Professional Documents
Culture Documents
"In matters of style, swim with the current; in matters of principle, stand like a
rock."
Thomas Jefferson
Physical precious metals investing requires a tough skin, and an open mind
willing to grasp a much bigger picture.
It also requires the painful admission that just as the past cannot be
reincarnated - no one can predict a future that does not exist with certainty.
It is a struggle against the religion of fiat finance and the layers of myth,
folklore, and idols come and gone.
And yet, there will forever exist the group of sound money advocates who
cannot help go down the road of making price predictions.
should collapse down into the teens. Such are simply myths which are
regurgitated by the ill-informed and the willfully misleading.
The silver commercial net short position held by the 8 largest traders is
the equivalent of more than half a year of combined world annual
production - north of 220 days.
The big commercial banks have expended the equivalent of 400 million ounces
of silver opposing each step of the early 2016 price rally.
These derivatives are staggering and could never be delivered or settled.
The frantic movement of silver in to and out from the COMEX-approved
warehouse system over the last 4-5 years (first noted by Ted Butler)
has been unprecedented on a weekly and often daily basis. This is
perhaps the only way of gauging true flow of metal fulfilling promises
behind the scenes.
The scramble to source metal in a situation where a few would stand for
delivery, refusing to take paper in lieu of metal would cause the market to go
no bid.
Eligible is not metal just sitting, un-owned and therefore ready to be mobilized
on a whim.
As for the gold:silver ratio, there is a kernel of truth raised in the objection.
It isnt so much that the ratio should conform to historical patterns or parallel
mining production or demand character.
Its more about where we would be if price formation had not been dominated
by a futures market that long-ago morphed from its humble origins as a true
exchange to an unregulated house of pure speculators dominated by the
banking powers that be.
Myth functions as a concession to sometimes painful or confusing
realties. The fact that we speak of value in terms of a forced legal
tender and fiat is one such concession.
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