ScotiaMocatta Sells Out Of Silver Bars
Submitted by Tyler Durden on 12/31/2010 15:22 -0500
And an appropriate story to end 2010 with: ScotiaMocatta, one the world's biggest bullion banks, is now sold out of all silver bars.
Gold Trading Closes: Returning 29.7% For the Year, Doubles S&P 2010 Performance
Submitted by Tyler Durden on 12/31/2010 14:48 -0500
Some time in mid/late 2009, after becoming convinced that the stock market is a broken topological nightmare, with feedback loops that are so unpredictable to be virtually "skyNet" self-aware, and is in essence broken, we urged readers to pull all their capital from the stock market. This happened even as we grew increasingly concerned by the Fed's ongoing ruinous actions which anyone but the staunchest propaganda foot soldier realized were going to mean ongoing pain for all dilutable assets, including stocks and fiat currencies. As a result it became abundantly clear that hard assets such as gold, silver, non-nailed down park benches, bananas, hard liquor, stripper poles, and of course strippers, would outperform paper assets. Sure enough, with regard to the first, in May 2010, our skepticism about stocks was confirmed, and anyone who had limit sell orders likely ended up losing up to 40% of their capital with no recourse. Since nothing has changed in stocks, we repeat our warning that the market is at all times a few stray millisecond algos away from total meltdown. And as for gold: the 29.7% 2010 return is double that of the S&P. Which means those who did not play stocks and bought gold did ok. And even those who shorted stocks and bought gold, are still up about 15%. As above, little has changed to weaken our long-term conviction that gold (and silver, for those who can handle the added vol) is the natural antithesis to central banker lunacy. And that we will have a lot more of in 2011. Guaranteed.
Read Ted Butler's Prophetic Letter Warning Of COMEX Silver Manipulation... In 1989
Submitted by Tyler Durden on 12/31/2010 14:05 -0500
After precious metals market manipulation finally came out of the tinfoil hat closet and was officially recognized in 2010, subsequently becoming mainstream, following various whistleblowing disclosures which led to a long overdue investigation by the DOJ, and CFTC commissioners such as Bart Chilton admitting that there is in fact open market manipulation in the silver futures market by large short position holders, nobody is more relieved than Ted Butler. As the attached letter written by Butler shows, the PM expert wrote with excruciating detail everything that would subsequently be proven true. A key excerpt from the letter: "the true sorrow in this whole affair is that, in addition to the unnecessary financial punishment, the producers and owners of Silver (including the U.S. government) have experienced over the last six years, there are tens of thousands of contracts held short by innocent and unsuspecting speculators who are in for a ruinous shock. Do not be surprised, when this manipulation is attacked, to see the price of Silver open $20 per ounce higher at that time. Since that would represent a $100,000 loss on each contract held short, the current $2,000 COMEX margin will provide scant protection against the inevitable massive bankruptcies for those shorts not holding real Silver." The kicker: the letter was written on April 25, 1989.
Will Silver Be Worth More Than Gold? Perspectives On A Coming Silver Shortage
Submitted by Tyler Durden on 12/31/2010 10:35 -0500
While hardly news to regular readers, most of whom have ridden the 80%+ wave in silver in 2010, the following video from Future Money Trends explains some of the key basics about why silver, which is unique in the precious metals basket in that it is also an industrial metal (and has thus sparked much debate over whether or not it, like gold, is "money"), and provides some perspectives on why silver just may one day be more valuable than gold. Some facts: while there are 10 ounces of silver, for every ounce of gold mined, the most of it is not "free flowing" and is locked up in industrial uses; for every $1 in SLV investors still pile $7 in GLD; above ground silver has declined from 10 billion ounces in 1950 to 5-700 million ounces in 2010 (compared to an increase in above ground gold from 1 billion to 7 billion ounces); the gold to silver ratio is at 50x while the average long-term is 15x, industrial demand for silver is up 18% in 2010; and much more. Of course, there is no reason why one has to pick one or the other. Historically both have been tiered stores of value, with the Roman empire going so far as to succumb its silver currency when the going got tough. The simple fact is since global deleveraging will likely continue and since the US government will need to print trillions, most of it monetized by the Fed, the ongoing currency dilution will continue to result in increasing P prices: pretty simple. The only downside case to gold and silver holdings would involve massive asset liquidations a la September 2008, which also would mean that the Fed has lost control, that the US dollar is no longer the reserve currency, and that after the smoke settles, non-fiat currencies will rise again. And that includes both gold and silver.
