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Something Just Broke In The U.S. Silver Market

Tyler Durden's picture




 

Submitted by Steve St.Angelo via SprottMoney.com,

After looking over all the figures, it seems as if something broke in the U.S. Silver Market this year. By that, I mean the normal supply and demand forces no longer make sense. I believe this stemmed from the massive amount of physical silver investment demand beginning in June as financial and geopolitical events pushed the retail silver market into severe shortages.

To start off, the United States has been the largest importer of silver in the world for many years. Even though India has imported more silver recently, its annual amount has fluctuated widely, while the U.S. has been more consistent.

For example the U.S. silver imports have ranged between 4,500-6,000 metric tons (mt) a year, while India imported between 2,000-7,000 mt. Overall, the U.S. is the clear winner by importing a total of 39,500 mt of silver from 2007 to 2014, while India totaled 31,700 mt.

To put these metric ton figures into perspective… look below:

  • Total U.S. Silver Imports 2007-2014 = 1.27 billion oz
  • Total India Silver Imports 2007-2014 = 1.02 billion oz

The reason the U.S. imports so much silver is due to its large industrial silver manufacturing industry. Here were the top five industrial silver fabricators in 2014, according to the 2015 World Silver Survey:

  • China = 5,788 mt
  • U.S. = 3,902 mt
  • India = 1,470 mt
  • Germany = 652 mt
  • S. Korea = 652 mt

While China is the largest industrial silver fabricator in the world, it also produces a lot more domestic silver than the U.S. In 2014, China produced 3,568 mt of silver, while U.S domestic mine supply was only 1,169…. three times less. So, the U.S. must import more silver than China to meet its total fabrication needs.

Furthermore, the U.S. Mint has been producing more Silver Eagles each year, which requires additional imports of the metal. Now, with that basic ground work, let’s look at why the U.S. Silver Market dynamics were altered this year.

Something Changed In The U.S. Silver Market

As I mentioned in several articles, U.S. silver imports surged at the beginning of the year. This continued with another whopping 533 mt of silver imported in September for a total of 4,476 mt for the first three-quarters of the year:

U.S.-Silver-Imports-Q1-Q3-2014-vs-2015

Thus, total U.S. silver imports are up 798 mt from the 3,678 mt imported last year during the same time period. Which means, the U.S. imported an extra 25.6 million oz (Moz) of silver this year over last. That’s a lot of silver.

NOTE: These U.S. silver imports are bullion and dore bars. Silver bullion is high quality bullion ready to be used as investment or fabrication, while dore bars are semi-pure bars poured at the mines needing further refinement.

Why all this extra silver? Was it due to industrial demand? Well, let’s take a look. These next two charts show the change in U.S. industrial silver imports and exports (Q1-Q3) compared to last year:

U.S.-Industrial-Silver-Imports-2014-vs-2015

According to the USGS, the U.S. imported more silver waste silver scrap (4,710 mt vs 3,690 mt), semi manufactured forms (795 mt vs 252 mt) and powdered silver (664 mt vs 436 mt) in the first three-quarters of 2014 compared to 2015. The total silver imports of these three industrial categories was 29% lower this year compared to 2014.

Okay, how about U.S. industrial silver exports:

U.S.-Industrial-Silver-Exports-2014-vs-2015

Here we can see the same trend. The U.S. exported less silver waste scrap, semi manufactured forms and silver powder this year to date compared to the same period in 2014.

NOTE: There are two other categories of industrial silver imports-exports, however I did not include them as their total figures were much smaller than the three listed above. In addition, even though total U.S. silver waste scrap tonnage is significant (11,000 mt ytd), it turns out to be only worth 33 cents an ounce.

Now, if we take the net change for Q1-Q3 2014 vs 2015, this is the result:

U.S.-Silver-Market-Dynamics-2014-vs-2015

As we can see in the chart above, the U.S. imported 798 mt of silver bullion and dore bars Q1-Q3 compared to last year, but industrial silver imports (silver powder & semi manufactured forms) were down an astonishing 771 mt and industrial silver exports were down 353 mt.

When I made the chart above, I only included the two fabricated silver components of semi manufactured forms and silver powder. So, as total silver imports surged, industrial silver imports plummeted while industrial silver exports declined significantly.

Again, why did the U.S. import so much more silver this year if industrial silver supply and demand were down considerably compared to last year. If U.S. silver imports continue to be strong for the remainder of the year, it could reach over 6,000 mt. The last time the U.S. imported that much silver was in 2011.

I went back and looked at the data for 2011 and found some surprising results. If we compare U.S. silver supply and demand for the first three-quarters of 2015 vs 2011, this is the outcome:

U.S.-Silver-Market-Dynamics-2011-vs-2015

Even though the U.S. imported 284 mt more silver bullion and dore bars during the first three-quarters of 2011 than during the same period this year, industrial silver imports were 161 mt higher and industrial exports a staggering 1,150 mt larger. So, it made sense for the U.S. to import 6,300 mt of silver in 2011.

However, this wasn’t the case this year. So, again… where did this silver go? Maybe some of it went into the surging physical investment demand. If we look at the next chart, we can see that U.S. Silver Eagle sales hit a record 47 Moz this year:

Silver-Eagle-Sales-vs-Avg-Annual-Price

While total Silver Eagle sales were 7 Moz higher this year versus 2011, the Comex silver inventories also fell from a high of 184 Moz in the beginning of July down to 158 Moz currently:

COMEX-Silver-Inventories-DEC-18-2015

To sum this all up, the U.S. has imported 20% more silver in the first three-quarters of 2015 compared to last year while industrial demand has fallen considerably and the COMEX silver inventories declined 26 Moz from its peak.

So, for whatever reason… there is more silver coming into the U.S. than the market dictates. Of course, physical silver investment demand is much higher this year, but it doesn’t account for all the extra silver imports. Thus, some large entities must be acquiring silver off the radar.

Why Did The U.S. Silver Market Break From Its Normal Market Dynamics

According to the USGS silver import-export data, the U.S. Silver Market is behaving much different from previous years. As I stated, U.S. silver bullion and dore bar imports hit a record 6,000 mt in 2011. However, this was due to elevated industrial silver demand and exports.

This year, the U.S. is on track to import 6,000 mt, but industrial silver supply and industrial exports are down considerably. Which means, the huge increase in U.S. silver imports must be due to physical silver investment demand. This doesn’t make sense as the price of silver is trading at a four-year low.

As I mentioned, there was a large decline of silver inventories at the COMEX this year. Furthermore, according to the 2015 Silver Interim Report by the GFMS Team at Thomson Reuters, they show a 17.1 Moz net decline of Global Silver ETF inventories, while physical bar and coin demand rose to 206.5 Moz this year.

Looking at the following chart from my article, DEATH OF PAPER GOLD & SILVER: The Data Proves It,

Silver-ETF-Build-vs-Coin-Bar-Demand

We can see the drastic change of investor sentiment for physical silver bar and coin over Global Paper Silver ETFs. In over the past five years, Global Silver ETF inventories experienced a net build of 18.2 Moz compared to 994 Moz of physical silver bar and coin demand. Moreover, that figure is conservative due to the fact that the GFMS Team at Thomson Reuters does not include private silver rounds (bars) in their data.

Again, something broke in the U.S. Silver Market this year. I believe it had to do with the beginning shock of a possible Greek Exit of the European Union and continued by the threat of a U.S. and broader stock market collapse. Even though the Fed and Central Banks continue to prop up highly inflated over-leveraged Bonds & Stocks, this is not a long-term sustainable economic policy.

At some point, investors (especially wealthy investors and institutions) will start buying physical gold and silver to protect wealth before the collapse of the Greatest Ponzi Scheme in history begins in earnest. It will only take a small percentage increase of new buyers, say 2-3%, to totally overwhelm the precious metal market. When I say 2-3% new buyers, I am referring to those currently invested in paper assets.

The U.S. Silver Market broke a trend this year which I believe is significant going forward. While precious metal investors may be frustrated by the low paper price of gold and silver.. the fundamentals for owning the metals are stronger than ever.

 

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Wed, 12/30/2015 - 19:04 | 6979902 RadioFlyer
RadioFlyer's picture

Whew, glad it only broke. I'm worried about another 'snap'! Everything else is snapping in the markets, so broke-back mountain must be ok.

Wed, 12/30/2015 - 19:06 | 6979908 yogibear
yogibear's picture

Let me know when someone buys up the silver contracts and demands delivery. Same with gold.

The Comex is the Ponzi exchange.

Wed, 12/30/2015 - 20:20 | 6979920 RaceToTheBottom
RaceToTheBottom's picture

"Hunt brothers, Hunt brothers....  Clean up on aisle 7 of JP Morgan"

Thu, 12/31/2015 - 06:32 | 6980807 Anopheles
Anopheles's picture

Most have no intention of ever taking delivery.   If they take delivery, they have to PAY for it in full. 

Say you are a small investor and buy a dozen gold contracts.  Those contracts might get you up to +/- $20,000 if there are big swings in price. Affordable risk for a small investor.

However, to take delivery you would have to IMMEDIATELY pay $1.3 million dollars cash.   Why buy and sell millions of physical when you can get the same benefits only putting out thousands. 

Fri, 01/01/2016 - 15:18 | 6985833 RaceToTheBottom
RaceToTheBottom's picture

The casino called modern finance.

Wed, 12/30/2015 - 19:07 | 6979913 DirkDiggler11
DirkDiggler11's picture

Something just broke in the _________ market. Fuck, I'm growing weary of these headlines. Either they are all BS click-bait, or the end is really fucking here.

Wed, 12/30/2015 - 19:51 | 6980040 KesselRunin12Parsecs
KesselRunin12Parsecs's picture

They meant to say "Somebody just went broke in the US silver market"

Thu, 12/31/2015 - 00:44 | 6980802 HamFistedIdiot
HamFistedIdiot's picture

LOL!

I just listened to a Chris Martenson interview with David Collum who stated that he wouldn't be buying until investors had sworn off the particular asset. What will it take for die hard ZHers to give up on PMs? For me, buying silver has become something of a religion (combination of greed and Constitutional fervor). Maybe if there is the mother of all deflationary collapses, and silver sits at $6 per oz for 5 straight years I might be upset at having "backed up the truck" at $20 and my other entry points both higher and lower. Today I just bought some more. I say to the collapse: "Bring it!" But it's more bravado than anything else. I don't want to see the 100 million welfare zombies who voted for Obama and Hillary coming for my food and other stores. I really do hate debt based currencies! And there is always a hope that though markets continue to nosedive as the tsunami of FRNs unleashed upon the world since 2008 are brought back home, that silver will finally get a bid and I'll see a green arrow again next to the spot price. Or maybe it will go up 5-fold or more from where we are now, and I'll be able achieve some land development goals of mine. One can always hope.

Wed, 12/30/2015 - 19:53 | 6980043 BustainMovealota
BustainMovealota's picture

"or" ?? , it can be both

Thu, 12/31/2015 - 00:05 | 6980788 Jethro
Jethro's picture

Maybe it's that Wyle E Coyote moment where he is hanging in mid air, but it's just continued for 8 years now?

Wed, 12/30/2015 - 19:07 | 6979915 Bay of Pigs
Bay of Pigs's picture

Tom Power CEO of Sunshine Mint explains physical demand at his company which has tripled in production the last seven or eight years yet still isn't producing enough. He speaks of having "capacity challenges" and "running 24/7 since 2009".

https://www.youtube.com/watch?v=8wjW30p9nrY

Wed, 12/30/2015 - 19:07 | 6979916 ILike2Watch
ILike2Watch's picture

Why are folks so surprised at the low price? The upper echelon is forcing prices down so they can buy more with the over printed FIAT, then and only when they have "enough" the "collapse/boom" will happen. They will still have all "the money" after the FIAT is declared "worthless".

Wed, 12/30/2015 - 19:15 | 6979930 83_vf_1100_c
83_vf_1100_c's picture

  There is no shortage. I can go online and buy all I want. Like fuel, I am happy buying it on the price decline. When fuel goes way up I will be on the wifes ass to quit driving all over Texas. When AU/AG goes up as it will (someday) I will re-examine how much I want to hold on to. This shit ain't rocket science. Take a $100 bill. You got many choices but imagine walking into walmart and exchanging it for some plastic crap that will soon find its way into storage with all the other plastic crap you just had to have. In a couple years you can't give that junk away. Or, walk into a coin shop and exchange that bill for 5+ troz of silver. 2 yrs later it will still be 5 troz of silver and hold whatever value TPTB manipulate it to be but it will not be junk. Or, go buy a $100 stock or t-bill or etc. If you like to gamble. I know folks who lost their asses in 2008 so good luck with paper investments. For every guy who boasts about the killing he made on XYZ stocks, someone else lost their retirement. Metals are real and sound and even sexy if it's AU/AG. Fiat is pretty much Monopoly money now.

Thu, 12/31/2015 - 08:43 | 6981242 Buster Cherry
Buster Cherry's picture

Go easy on the wife. At least she's not driving all over California, New York or Illinois.

Wed, 12/30/2015 - 19:16 | 6979935 Soul Glow
Soul Glow's picture

Silver is fucking priceless.

Wed, 12/30/2015 - 21:30 | 6980354 1stepcloser
1stepcloser's picture

I just watched housing's big short movie... now I'm watching silver's big long movie in real time..  

Wed, 12/30/2015 - 19:19 | 6979944 Wahooo
Wahooo's picture

Dollar rose, silver imports got cheaper and exports got more expensive.

Wed, 12/30/2015 - 19:20 | 6979950 Agstacker
Agstacker's picture

I'll keep stacking, much rather look at my silver than the FRN's in my wallet.

Wed, 12/30/2015 - 19:26 | 6979974 superyankee
superyankee's picture

"...huge increase in U.S. silver imports must be due to physical silver investment demand. This doesn’t make sense as the price of silver is trading at a four-year low."

 

Ummm has anyone seen a supply demand curve? Supply goes up, price goes down, demand at lower price rises to meet supply.

 

Mystery solved by Econ 101. Can I have my 10 minutes back?

Wed, 12/30/2015 - 19:39 | 6980009 Ban KKiller
Ban KKiller's picture

"Thus, some large entities must be acquiring silver off the radar".....I won't confess. 

Wed, 12/30/2015 - 19:46 | 6980030 buzzsaw99
buzzsaw99's picture

for some reason i thought silver eagles had to be made from silver produced in the usa. i guess i was mistaken. i don't know why i ever paid 2X spot for silver eagles even though it turned out to be a good move at the time. i sure wouldn't pay what they are (seemingly) asking now.

Thu, 12/31/2015 - 08:36 | 6981238 Buster Cherry
Buster Cherry's picture

I thought the same but cannot remember what pm dealer I heard that from.

Wed, 12/30/2015 - 19:48 | 6980034 stumbLebum
stumbLebum's picture

The only thing that's broke are the Zero Hedge greater fools who bought silver and gold and are now flummoxed over their own stupidity.  All the normal folks kept their 401(k)s invested in equities these past 6 years and are riding higher than ever.

But the perpetually angry Zeroes - pissed that they've missed out on 6 years of solid gains - gather here to nurse their wounds and whine about the good fortune and common sense everyone else had.

Zero Hedgers are the dumb money crowd.

Wed, 12/30/2015 - 20:12 | 6980094 So It Goes
So It Goes's picture

That is the stupidest post I have read in a while.  So you are saying the Fed, printing currency out of nothing is the smart money???????

LOLOLOL - jerkoff.

Thu, 12/31/2015 - 01:52 | 6980967 Kirk2NCC1701
Kirk2NCC1701's picture

Got ADD?  He said that you could have and should have stacked your 401k, not PM.  In this case, with the benefit of hindsight, he was... "right on the money", you might say.

The only real allocation one has to deal with, is what Mix Of Assets will perform the best for YOUR time horizon, not someone else's.  Owning shares in successful businesses is almost always preferable to other forms, unless it's in land that will appreciate due to demographic inflow (e.g. coastal properties).

Of course it's prudent to also hold some Precious Assets (Precious Metals, Precious Stones, rare art, vintage assets), but having a MIX of these is always preferable to betting/GAMBLING on only one.

Wed, 12/30/2015 - 20:23 | 6980133 JamaicaJim
JamaicaJim's picture

OK Mr One week. Nice analogy - except for one thing.

Most of us "dumb money crowd" were in equities, and also PM's

I'd lurk around while before opening your big fat stupid mouth around here.

By the way....fuck off

Wed, 12/30/2015 - 20:24 | 6980135 Big Corked Boots
Big Corked Boots's picture

Twelve days you've been on this board. Come back when you grow up some.

Wed, 12/30/2015 - 21:05 | 6980284 tmosley
tmosley's picture

Post your name smart guy. The Day of the Rope is coming.

Thu, 12/31/2015 - 01:55 | 6980978 Ward no. 6
Ward no. 6's picture

normal isn't fun

Thu, 12/31/2015 - 03:31 | 6981054 Sir John Bagot Glubb
Sir John Bagot Glubb's picture

The so-called Normals won't get out when the shit hits the fan.  They are too greedy, especially by now.  It'll be like 1,000 people playing musical chairs with one empty chair when the music stops. They'll give back all they made the last 6 years while those of us with PMs will be riding high, making all the money the Normals will have lost and then some.  That's the whole point of owning PMs.  

Wed, 12/30/2015 - 19:56 | 6980041 herkomilchen
herkomilchen's picture

This industrial supply/demand jonkerwonking with silver's price illustrates why silver is inferior to gold for use as money.

Silver holders, watch out for price drops when industrial demand falls off with this next recession.

Wed, 12/30/2015 - 19:56 | 6980047 Cycle
Cycle's picture

Based on historical silver price cycles, silver price is near what is predicted currently. This silver cycle model suggests a low of ~$13.25 in the March, 2016 time frame.

Wed, 12/30/2015 - 20:41 | 6980193 Cycle
Cycle's picture

The same model posted on 2015.10.09 suggested a price of ~$14.00 at the end of 2015. Of course, this was partly luck since these models have associated error both in time and price predictions.  This should garner another downvote or two.

Wed, 12/30/2015 - 19:58 | 6980053 worbsid
worbsid's picture

I don't deal in MTs but I do the best I can.

Wed, 12/30/2015 - 20:00 | 6980062 Dead Canary
Dead Canary's picture

Wake me up when something happens.

Zzzzz.....

Wed, 12/30/2015 - 20:01 | 6980066 One of We
One of We's picture

Something JUST broke?  Lol....I love to hold gold but i can hardly bring myself to stack any with silver so devalued vs. traditional AU/AG ratios plus silver is consumed with industrial uses more so than gold...Silver is a pain in the ass to move around and I imagine ill run out of places to have boating accidents eventually.....

Wed, 12/30/2015 - 20:05 | 6980074 ToSoft4Truth
ToSoft4Truth's picture

Oil has been breaking to new lows.  Silver is breaking to lower lows. 

I'm waiting...  soon the idiots who bought at 30, yet still owe truck payments will be selling.

 

Wed, 12/30/2015 - 20:47 | 6980219 So It Goes
So It Goes's picture

"soon the idiots who bought at 30, yet still owe truck payments will be selling."

 That makes me sad.  Said another way, people, who bought insurance against a currency collapse, bought too soon.  Or, the market can stay irrational longer than you can stay solvent.  And then you are gleeful that you are going to pick their bones.  Really?  

 

I wonder how much you gave to charity this year?  I think you are missing a major point in life.

Wed, 12/30/2015 - 20:54 | 6980249 ToSoft4Truth
ToSoft4Truth's picture

Did you fall out of Pinterest? 

 

Grab ya a dozen:

 

Help Syrian Children

7.5 million children are affected by the brutal four-year-old conflict in Syria. Children have been put at risk by unrelenting violence, crumbling infrastructure, ruined schools and hospitals and shortages of essential supplies. In some areas, UNICEF is maintaining the entire water supply.

 


 

Wed, 12/30/2015 - 20:06 | 6980079 YouThePeople
YouThePeople's picture

Something didn't just break. It's been broken for a long time. The market is broken/distorted across the board.

It will continue this way until it collapses under the weight of it's own lies/fraud. Then on to the next scam.

The majority of Americans can't be bothered with this. They've got pictures of Happy Hour to Facebook

and todays celebrity wardrobe malfunctions to tweet. You know...the important stuff.

Thu, 12/31/2015 - 01:00 | 6980897 Bopper09
Bopper09's picture

Like dudes cutting their dicks off.  Buckle up, Buckaroos!

https://www.youtube.com/watch?v=fhNypbg1DgM

Wed, 12/30/2015 - 20:07 | 6980080 Trubador
Trubador's picture

"Moreover, that figure is conservative due to the fact that the GFMS Team at Thomson Reuters does not include private silver rounds (bars) in their data."

This! Buying private bars and rounds is cheaper than buying "official" Eagles from the U.S. Mint. Gold (even at approx. $1000/t.oz) is way out of the average person's price range. But silver (a known metal used for coinage and private exchange) is a great (yet much cheaper) physical investment. And, if you want to get as much for your $ as possible, you go to private bullion sources for your purchase.

I'm not saying that makes up for the discrepancy in the numbers mentioned in the article, but I'm sure it's a significant factor. I, myself, have been watching the spot pricing of silver and am waiting (though not too much longer) for the silver price to reach a certain point. Then I will buy a small stash via private coin/bar dealers. It won't break the bank, and it's a great secondary (compared to gold) easily usable item to use for barter/exchange if a national (or global) economic emergency or collapse should occur.

Wed, 12/30/2015 - 22:00 | 6980465 Dickweed Wang
Dickweed Wang's picture

This! Buying private bars and rounds is cheaper than buying "official" Eagles from the U.S. Mint.

 

That may be true but when it comes time to cash in using Silver Eagles will be much more broadly accepted, and desired, then privately minted bars and rounds.

Thu, 12/31/2015 - 06:10 | 6981139 lakecity55
lakecity55's picture

As will pre-1965 90% coins.

You will be able to barter with the moar exotic stuff.

Wed, 12/30/2015 - 20:07 | 6980081 tailgunner
tailgunner's picture

I love these reports when they totally leave out silver for investment or protection.  Stupid as can be, and to be ignored.

Wed, 12/30/2015 - 20:08 | 6980085 CHX
CHX's picture

Just keep stacking... see you on the other side. Good luck and happy 2016 #shit's about to unravel

Wed, 12/30/2015 - 20:19 | 6980117 ToSoft4Truth
ToSoft4Truth's picture

Hell, yea!  Next spring for sure and this time, for real-real.

Plus it’s a Jubilee year in 2016. America is mostly full of Gentiles right now so no 2015 Shemitah.  That’s another sign. 

Wed, 12/30/2015 - 20:09 | 6980087 charliebrown
charliebrown's picture

Morgan Chase alone has billions of silver reserves accumulated in the past two years, and that would explain these numbers.

Wed, 12/30/2015 - 20:27 | 6980148 Budnacho
Budnacho's picture

As much as I love silver....I felt the siren-call of the 1/10th Gold Eagles calling today....that and a Zimbabwe 10-Billion Note...

However I did get my boss a collectible coin, I'm slowly introducing him to silver by building him a little pile that he thinks is "cool"...one day I'll ask for and get a Monster-Box as my yearly bonus...;-)

Wed, 12/30/2015 - 20:35 | 6980176 ToSoft4Truth
ToSoft4Truth's picture

The Mighty Mississipp is overflowing.

You want to buy up critical supplies right now, and sock it to the lazy buyers who procrastinated. 

Wed, 12/30/2015 - 20:49 | 6980236 Dan The Man
Dan The Man's picture

I'm quite comfortable in my extra long term plan.  I bought a whole bunch at 9$/oz about 8 yrs ago and its all going to my children.  

Price matters not.

Wed, 12/30/2015 - 20:55 | 6980253 harrybrown
harrybrown's picture

whatever... just keep stacking folks

Wed, 12/30/2015 - 21:01 | 6980272 Consuelo
Consuelo's picture

A humble poster above asks:

 

"The question is how long can the disconnect continue. Any answer?"

 

As a matter of opinion, yes.  

Don't look for anything domestically to 'happen' that will make right or reverse the trend of chicanery that goes on in our markets.   A decades-long trend of corruption, lying, cronyism, monetary theft and fiscal malfeasance does not a righteous overnight turnabout, make. Rather, it must be destroyed.   And be destroyed it will, when a certain currency - or basket thereof, that has gold and perhaps even silver tied to it in some fashion, overtakes the $USD as currency of choice, by choice.    And that shift is most likely to come about in an accelerated fashion by way of gross foreign policy miscalculation.   In fact, it is happening right before us in real time. 

Wed, 12/30/2015 - 21:24 | 6980306 Burticus
Burticus's picture

Steve St.Angelo has been tirelessly analyzing every fundamental aspect of the silver market for several years and was mentored and encouraged to start his own web site by the all-knowing Dr. Jim Willie.  He's now a prolific poster on GoldSeek, referenced by many prominent market analysts and apparently now hooked up with the big dawgs at Sprott.

Meanwhile, even technical analyst Avi "the year the bulls die" Gilburt says the charts show the metals are bottoming and expects a multi-decade bull market will begin in 2016.

I think it's time to trust physical silver more than FeRNs at insolvent zombie banks...

Wed, 12/30/2015 - 21:32 | 6980361 HighPressure
HighPressure's picture

I started stacking RCM physical silver this year and plan to keep stacking until I reach 3000oz. So please keep manipulate the price lower. Thank you in advance...

Thu, 12/31/2015 - 00:54 | 6980884 Bopper09
Bopper09's picture

I like the extra 9 for fineness.  Have quite a few as well, and the animal rounds increase in value quite well, regardless of some fake paper bullshit pricing scheme.

Thu, 12/31/2015 - 08:24 | 6981232 Burticus
Burticus's picture

I also like the RCM bars and added about 4,000 ounces of them this year.  Recently, their price has been lower than Engelhard or JM bars and they also stack better.  Twenty will fit perfectly in a silver eagle monster box.  Of course, I have to put the box where I want to store it before loading the bars, since I can't lift it full...

Wed, 12/30/2015 - 21:40 | 6980385 oldguy1
oldguy1's picture
2015 Silver Wrap-up and Drutter's "Price vs. Demand" Divergence https://www.youtube.com/watch?v=VWmzyTcnnPM
Wed, 12/30/2015 - 21:43 | 6980397 insanelysane
insanelysane's picture

One wonders if the gold supply has been cored out and there is a switch to silver.

Wed, 12/30/2015 - 21:56 | 6980455 frankly scarlet
frankly scarlet's picture

China and Russia are betting on PMs to become monetized again. The power elites are betting on China becoming the capitalistic model for the rest of the world....therefore I own some PM to the tune of 10% of net worth and believe this hedge will pay well if the stupids don't blow the whole place apart with nuclear weapons...but in that case who gives a flying fuck what the outcome is.

Thu, 12/31/2015 - 10:44 | 6981496 jakesdad
jakesdad's picture

I'm at ~1% ag but I look at it more as bail-in/greece insurance than an investment (though I won't complain if it skyrockets)

 

may have to put in an order today though at these prices!

Wed, 12/30/2015 - 22:05 | 6980478 Dr. Gonzo
Dr. Gonzo's picture

A Silver Eagle is $1 of money from the Treasury of our Government and says says so on the coin. A dollar bill is one dollar of debt currency from a private foreign bank called the Federal Reserve that is also legal tender here. I'd rather save in the coin money from our government's treasury.

Wed, 12/30/2015 - 22:11 | 6980492 Jack's Raging B...
Jack's Raging Bile Duct's picture

I doubt it would be enough to impact supply, but perhaps much the silver is going into high grade weapons? Guided missles, drones, etc, they all use copious amounts of silver. Just a thought.

Wed, 12/30/2015 - 23:02 | 6980625 Seasmoke
Seasmoke's picture

Just imagine if they made dimes and quarters with SILVER.

Thu, 12/31/2015 - 01:25 | 6980943 Manipuflation
Manipuflation's picture

Good point.  I sure wish I had some.

Wed, 12/30/2015 - 23:32 | 6980705 ebworthen
ebworthen's picture

Ah yes...the tangibles...useful in industry and as real money!

Wed, 12/30/2015 - 23:34 | 6980714 Fred123
Fred123's picture

Wow, the fundamentals of silver have been broken for ....years? Ummm......maybe it isn't silver with the problem.

Wed, 12/30/2015 - 23:43 | 6980740 Lazane
Lazane's picture

Central Banks are piling up silver bars like Paul Bunyan piles up cord wood. These same why don't we call them what they really are, the moneychangers always make out on both sides of the transaction. They have been busy driving down the cost to buy real physical silver by unlimited, manipulation er ah a shorting the paper silver. They are setting the table for a huge and I mean HUGE!
financial windfall. Don't know when, though it definitely is coming, if i had to guess it will be before the negro in the whitehouse leaves office as potus and declares ML and anoints himself dick wad for life.

Wed, 12/30/2015 - 23:45 | 6980751 Dr. Dooms-a-lot
Dr. Dooms-a-lot's picture

Apmex had Eagles on sale today; I went in on another 20. I don't care that the price is going lower; I will buy more.

Thu, 12/31/2015 - 00:21 | 6980821 Barnaby
Barnaby's picture

Really? How do you test that much weight? (An honest question.)

Thu, 12/31/2015 - 02:00 | 6980984 I AM SULLY
I AM SULLY's picture

Utilizing Archimedes density/displacement mass test for verifying bullion, that's what I do.

This requires a proper scale and a bucket big enough to hold all of your bullion - you don't have to use water, you can also use vegetable oil or some non-corrosive liquid for volume analysis.

(that's one test)

(doesn't take long)

(just a bucket of water and a waterproof marker)

(hell - the more weight you have, the easier it is to do volume/mass testing)

Thu, 12/31/2015 - 00:06 | 6980790 Barnaby
Barnaby's picture

Fuck it, I'll just say it. There aren't enough werewolves left.

Thu, 12/31/2015 - 00:14 | 6980806 FreeNewEnergy
FreeNewEnergy's picture

Bought 50 oz. the other day at eBay, picked them up 5 10 oz bars at the PO today. Nice.

Also "bought" a human for 10 oz. I think it was a pretty good deal. Long story short, I put down two 5 oz. bars as a deposit on a vehicle to be delivered on Dec. 20. The guy (30s, all gun-crazed and conspiracy nut, so I thought, OK, he's at least not stupid) started making me nervous, missed the deadline, then wanted to make the exchange of the remainder (in cash) at a mall parking lot.

That's when I told him, deliver it here, tomorrow, or you're in breach of contract. That was the 23rd. It was a no go. And today he informed me that he's keeping my silver because, apparently, I broke the deal. So, essentially, I "own" this little cretin for 2 bars of silver. Heck, Judas sold Jesus out for 30 pieces of silver, and this guy's no Jesus, so I think I got a deal.

Had a notion to email him and say, "well, it's a good thing I gave you the fake silver. Enjoy." but I thought the better of it.

The nice thing is the bars are numbered, and I will make mention of those numbers often in various blog postings.

When somebody asks what you can buy with silver, make sure to mention, "men's souls."

Have a happy new year everyone and read up on the crime of 73. Interesting background as to why silver will always be suppressed by the rapists at the Fed.

Crime of '73 | United States history | Britannica.com

Thu, 12/31/2015 - 00:23 | 6980824 Barnaby
Barnaby's picture

Shit, I thought you were talking about The Wizard of Oz.

Thu, 12/31/2015 - 01:23 | 6980939 Manipuflation
Manipuflation's picture

I plussed you but why would you like the bars numbered?

Thu, 12/31/2015 - 05:25 | 6981121 lakecity55
lakecity55's picture

I have read where there is a market of collectors of various 'brand-named' bars. I would guess the s/n makes them higher in value. I collect a few different types myself from Silvertowne.

Thu, 12/31/2015 - 09:09 | 6981272 FreeNewEnergy
FreeNewEnergy's picture

Numbered because I can scare the crap out of this jerk by publishing the numbers in various places, claiming they're stolen (which they may well be) or gained by fraud (surely true), so he'll have to be looking over his shoulder all the time and may think twice should he ever try to sell them.

I actually think karma will deliver more justice than the courts, so I'm not going to bother going down the small claims route. Supposedly, he's moving to Florida, where he'll fit in well with all the phone and pharma scam artists.

The kid doesn't know what he's gotten himself into here. The money or the silver isn't really the matter. It really is the principle of thing. I hate liars and ripoff artists. I used to run a newspaper and exposed plenty of penny-ante crooks and some bigger ones as well.

Besides, I'm half Italian.

The other half is Sicilian.

Thu, 12/31/2015 - 02:11 | 6980959 Manipuflation
Manipuflation's picture

OK, right, whatever.  Maybe Banzai can help here.  I don't want to sign up for this photo share shit.

 

Silver is beautiful.

Peace my friends.

Thu, 12/31/2015 - 02:28 | 6981005 anaxetogrind
anaxetogrind's picture

I just don't agree....there is major deflation going on behind the scenes. USD up against commodity currencies.

Ya theres maybe a production deficit for now but so what....theres so much above ground supply that can be melted

China crashing takes out a big importer of silver

I'm waiting for $10 spot to buy ten 100oz bars

Thu, 12/31/2015 - 03:10 | 6981036 Manipuflation
Manipuflation's picture

Let me tell you something young man.  I will buy ten dollar silver until the cows come home.  I don't care and I don't need to care.  Let me tell you something.  Yes, I buy bullion but I buy numismatics as well.  What do you have to say about that?  Here is what you will say...NOTHING.  My wallet is full and yours isn't so shut the fuck up.  Go ahead and tell us what we should invest in.  I double dare you to do so.  Fuck China.  So you are are going to throw 10 K down?  No you aren't.   

Thu, 12/31/2015 - 04:09 | 6981080 anaxetogrind
anaxetogrind's picture

wow dude seriously??? was i attacking you? yes, i am waiting for 10$ to put in 10k cash into silver bars......so what?????

 

http://www.monarchpreciousmetals.com/index.php?page=shop.product_details...

Thu, 12/31/2015 - 03:28 | 6981051 Dr. Dooms-a-lot
Dr. Dooms-a-lot's picture

anaxetogrind

Forget generic bars; generic silver tracks linearly with the spot price.  I learned that lesson.  Consider buying government issued coins only.   Government issued coins increase in value over time and WTSHTF government coins will be trusted and accepted more than generic.  The last time I checked the IRS has more favorable rules for US Eagles than it does for foreign coins.  (Needs verification)   

Consider buying a bit higher, then down to $10.  At $10 the BIG players might buy the entire physical market.  They have an endless supply of paper currency to do it.  In the end when silver adjusts to market price (say 15:1) those few dollars won’t matter.

China’s crashing does not necessarily take them out of the market.  They have been selling their US Treasury Bonds and The Fed has no choice, they have to buy them or risk exposing the Ponzi scheme.  I am guessing that one weak bond auction and Ponzi is exposed.  Chyna can sell bonds, get Dollars and convert them to metal. 

Death to Ponzi!  

Thu, 12/31/2015 - 03:09 | 6981034 conraddobler
conraddobler's picture

Silver is pretty much like most commodities right now there used to be more demand than there is now and on top of this allegedly the FED is tightening up a bit.

You put those two together and the price will probably go lower.

The US demand for silver isn't world demand for silver so I don't think it makes any difference.

Silver historically languishes for a long long time after a bubble.  I sold out about 45$ of most of mine.

Will be a buyer with both fists under 10.

 

Thu, 12/31/2015 - 03:14 | 6981040 DeusHedge
DeusHedge's picture

I will admit that I don't know the dynamics of the market. However, whenever it comes to the economy collapsing, the fundamentals are what count here. A bit of history. Following the surge in everything following the .com bubble crash (well truly the very late 20th century but not technically) CEOS got a little greedy. A little tired of all the pressure imposed by the feds (well, the investment community was all ropes and lampposts back then, and the SEC wasn't budging) so they said screw it, and people still don't know what happened. Guess what happened. They imposed their will. An unjustified term in the mantra of social chaos, but definitely more than a few perquisites here. So the market was perfect, it's just that it wasn't perfect for some people. The feedback must have been awful. When the CEO's turned, not a thing was stopping their greedy little bastard dwarves. They sold, and sold, till the return on a risk-free derivitave wouldn't match the ROI of a blank piece of paper. Then, the feds decided to raise the interest rates. The overnight lending rate of the fed did impact mortages (just like the gold price will affect markets), and suddenly all those CDS's weren't worth a discussion with the trash man. So all this government intervention, and whala, perfect again. I bet this thing doesn't last past February (Martin Armstrong certainly doesn't).

Thu, 12/31/2015 - 03:16 | 6981041 Manipuflation
Manipuflation's picture

A woman has something to say.  That is a good woman.

 

Thu, 12/31/2015 - 03:34 | 6981055 blue51
blue51's picture

Wow. I think I love her.

Thu, 12/31/2015 - 03:43 | 6981064 deoldefarte
deoldefarte's picture

For those that worry about our national debt bringing us to
our knees, just chill out.
The FED will order 19, trillion dollar platinum coins from
our US Mint, then ship them to US Treasury.
Debt evaporated.

Thu, 12/31/2015 - 03:44 | 6981066 Subliminal messenger
Subliminal messenger's picture

I own precious metals for the long run, but Sprott Money has zero credibility left. Their calls:

2011: buy pms

2012: buy pms

2013: buy pms

2014: buy pms

2015: buy pms 

pms go down: buy pm

pms go up: buy pm

pms don't move: buy pm

Thu, 12/31/2015 - 09:31 | 6981316 Wow72
Wow72's picture

Try predicting a manipulated market Einstein?  Demand shows us clearly where the price "should" be going, but manipulation keeps it from getting there.  Its a long run and the thing is, if your wrong on gold going the other way once, YOUR FUCKED.

Thu, 12/31/2015 - 03:46 | 6981068 kev the bev
kev the bev's picture

I don`t know, but it seems to me pretty obvious why silver has been manipulated so much, it has to do with it being a bi-product. The majority percentage of silver comes from mining copper, zinc etc so the copper and zinc miners could care less about the price credits they get for silver, what ever price credits they get is just a bonus on top of their base metal mining. Therefore, apart from the primary silver miners, who is going to complain about the price? The manipulators could care less about primary silver miners. Silver is just too easy to manipulate. Perhaps now that the base metal miners are going out of business or producing less, this will have an impact on the silver price going forward or is this too simplistic?

Thu, 12/31/2015 - 03:52 | 6981071 Fiat agnostic
Fiat agnostic's picture

SSA could make pretty charts and argue a compelling case about any trivial aspect of PM's. I've learnt to ignore him like Polny, Swing, Turd, Organ and all the ridiculously named and always wrong perma-Bulls.

Thu, 12/31/2015 - 04:14 | 6981083 dondonsurvelo
dondonsurvelo's picture

What has changed in the silver market is the price.  It has continued on a downward trajectory no matter how many articles and charts Sprottmoney has written.  Silver will not go up in a meaningful way until all confidence is lost in the government and the economy.  There is a good possibility silver will go even lower.  The events that will move the market higher are not far off but they are not going to be soon.

Thu, 12/31/2015 - 04:30 | 6981103 foxenburg
foxenburg's picture

@dondon "The events that will move the market higher are not far off but they are not going to be soon."

That's got all the bases covered, then. 

Thu, 12/31/2015 - 04:31 | 6981104 Panic Mode
Panic Mode's picture

Some people keep saying there are high premium and low stocks in silver coins. However I never see it happened when I bought a few rounds. Still very low premium and still plenty of stocks.

Thu, 12/31/2015 - 04:52 | 6981112 theblackknight
theblackknight's picture

Not a heavy commenter here as this is a pile-driver of a site of smart people.

We know there are multiple markets, I assume we all "get" that they dance to secert songs, and we, the leftovers, are playing the ?

30 years till metal come back. Comapred to what I ask? Crickets in response. 

Buy it from me when you need it. I know that is a long way off, but you dont get mine before.

 

 

 

Thu, 12/31/2015 - 07:54 | 6981200 Manipuflation
Manipuflation's picture

Do you have any Russian coins?  Do you want to sell them?  tkufalk2@gmail.com  My goal is to have more Russian coins than anyone else including Russians.  Most Russians have never seen what I have and their brains nearly explode when I show them those coins.  I have some rare coins and they are one hell of a conversation starter.

Thu, 12/31/2015 - 05:13 | 6981119 lakecity55
lakecity55's picture

Seems to me the dealers are in the catbird seat. Yes, they bought and the price/oz went down, but all they have to do is hedge by increasing the vig (premium).

I have become more attentive to the premiums now as the price spirals down. Having bought on the way up, at the top, and on the way down, I have a good cost-average in place, but right now the best investment is in Pd or Pt. I even picked up some Rh.

The bad part is my manservant, Punjab, foolishy lost the PMs while driving the pickup truck to the lake, with the tailgate down. The PMs went off the back of the truck bed when he crossed a RR track. We went back to look, but it had been snagged.

He did not get any dinner that night, plus I made him clean all the weapons in the community bunker as punishment and move some cases of ammo back and forth.

Thu, 12/31/2015 - 05:38 | 6981124 Latitude25
Latitude25's picture

If you want to see a broken market just look at platinum

Thu, 12/31/2015 - 07:40 | 6981190 Manipuflation
Manipuflation's picture

I just looked.  I might have to buy some MOAR.  That market has been fucked up some time now.

Thu, 12/31/2015 - 06:24 | 6981143 XXL66
Thu, 12/31/2015 - 09:04 | 6981265 Manipuflation
Manipuflation's picture

Well, my Russian neighbor bought an 1896 Morgan dollar and paid $40.(Philadelphia mintage of 9.5 million...the most common for that date)  That would be OK but it is slabbed and graded by NGC at AU-55.  He was all excited about it thinking he scored.  I hated to have to tell him that he overpaid.  That coin is not worth that and likely never will be in that grade.  I didn't want to embarrass him so I lent him my blue book on US coins.  Maybe it is my fault.  I showed him that MS-65 is worth that price but NOT AU-55 and it hard to argue with NGC.  MS means mint state and that AU means about uncirculated.  That is a MAJOR difference.   He asked if I was sure.  Yeah, I am sure. 

Here is the deal just so we all know.  The red book is retail price.  The blue book is the price we might pay because it is dealer price.  Everyone likes that red book but you will NEVER see a reputable dealer pull out a red book.  If you do see that happen walk away.  Most people do not know the difference but there is a very big difference.  The red book is more popular because the prices are higher and people like to see those larger numbers but that is not the truth.  We care about looking at mintages because that is what matters the most.  Coin collecting folks are VERY particular and we know the game.  We are not going to buy FaceFuck stawks.  That is not what we do.  I can grade coins.  So can NGC and they are damned good at it.

Well, you can go buy some stawks but I won't.  I will go to the coin shop.  It is amazing how many people do not realize that there was a one dollar US gold coin at one time.  Well, there was and I have one.  Every ZHer should have one.  It just blows people's minds.  Explain this coin to me will you?  You always get people who tell you that you are full of shit.  Let's them explain what that coin means and let them dig their own hole.  You will get the, "Is it real" question.  Well, yes it is.  Now you own the situation.  That is when you can break out some of your other stuff but the gold US dollar is classic.

Just to let you know.  For an 1853 $250 is plenty for a really nice coin.  Offer $175 or less on a raw coin.  I really don't think you can go too much lower for a decent coin.  Buy the best coin you can afford.  I want to hear about how many time you shut people mouths just from showing it and asking for an explanation.  You will not regret it.

Peace.             

Thu, 12/31/2015 - 09:18 | 6981291 Spiritof42
Spiritof42's picture

I reached my quota five years ago. Unless one understands the silver market, this can be a gut wrenching time to be a contrarian. As for me, I never lost a minute of sleep over prices. 

Thu, 12/31/2015 - 09:56 | 6981381 22winmag
22winmag's picture

Man am I glad I grabbed that old schoool Johnson Matthey 100oz bar for pennies over spot back when Merit Gold was the undisputed leader in online bullion.

 

It seems that Provident is the lowest on bullion today.

Thu, 12/31/2015 - 10:50 | 6981520 sunnyside
sunnyside's picture

As a semi-literate generally uneducated peon, what of this thought/possibility? The silver ETFs had no where near the silver to back up the size of the fund.  Money is pouring in at $30/oz.  They aren't buying at that price, but just playing ponzi.  Now with the price pushed down into the teens, the ETF's are the big buyer mentioned/asked about.  They took money in at $30, are now buying it at $15 to make up the physical difference, and will pocket the rest.  Possible?

Thu, 12/31/2015 - 12:23 | 6981940 TVP
TVP's picture

"The copies of gold and silver inflated
which after the theft were thrown into the lake,
at the discovery that all is exhausted and dissipated
All scrips and bonds will be wiped out."   - Nostradamus, C8 Q28.

 

YES, he really wrote this shit.  Kinda makes current prognosticators look like a joke, eh?  

 


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