, the immigrats with their disregard for our ways and our language, accommodating that which should not be accommodated, slivers as those accommodations are beneath our nails. What we are seeing is the end of America's "Great Experiment." For the first time in the history of the Entire World, there was an attempt to kumbiya around one giant campfire because the liberals told all (via the gulaged media complex) that we could all just live together. That America had so much in resources and money that we could bring the entire world to our living standard, or barring that we could certainly raise the standards, eliminate hunger, disease, et al. But what we didn't change, what can't be changed, and what won't be changed, is human nature, and so far, human nature inerrably stamps "sharing" with "self-interest." Nowhere is this more evident than in the immigrats, who have flooded this country. Entire towns have driven out Americans as "others" have taken them over. Recently I went to a mall where I was one of maybe ten or twenty at most whites among endless hordes of Chinese; the immigrats having displaced and overloaded the local system so completely that whites Have learned they are not welcome; the hard-eyed look from the Chinese leaves one distinctly, unwelcome. (Had to go there because of the "computer store.") All of the above is a rather wordy (so sorry, it is a problem for moi!) way of saying that commodites are wonderful, but I prefer: rice, wheat, corn, and watermelon. (Sorry again, the last one isn't really a commodity, but tastes so good!) Yah, we can buy silver, but let's always remember where the real value is. Our work. Our people. And those commodities that sustain daily life. 

Sat, 05/07/2011 - 18:18 | 1251617 JFK.4PREZ
JFK.4PREZ's picture

+great response

Sat, 05/07/2011 - 20:25 | 1251825 JW n FL
JW n FL's picture
on Sat, 05/07/2011 - 18:18


Great Avatar and even Better! Name!

Rock that shit!

Sat, 05/07/2011 - 20:58 | 1251891 chamaflauge
chamaflauge's picture

Nomad hotel-

You convinced me. Monday or Tuesday I'm going out to buy physical might piss off the wife though. Thanks for the heads up

Sun, 05/08/2011 - 07:09 | 1252606 ultarnerd
ultarnerd's picture

Actually I think many people are still trusting paper and had been bidding paper silver up to the extreme but do not forget that the powers that be can print infinite amounts of paper silver flooding the market with it whenever its to their advatage and so can always drive paper prices down and do that without limit.

In fact I believe they plan to eventually do just that.I have read that they already have in place the small print to allow cash settling and the only reason I can see why they do not do it now and crash silver and gold compleatly is that it can only be completely done just the one  time and then all credibility is lost.Think about this they can drive the price down to any extreme they want literally, 1.00 an ounce silver or less by selling infinite amounts of paper silver then by defaulting they can force everyone to take cash settlements on the paper price while physical goes to the moon in backwardation.When the physical price separates they are as of recently by adding some small print, can now force you to take the much lower paper price in cash while they can keep the extra.They are set up now to not only burn you but do it legally.

COMEX can default giving you GLD and or SLV shares and those in turn have the small print to pay in cash.

Seriously I am waiting for silver to go to some small amount like 1.00 an ounce if not zero all while the physical goes to the moon when all this paper fraud is exposed.Seriously just like fiat there is absolutely no limit to the amount they can sell of paper silver contracts, no limit at all and you can bet that as long as, the longer the game the greater the gain then they wont crash it but when its over look out below.Yes naked shorting is supposed to be illegal but what to you expect of too big to fail.

I seriously cannot think of any reason why they would not do this given what I know about JPM eventually doing this.Kind of surprised that this was not the big crash.Actually I only have to think what I would do if I were a ruthless !@#$ banker and that's exactly what I would do too, so I do not really need any proof when common sense is enough.

See and while he may get a few things wrong ?? I know he gets a lot right.

Sat, 05/07/2011 - 01:34 | 1250472 IH10
IH10's picture

Why is there so much focus on the "paper" price of silver as it goes up, but when silver goes down, suddenly the "paper" price becomes meaningless?  It kinda sounds like people lying to themselves or being willfully ignorant.

The answer to your question is simple.  The Comex doesn't manipulate the price up, however, they do criminally manipulate it down with 5 margin hikes in 8 days.  The free market is allowed to determine the price of Apple.  The free market hasn't been allowed to determine the market value of silver in many, many years.  That is about to change.  If you want to buy Apple, go ahead but it's not going to outpace inflation and/or dollar revalution.  The Dow could go to 30,000 but if the USD is practically worthless are you wealthier?  You probably won't connect the dots until it's too late.  Yes, the game is unfair but it sounds like you're content living on your knees as a sychophant.   

Open your mind or someone's going to open it for you.  I don't deal with conspiracy.  I deal with facts.  The facts along with a 3rd grade education would enable anyone with an open mind to see what's going on.  You may be drifting off to a slave labor camp or flipping burgers when we get to the other side of this debacle.  I'll take the carnival as long as my purchasing power stays intact.



Sat, 05/07/2011 - 01:58 | 1250501 Transformer
Transformer's picture

I think that perhaps if you did some research on silver and found out the history of silver and silver price over the last 30 years, a lot of your questions would be answered.

"So if it's not a medium of exchange, is it a storage of wealth?  Yes, indeed it is. But is it better than many other options?  Maybe, but not really. I could pick the biggest "sheeple" stock on Earth - Apple - and it's been a better storage of wealth than silver in the past 2 years, and more broadly, this past decade."

When the hyperinflation starts, Apple will lose most of it's value, just like all other stocks.  Silver will go to the moon, if you can buy it at all.

Sat, 05/07/2011 - 12:55 | 1251110 kumquatsunite
kumquatsunite's picture

 Two years out, silver will be The Least Important commodity. We are "electronified" up to the ears, so the primary commercial use of silver is toast for a decade, at least. Particularly as the recycled silver from older electronic components feeds back in to the "reused" river of silver. Yesterday, my purchases included a 1.7 ounce of potato chips for 99 cents and I swore that I would buy a deep fryer (probably that nice little one from Wolfgang Puck!) and I purchased a 20-ounce root beer that was $1.79! Holey Moley and pass the guacamole! Today on my list is looking up a root beer recipe as I refuse, I refuse to pay these prices. Thus, to that list of commodities ya might want to add sugar beets or cane  and potatoes. And I'll be happy to take your silver for my potatoes when your stomach starts growling! (I grow potatoes in trash cans!) 

Sun, 05/08/2011 - 19:32 | 1253884 ultarnerd
ultarnerd's picture

What you  say makes sense in a drought but we are talking currency crisis,not the same.Every try growing silver in a trash can well its easy to grow potatoes and so can everyone else.Currency crisis can lead to shortages where food becomes much more valuable but that situation wont last long.That's why I also recommend buying lots and lots of anything food related that stores well, as well as also silver, gold and other things too, like solar cells etc.I often point out that in a a very hyperinflationary environment where a loaf of bread goes for 1000.00 you could end up real fast in a 50% income tax bracket if you sell too much, but with food you eat it so no tax.But during hyperinflation in Warner Germany no one bothered paying taxes anywise. I was told its called Bracket creep.

Cover all the bases and your odds of doing well will be better.

You are not alone but.30,000 years of humans learning how to make tools,farm and barter and yet many people today do not get the concept of money.

Sat, 05/07/2011 - 12:53 | 1251114 DosZap
DosZap's picture


 but to the rest the world, silver only functions within the sphere of paper denominations.

Not true, you need to check how the BIG user's feel, and why, and what they are doing, and some have done for as long as they can  remember.

As in China,India,a lot of other Pac Rims,Mexico,just to name three.

Sat, 05/07/2011 - 15:27 | 1251301 zenblkboi
zenblkboi's picture

well said man.    At least somebody here tries to be open mined,  and speak in an adult language.

Sat, 05/07/2011 - 00:10 | 1250382 RockyRacoon
Sat, 05/07/2011 - 12:54 | 1251117 kumquatsunite
kumquatsunite's picture

Ebay is always behind the curve.

Sat, 05/07/2011 - 21:24 | 1251224 RockyRacoon
RockyRacoon's picture

Curve?  It's just one of many selling venues.   Just folks dropping in to pick up an ounce or two for the sock drawer.   It's a place where some get their toe dipped in the water.   Once they hold that ounce they are hooked!   We should be glad for these purely retail outlets.

Mint silver sets should be looked at again.   Use your own judgement in allocating a few stray fiats to some genuine Mint products.   I bought a boatload at the older $32/set range.  The ATB Quarter Silver Proof Sets each contain 0.90420 troy ounces of silver.

2010 United States Mint America the Beautiful Quarters Silver Proof Set™ (SV2)

2010 America the Beautiful Quarters Silver Proof Set history:

March 5, 2010: Price of $32.95 published in Federal Register. Silver is $17.25 per ounce.
May 27, 2010: Sales begin. Silver is $18.36 per ounce.
February 27, 2011: Sales suspended. Silver is $32.54 per ounce.
March 18, 2011: Sales resume. Price increased to $39.95. Silver is $35.15 per ounce.
April 8, 2011: Sales suspended. Silver is $40.22 per ounce.
May 5, 2011: Sales resume. Price remains at $39.95. Silver is around $35 per ounce.

Today's Price: $39.95

Fri, 05/06/2011 - 19:35 | 1249730 The Lawnmower
The Lawnmower's picture

Bought SAE's from Monex at $3.40 over spot.

Fri, 05/06/2011 - 19:41 | 1249747 live free
live free's picture

Picked up 10 oz bars tonight from my local guy at $38.50.


Fri, 05/06/2011 - 21:25 | 1250024 trav7777
trav7777's picture

bbbbut...mosely claven says that there is no silver anywhere

Fri, 05/06/2011 - 22:34 | 1250218 tmosley
tmosley's picture

Lying sack of shit.  Show me where I said that, you fucking liar.

I said lower prices will deplete inventories.  And they have.

But you are too stupid to see that.  Probably pissed off too, because your peak oil investment strategy has falling apart AGAIN.

Fri, 05/06/2011 - 22:40 | 1250241 dogbreath
dogbreath's picture

are you akak's siamese twin

Sat, 05/07/2011 - 00:27 | 1250403 JW n FL
JW n FL's picture





Base money has tripled in 3 years.

2. M1 has continued to increase to its highest level in history.

3. Same goes for M2  Treasury Direct $14 Trillion Debt /   $15 Trillion in Loans /  / ='s $29T



US Treasury Tells Lawmakers It Needs $2 Trillion In Debt Capacity

Sat, 05/07/2011 - 09:07 | 1250715 Urban Redneck
Urban Redneck's picture

US Treasury Tells Lawmakers It Needs $2 Trillion In Debt Capacity

And prior to the launch of the COMEX GOLD FUTURES CONTRACT ON 12/31/74 the way that congress raised the debt capacity was by passing a law which explicitly RAISED THE GOLD PRICE AND DEVALUED THE US DOLLAR. 

Sat, 05/07/2011 - 20:27 | 1251829 JW n FL
JW n FL's picture

Preach it Brother! Preach it!


Sat, 05/07/2011 - 01:40 | 1250484 Transformer
Transformer's picture

It's called supply and demand.  The very first thing they teach you at business school.  We do not need slick New York con men in $2000 suits telling us what silver should sell for.  Let them play their paper games with each other.  Let them fuck each other over as much as they want.  we are the physical silver market and the price here is uncoupling from Comex spot price.  It's happening all over the market right now!!!  In two to three weeks there will be a physical silver price and a paper spot price for con artists.  Take your pick.

Fri, 05/06/2011 - 19:47 | 1249771 Urban Roman
Urban Roman's picture

This is not the FD you are looking for.

Move along..

Fri, 05/06/2011 - 21:08 | 1249979 Two Towers AU AG
Two Towers AU AG's picture

I just came back from a visit to the jewelery district in midtown NYC (47th st).  The reason for my trip was to do a basic market research on whats the physical (AU/AG) being priced and delivery lag times. I spoke with about 15-17 store owners today..Here is what I have found..

Silver ... They are taking only backorders with 3-4 weeks waiting.. and 100% cash may find a couple of misc pieces of 1 or 10 ounce silver but no one has bulk physical silver (100+oz) for sale... the average price (incl premium) is around 45 going all the way to 52 depending on what type/qty of silver you are looking for. This when spot is in the mid 30's...

Gold... Most of the stores are also OUT of Physical gold (1 oz bars, maples etc)... Although 1 store had some maples and australian nuggets.. in 1 oz.. and only 1 store mentioned a 100 oz AU bar for sale.

More than silver.., what strikes me more is the non availability of 1 oz gold.. There has been a pull back in gold but it was not as significant as silver... so there is not much of a reason for holding back sale of gold till price rebound..

Am I missing something here.. it feels wierd to say that the jewelry district in NYC is not selling gold and silver in physical ....Something does not feel right..Is there any other news of Physical gold availability/shortage in the market that I am unaware of OR is some big player hoarding gold along with silver...


Fri, 05/06/2011 - 21:14 | 1250000 nope-1004
nope-1004's picture

ALL the big players are hoarding silver and gold.  The smoke screen that Soros is selling is complete BS.  The pump and dump to shake out the weak hands only allows the big players to load up even more.  So you have to do the same but have to understand that the induced volatility is meant to make you uneasy and feel insecure, with the intent of hoping to finally push you to sell.

They know the dollar is fuked and none of them are buying real estate or treasuries.


Fri, 05/06/2011 - 23:00 | 1250281 Bay of Pigs
Bay of Pigs's picture

You got it nailed nope-1004. Another sign/confirmation? The troll traffic here at ZH has reached epic levels this past week.

Fri, 05/06/2011 - 23:39 | 1250338 Magnix
Magnix's picture

Nothing wrong being a troll or newbies, moron!

Fri, 05/06/2011 - 23:43 | 1250342 Magnix
Magnix's picture

Interesting info. Maybe go one of the coin show in your area. Im going to one in Ft Worth, TX and going to buy more silvers...maybe gold coins.

Sat, 05/07/2011 - 00:39 | 1250426 Two Towers AU AG
Two Towers AU AG's picture

Where can I find out more information about the coin shows......

Sat, 05/07/2011 - 00:23 | 1250399 grey7beard
grey7beard's picture

>> . the average price (incl premium) is around 45 going all the way to 52 depending on what type/qty of silver you are looking for.

Do these folks a favor and tell them about tulving.  He has jm engelhard 100 oz bars at .99 over spot. 

Sat, 05/07/2011 - 00:48 | 1250432 Two Towers AU AG
Two Towers AU AG's picture

I wish I could.. but that would defeat the purpose of my trip there which was to guage at what price could silver coins actually be brought... also.. never been a fan of buying online... for 2 specific reasons...

1. cannot buy PM if I cannot touch and feel before paying up....

2. creates paper record of ownership ( reminds me of Exe Ord 6102 )

While history does not repeat.. it surely can rhyme...

Sat, 05/07/2011 - 07:22 | 1250640 theprofromdover
theprofromdover's picture

Good for U TT, word from the streets is most important. The best posts on this site are all anecdotal.

I would like to hear what is going on in towns and cities 1,000 miles away from the east coast tho'.

I think the 300 year old traders in NYC midtown have maybe seen all this before. I suspect  they have got drawers full of the stuff in the backroom, on hold.




Sat, 05/07/2011 - 16:23 | 1251357 DosZap
DosZap's picture

I can get any silver/gold(Bullion) item I want(except maybe the very limited foreign items), without a wait,Usually, except for ASE's in Monster Boxes(short wait) at times.

I guess I am fortunate, in that I can call it in, wire transfer and PU next day, or take cash and get same day.

I am sure if wanted 10,000 Gld Eagles they may not have them on hand.But, as the norm, I have never had to wait (except in '09, for ASE's, or Mapes),Monsters.

Sat, 05/07/2011 - 12:58 | 1251127 kumquatsunite
kumquatsunite's picture

Funny, three sources within ten miles of me, all have plenty...including people selling their silver sets and jewelry because of the cash available when they do.

Sat, 05/07/2011 - 05:47 | 1250611 Math Man
Math Man's picture


You've all been had, bitchez!


When silver prices hit a three-decade high last week, David Zornetsky decided to do some buying. Searching for a job, the 31-year old in Beacon, N.Y., hoped to use gains from silver to finance a move to New York City and to pay down student loans. "I had been hearing that silver could go up to $150 an ounce this year," says Mr. Zornetsky


"I don't understand," says Mr. Zornetsky, whose silver investment fell about 25%. "Silver is supposed to do very well this year."


Day traders, or individuals who quickly buy and sell stocks, began to focus on silver, much as they did with Internet stocks in the late 1990s. A majority of the 350 individual traders hosted by T3 Trading Group in New York began buying and selling silver, rather than stocks.


Many individuals piled into such funds. Over a three-week period last month, assets at a half-dozen silver ETFs soared about $4 billion, or more than 20%.


Silver ETFs, favored by many individuals, have suffered among the most pain, and there are signs investors are getting out. More than 36 million ounces of silver has been dumped into the market between April 26 through this past Thursday, more silver than all the American Eagle silver coins that investors bought from the U.S. Mint last year.


"Silver prices have been parabolic, but the time to buy again will be months away," he says.

Sat, 05/07/2011 - 10:46 | 1250822 Zedge Hero
Zedge Hero's picture

No, I actually traded my silver for gold 10 days ago, look at the old posts.  You see Meth Man, some of us are even intelligent to know when to fold em, know when to hold em, know when to walk away.  You my friend do not understand this because if you did your posting would stop as the rope would tighten around your neck and you would cease to breath.  I know like myself that you came upon this website because you started to see the storm brewing, but unlike the rest of us you are still in the second stage of anger and I know you can get mucked in this stage. And as a former BS Christian I know how this feels.  It's ok man, it's time to bargain and then we can get on with your stage of depression so you accept  the facts and get ready for the inevitable. To take out on us is very destructive for your own autonomy and very unintelligent, so please move on man, it's ok. 

Sun, 05/08/2011 - 01:07 | 1252407 akak
akak's picture

"Only $5 to dig it from the ground."

"The shit is fucking everywhere!"

Fri, 05/06/2011 - 17:34 | 1249324 Ray1968
Ray1968's picture

I don't know about you all, but I took a complete ass-pounding this week! (and didn't even get kissed)

Fri, 05/06/2011 - 17:36 | 1249331 Terminus C
Terminus C's picture

You got ass pounded if you held SLV, if you hold silver and didn't trade it for fiatscos, you didn't.


Fri, 05/06/2011 - 17:40 | 1249340 Ray1968
Ray1968's picture

I've got plenty of physical bullion. BUT... I have IRA accounts with PSLV and managed commodities accounts that got caught with underwear around the ankles....Blythe strapped on the dong and forgot the lube.

Fri, 05/06/2011 - 17:57 | 1249407 silvertrain
silvertrain's picture

Your not going to retire and cash out next week are ya? Nothing in the world has changed nor will it change..Like has already been said, sit tight..

Fri, 05/06/2011 - 19:08 | 1249640 Moe Howard
Moe Howard's picture

It's a bad time to quit paper silver to retire... Maybe he should wait a week or two. Don't book the loss.

Fri, 05/06/2011 - 18:34 | 1249537 InconvenientCou...
InconvenientCounterParty's picture

I concur fartman.

Hang tight.

The champagne tastes sweeter after a monster comeback.

Fri, 05/06/2011 - 20:03 | 1249818 Tail Dogging The Wag
Tail Dogging The Wag's picture

Champagne does taste beautiful when you're sitting on green monster boxes.

Sat, 05/07/2011 - 20:31 | 1251838 JW n FL
JW n FL's picture

Buy Low! Sell High!! or hold on to them forever, trade in and out into gold if you dont have a pile of both.. I have a minimum I want on hand no matter what and others that I may trade back and forth? but thats a lot of work? why not just buy more of each? I am lazy, sorry.

Fri, 05/06/2011 - 19:10 | 1249648 Zero Govt
Zero Govt's picture


you took a complete pounding because CME hammered the margins pulling liquidity amazes me private investors just sit there and take this absolute corruption (no wonder they get pounded, all they do is whimper!)

...presumably you've no intention of using CME/Crimex ever again???

Sat, 05/07/2011 - 00:26 | 1250406 grey7beard
grey7beard's picture

>>...presumably you've no intention of using CME/Crimex ever again???


Nonsense.  You don't have to use margin, or Comex, to be affected by them driving the spot price down. 

Fri, 05/06/2011 - 19:30 | 1249712 Imminent Crucible
Imminent Crucible's picture

If you've got plenty of physical bullion, then don't worry about paper losses.

Repeat after me: "It's not how many dollars my silver is worth. It's how many ounces I have."

The dollar price will become irrelevant soon enough.

Sat, 05/07/2011 - 02:58 | 1250535 Nate H
Nate H's picture

Be careful of what ye wish for...

Sat, 05/07/2011 - 09:14 | 1250717 Urban Redneck
Urban Redneck's picture

Freedom is never free, it is paid for by blood sacrifice.

Sat, 05/07/2011 - 13:03 | 1251140 DosZap
DosZap's picture

Also, you do not lose until you sell.

Time is on your side............

Fri, 05/06/2011 - 17:43 | 1249359 jesse livermoore
jesse livermoore's picture

listen sit tight and get back to me in one month when we are taking out new highs again.

Fri, 05/06/2011 - 17:54 | 1249405 Crack-up Boom
Crack-up Boom's picture


Sat, 05/07/2011 - 00:21 | 1250392 RockyRacoon
RockyRacoon's picture

From Patrick Heller:

Here are just some of the reasons why you should hold and consider adding to your precious metals position:

  • The US government is still running such huge budget deficits that it now has to borrow 43 cents of every dollar it is spending!
  • During all of this turmoil, the value of the US dollar has continued to decline almost every day except today!
  • US Treasury debt is so unpopular among foreign and domestic investors at current low interest rates that the Federal Reserve is now purchasing 85% of all long-term issues!
  • State and local governments (including public school districts) have not really done anything to cope with the more than $1 trillion in unfunded retirement liabilities.
  • I have not seen the prices of any food products or gasoline drop by 30% this week!  In fact, worldwide food costs are rising at a faster pace this year than ever before!
  • The US government is faced with an impossible resolution of its inflation of the money supply (also called Quantitative Easing 2) program that ends June 30.  The government has to make a decision which of two methods it will choose to further destroy the value of the US dollar—either by stopping quantitative easing or by continuing with a new program.
  • The jobs market continues to be horrible.  As I understand it, the US needs to create 115,000 new jobs every month so that the rising population’s unemployment rate will be unchanged.  Even if the Bureau of Labor Statistics reports a higher number of jobs, you have to back out this figure and also the number of double-counted new jobs attributable to the birth/death adjustment.
  • Residential housing prices have now declined lower than the so-called market bottom in March 2009.  In the latest report, 34.5% of homes sold were bank-owned properties, a much higher proportion than in the past.  Don’t be surprised of home prices continue to fall.

Sat, 05/07/2011 - 13:22 | 1251164 kumquatsunite
kumquatsunite's picture

The jobs market continues to be horrible.  As I understand it, the US needs to create 115,000 new jobs every month so that the rising population’s unemployment rate will be unchanged.


Response: Yesterday, of the five different places that I stopped at for various reasons, here are the stats: Place one: Post office...three of the five people I spoke with who were postal employees had foreign accents (Mexican and Chinese), and were surly (just saying). Place two: Stopped at the 7-11, where I bought a soda and the guy was Iranian or Iraqi. Place three: Stopped at the bank where the woman teller was Chinese and Did Not speak discernable English and bordered on rude. Place four: Ran into the great big store where they sell things cheap, Chinese, and that create giant landfills where the employee understood English but seemed to speak only Chinese since she pointed me to where to go without speaking. Place five: a better quality grocery store and amazing! a white person, who spoke perfect English. So when we are looking at the employment rate, let's bow our heads and read a Pat Buchanan book. We have let in millions and millions and millions of immigrats under the guise of diversity that should actually be called self-annhilation of a country and its way of life. No wonder our welfare rolls are so huge; we are giving the jobs to the foreigners. Stupid is as stupid does. Work keeps honor; without honor we are nothing.

Sat, 05/07/2011 - 16:35 | 1251403 DosZap
DosZap's picture


Same here, every convenience store I stop in.As I am in Texas,majority of customers have become Hispanics, and workers in stores(Paki's-Iranians-Nigeria-Asia-Indians).

Exceptions, are Major Drug chains, and Supermarkets(where it's a veritable mix).

Most commute from smaller  towns nearby,or inexpensive tract homes 30+yrs old.The hispanics are const workers, and illegals,they take up residence at every 7-11 in town, a.m. noon, and evenings.

If there are 25 people in the 7-11, 2-3 may be caucasoids.

The city I live in is smallish, 80k+ pop, but very young/affluent due to area, and industries.Over age 50, is only 16% of the population, and median income is $80k+.

Fri, 05/06/2011 - 18:24 | 1249523 kito
kito's picture

youre gonna lose the silver vs. fiat debate. fed always wins

Fri, 05/06/2011 - 18:55 | 1249601 Lets_Eat_Ben
Lets_Eat_Ben's picture

Yes. And the Feds motive is destrucion of the dollar.

Fri, 05/06/2011 - 21:12 | 1249987 Two Towers AU AG
Two Towers AU AG's picture

Yayyyy..So the Fed is also on our side.. :) :)

Fri, 05/06/2011 - 19:05 | 1249625 OldTrooper
OldTrooper's picture

The sock-puppet has spoken.  Now, please excuse me while I call my local PM dealer.

Fri, 05/06/2011 - 19:37 | 1249743 Citxmech
Citxmech's picture

How'd that work out for Weimar Germany's treasury?

Fri, 05/06/2011 - 22:21 | 1250195 Long-John-Silver
Long-John-Silver's picture

People in Argentina, Zimbabwe, and Wiemar would disagree with you.

Sat, 05/07/2011 - 00:24 | 1250401 JW n FL
JW n FL's picture





Base money has tripled in 3 years.

2. M1 has continued to increase to its highest level in history.

3. Same goes for M2  Treasury Direct $14 Trillion Debt /   $15 Trillion in Loans /  / ='s $29T



US Treasury Tells Lawmakers It Needs $2 Trillion In Debt Capacity

Sat, 05/07/2011 - 04:50 | 1250584 ninj4master
ninj4master's picture

when the dollars will stop to be the international money. the fed will explode

Fri, 05/06/2011 - 20:28 | 1249884 acrabbe
acrabbe's picture

I hold SLV and I didn't get bungholed. In fact, I made money. But of course, this is because I am an option trader. And, but of course, I use it as a printing press to acquire more physical! mwuhhahaha!

Fri, 05/06/2011 - 17:41 | 1249341 Tinfoil Hat
Tinfoil Hat's picture

Still waiting on an order from weeks back, was in the money an hour after placing the order and now down a bit.  Not worried though, look forward to when it finally shows up and value comes back.

Sat, 05/07/2011 - 00:38 | 1250425 Terminus C
Terminus C's picture

I am goin on 4 weeks waiting on my 300 maples...

Fri, 05/06/2011 - 17:57 | 1249409 I Am The Unknow...
I Am The Unknown Comic's picture

@Ray1968   Yeah, me too and so did a lot of us.  My May calls have recently been voted "most likely to expire worthless" by Investor Weekly Magazine.  However, my puts did very well and offset a fair chunk of the losses.  I hope we get a good paper price recovery, and soon.  I'm hoping that with the situation with physical shortage, there should be some upside to the paper soon.  We will have to see.  Meanwhile I will be licking my wounds and keeping some powder dry.  Good luck, and have a restful weekend.  

Sat, 05/07/2011 - 16:42 | 1251423 DosZap
DosZap's picture

I Am,

Yep, like (I think) TD said, or somneone, why not just do the margin 100%, and get it over with.

They are going to continue to do this until they get there anyway.

When Physical becomes really, and I mean Nearly impossible to get,look for the really BIG dogs to step in.

Anyone who thinks this is not a country being run by statists, and fascists will soon see.

Fri, 05/06/2011 - 17:55 | 1249410 Troll Magnet
Troll Magnet's picture

calm down.  this isn't some 100-yard sprint we're running here.  this is a marathon.  unless you're in this to make a quick buck, hold on to your stash and go about your day.

Sat, 05/07/2011 - 00:24 | 1250397 RockyRacoon
RockyRacoon's picture

A bit more from Patrick Heller:

When the December 2010 and March 2011 COMEX silver contracts matured, the available COMEX registered inventories were hopelessly inadequate to meet delivery commitments.  So, as COMEX rules permit, unusually large numbers of these contracts were settled for cash.  There were multiple reports of March contracts being settled for cash at prices more than 30% above the spot price.

As I wrote in last week, there is also a developing shortage of available physical silver outside of the COMEX.  The condition has only worsened in the days since.

On Friday last week, another squeeze was developing with the maturing May silver contracts.  Gold looked poised to jump to $1,600 and silver to surpass $50.  Neither made it.  In fact, silver has dropped nearly 30% from its peak in April and gold is down about 6%.

It looked to me that the Wall Street firms that have huge short positions in gold and silver were on the brink of default on these contracts, if not outright bankruptcy.  So, it is not a total surprise to me that there have been numerous rule changes in the past two weeks by the COMEX and some trading houses to force down the silver price (in particular) and gold.

Many people make investments borrowing money to leverage their results.  As prices rise, it is sensible for the exchanges to raise margin requirements.  However, the COMEX has now raised margin requirements for silver contracts five times over a two week period!  Before these hikes, the minimum margin per contract was $8,700.  On May 9, when the fifth increase takes effect, it will take more than $21,000 minimum per contract!  Note that the last four margin requirement hikes occurred after the price of silver was falling—which does not make sense unless the real purpose is to suppress prices!

Some Wall Street firms have raised the margin requirements for their own customers to as high as $30,000 (see my May 3 column at for details).

The net effect of these rule changes is that it has left many leveraged investors unable to meet these margin calls.  As a result, a significant number of long contracts have been liquidated this week without regard to the price.

In addition, the mainstream media has given more coverage to the silver market this week than it seems like they have given it over the past few years.  Virtually all of this coverage is along the lines that there are major sellers out there, everyone is taking profits, the “bubble prices” of gold and silver have peaked, and the like.

Each of these themes is filled with incomplete or inaccurate information.  If you refer only to these stories, you will run a high risk of making an incorrect decision about whether to buy, hold, or sell gold and silver.

For instance, one of the stories is that Carlos Slim, the current richest man in the world, has presold more future gold and silver production from the mines that he owns.  I have not seen one story reminding people that Slim’s companies last October reported that they had pre-sold 27% of anticipated gold production through the end of 2013 at an average price of $1,189 per ounce and 43% of expected silver production through the end of 2013 at an average price of $18.71 per ounce.  Although Slim is apparently savvy enough to own such mining interests, he is obviously getting bad advice or making poor decisions on how to maximize his profits in these markets.

Much has been made of George Soros reporting that he has sold a significant chunk of his gold holdings, while little has been reported that John Paulson’s much larger holdings are being held until gold reaches $4,000 per ounce.  Among my own customers, there are those who have sold seven figures worth of paper silver contracts above $49 per ounce on the anticipation that they would be able to replace them with physical silver at lower prices.  These customers of ours expect gold and silver prices to be much higher than they reached in April.  They were not getting out of the market, they were just trying to maximize profits.

As for the claims that the “bubble” has burst, the quantity of open COMEX contracts in the gold and silver markets proves that to be false.  When a bubble market starts to tumble, the quantity of open contracts drops sharply.  The number of COMEX gold and silver contracts has only dipped slightly.

As prices started to fall, some unleveraged owners also opted to take some profits and reduce their holdings or get out of the gold and silver markets.  Because of the heightened volatility, other potential buyers have chosen to do nothing for the time being.  Although these actions helped push prices down further, the main force behind falling prices was the COMEX and Wall Street firms’ increases in margin requirements.

As you might imagine, I have been deluged with visitors, callers, and emails this week asking me what is happening and what will happen in the future.

I do not know where the current bottom will be for silver, but I do expect it to reach bottom soon.  One theory is that the silver market has touched bottoms in recent years when the amount of leverage in commodity contracts is only 7 or 8 to 1.  If this holds, that would point to $34 as being the bottom for silver.  Another theory is that the bottom will be reached when silver gets down to its 200-day moving average.  Right now, that points to a bottom of about $28.00.

I don’t think it is a matter of if, but when silver will recover.  When it does, it will recover quickly, though maybe not as fast as it has declined this week.  It is obvious that the US government, its trading partners, and allies have decided to try to cap the price at $50.  I have little doubt that this will eventually be surmounted—almost certainly this year.

Sat, 05/07/2011 - 13:34 | 1251172 kumquatsunite
kumquatsunite's picture

Gufaw! Five bucks and holding is where Ag is gonna live.

Sat, 05/07/2011 - 16:12 | 1251359 akak
akak's picture

Yeah, the price of silver is going to go down to, AND hold, below its actual cost of production from mining?  You have no idea what you are talking about.

Fri, 05/06/2011 - 17:56 | 1249417 Jendrzejczyk
Jendrzejczyk's picture

Went to the coin shop today to complain that the last 100ozs they sold me were defective. They took pity and gave me a nice deal on two 1/2 oz Krugerrs.

(Easiest captcha ever.....1 x __= -6)

Sat, 05/07/2011 - 05:28 | 1250602 pasttense
pasttense's picture

Defective? Tungsten?

Sat, 05/07/2011 - 06:46 | 1250626 Jendrzejczyk
Jendrzejczyk's picture

Something must have been wrong with them, they dropped in price as soon as I walked out of the shop.

Fri, 05/06/2011 - 17:36 | 1249326 uhb
uhb's picture

Hmmm. Tyler, if you are sure, why don't you buy silver at the comex and take physical delivery until your counterparts spit blood?

Fri, 05/06/2011 - 18:00 | 1249421 notadouche
notadouche's picture

"...Government guaranteed loan to beleaguered Chrysler Corp..." The more things change the more they stay the same.  History may not repeat but it damned sure is similar.

Sat, 05/07/2011 - 00:26 | 1250400 RockyRacoon
RockyRacoon's picture

Thumbnail version:

"Back in January 1980, when the Hunt brothers pushed up the price of silver to $50, many politically well-connected Wall Street firms were facing massive losses.  Suddenly, the COMEX changed the rules for trading specifically to punish the Hunts and help these Wall Street firms recoup some of their losses.

Among the most outrageous rule changes was a prohibition against new purchases of long silver contracts on the COMEX.  Parties who already owned long silver contracts were restricted to only one option—to sell it to a party holding a short position.  Prices quickly collapsed."

Fri, 05/06/2011 - 17:42 | 1249342 JW n FL
JW n FL's picture
by uhb
on Fri, 05/06/2011 - 17:36


Hmmm. Tyler, if you are sure, why don't you buy silver at the comex and take physical delivery until your counterparts spit blood?




why would someone want industrial silver bars?

do you know how many times in the past 100 years those types of bars have been confiscated?

do you know under what terms they were confiscated?

do you know what the economic trigger for confiscation was in both confiscations?


what the fuck do you know and why are you speaking at the grown ups table?


get your little smart ass mouth back to the kiddie table where you belong, talk less and listen more or expect a time out.

Fri, 05/06/2011 - 17:43 | 1249349 notadouche
notadouche's picture


Sat, 05/07/2011 - 07:31 | 1250645 rufusbird
rufusbird's picture

A little knowledge is a dangerous thing...

Fri, 05/06/2011 - 19:01 | 1249614 Lets_Eat_Ben
Lets_Eat_Ben's picture

I buried my silver all over a sparesely populated 80+ acre public land plot and then spent another year burying other metals of similar density on that same plot of land. And then i dug it all up and sold it on CL to Miya Butreeks

Fri, 05/06/2011 - 21:07 | 1249982 FluffyCone
FluffyCone's picture

Just curious... How deep do you have to bury silver so that it will not be detected by a metal detector?

Sat, 05/07/2011 - 00:30 | 1250407 RockyRacoon
RockyRacoon's picture

Don't even think about burying your metals.   There are some great old stories about recovered hoards from the Middle Ages.   Dead or forgotten, either way is not smart.

Sat, 05/07/2011 - 16:54 | 1251463 DosZap
DosZap's picture


In a worst case  scenario(Confis),using GPS, to plant, and giving the L & L co-ords to one of your kids, and spouse.

Do you not think that a good idea?.Would be easy enough to find later with that system.(We have some extremely good midnight gardening tools now, never before available.

 Plus, if all 3 are dead.............who cares if it's ever found.

Sat, 05/07/2011 - 21:30 | 1251980 RockyRacoon
RockyRacoon's picture

I guess it's just me.   I like to massage the hoard and change the configuration of the denominations and types of bullion/coins.   Tweaking is fun and it can't be done X feet under dirt.  You are right about the dead and gone part -- who cares?

Fri, 05/06/2011 - 21:10 | 1249989 FluffyCone
FluffyCone's picture

Umm. I don't know. Please tell me...

Fri, 05/06/2011 - 17:37 | 1249327 Terminus C
Terminus C's picture

Wait wut...?  SLV isn't silver?

Fri, 05/06/2011 - 17:57 | 1249418 Troll Magnet
Troll Magnet's picture

you can actually eat SLV.  you can also use it to barter when SHTF and people are running out of toilet paper.

Fri, 05/06/2011 - 18:23 | 1249519 ZeroPower
ZeroPower's picture

Thats awesome cause you can eat physical as well. And, even better, when you try and barter with your Ag to the real wise ones holding gold, they will laugh at your face for being such a peasant with the lower class metal.

Fri, 05/06/2011 - 18:30 | 1249533 Troll Magnet
Troll Magnet's picture

like many PM owners, i own both gold AND silver. 

so i'm not worried about having to lick the ass of other gold owners anytime soon.

Fri, 05/06/2011 - 20:04 | 1249835 Tail Dogging The Wag
Tail Dogging The Wag's picture

I'm also fully diversified in gold, silver, farmland, livestock, equities, some colourful cash and sitting on a year's food supplies just in case.

Sat, 05/07/2011 - 13:55 | 1251195 Abitdodgie
Abitdodgie's picture


Fri, 05/06/2011 - 19:15 | 1249653 Lets_Eat_Ben
Lets_Eat_Ben's picture

Silver is a far superior form of money than debt. Also, fuck you.

Fri, 05/06/2011 - 18:30 | 1249536 mick_richfield
mick_richfield's picture

you can also use it to barter when SHTF and people are running out of toilet paper.

No!  That is not true! 

I tried that, and it made my asshole bleed!

Fri, 05/06/2011 - 22:33 | 1250227 blunderdog
blunderdog's picture

I dunno about that, but I put a few dozen SLV receipts in a pillowcase and tried to mug an ole lady, and it didn't work near as well as my eagles...

Fri, 05/06/2011 - 23:09 | 1250291 defender
defender's picture

ummmm, I believe you are supposed to use the colorful side of the paper for that act... not the edge.....

Fri, 05/06/2011 - 17:37 | 1249329 gdnchg
gdnchg's picture


Fri, 05/06/2011 - 17:40 | 1249333 achmachat
achmachat's picture

could it be possible that the bullion dealers just pretend that they're sold out because they don't want to sell at lower prices than what they bought it for?

i bought more physical this morning, and, nevertheless, that specific store was sold out of philharmonics an hour after my purchase.

Fri, 05/06/2011 - 17:48 | 1249372 in4mayshun
in4mayshun's picture

No doubt that the big PM retailers are sand-bagging, but who cares? The result is the same.

I wouldn't sell my physical for $38.00 either.

Sat, 05/07/2011 - 00:30 | 1250415 RockyRacoon
RockyRacoon's picture

There's nothing to be gained by holding back stock.  A dealer sells for whatever price/profit is acceptable.   Keeping a trickle going is good for holding on to regular customers but no large lots would be made available at this volatile juncture in the markets.   The reason you may be seeing small quantities on hand is that the dealer is doling out stock to retain the customer base.   Underselling a competitor doesn't really play into the scenario.

Fri, 05/06/2011 - 17:48 | 1249387 traderjoe
traderjoe's picture

Anything is possible. 6 months ago - before I backed up the truck - I called 10 coin dealers in my town. The amount of silver available at that time was limited to 50 ounces or so. Many where completely out. Don't know how it has changed since then.

Fri, 05/06/2011 - 18:02 | 1249446 Catullus
Catullus's picture

That's an interesting business model called "not selling".  Let me know how that works out.

Joking around of course. 

Fri, 05/06/2011 - 18:11 | 1249481 achmachat
achmachat's picture

ok, just found another bullion dealer with good up-to-date prices and ordered a test batch of 100 Philharmonics for 28,81 € / ounce including taxes.

They seem to have lots of them left if anyone is interested.

Sat, 05/07/2011 - 01:59 | 1250498 ciscokid
ciscokid's picture

Could you please share the dealers name? As i cannot get silver below 32

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