The Golden Truth: Sunday Quickie On Silver

Sunday, July 18, 2010

Sunday Quickie On Silver

A massive quantity of silver has been withdrawn from the Comex over the past month or so. On Thursday, the latest day for which data is made available, close to another million ounces was removed. Most of this silver is coming out of the "eligible" inventory. This is the inventory that belongs to private investors who are using the Comex as a depository. Some of these investors keep it there to make it convenient to re-sell on the Comex and some for convenience until they decide to take actual possession.

The total Comex silver inventory - at least the inventory which is being "reported" by the Comex - is down to 110 million ounces. I have seen the inventory this low, but it's been a long time. There is still about 3.5 million ounces worth of July silver contracts standing for delivery. This is an unusually large amount at this stage in the delivery cycle. There is no question in my mind that last week's massive paper manipulation of silver on the Comex was an attempt by JP Morgan, et al to try and shake loose a lot of those standing contracts. My bet is most the holders understand the drill and will take delivery anyway, because a year from now a $1 either way on the price of silver will be insignificant if silver does what a lot of us believe it will do.

Two questions come to mind: 1) Why are the Comex counterparties dragging their feet on delivering that 3.5 million ounces? 2) Why are an unusually large number of private investors removing their silver from Comex depositories? To be sure, in my mind these questions are strictly rhetorical. But I would suggest that anyone thinking about accumulating some silver for protection from what's coming should do so as soon as possible. To paraphrase Eric Sprott: One day you will wake up and decide to take delivery of your gold/(silver) only to find that it's not there to be delivered.

10 comments:

ClarkSunday, 18 July, 2010
Dave--I've managed to accumulate a little silver over the past few years, and am grateful for what I have. I'll bet that the COMEX is very worried about the withdrawals, if these sociopathic swine can worry. One worry I have is that I saw that there's an amendment in Dodd-Frank (hereinafter, simply "D-F", and please freely make substitutions in the acronym) that purportedly amends the Bank Secrecy Act to require buyers/sellers of Au/Ag in amounts over $600 (!) to report the transaction to the IRS. I hope that this is not true, but I suspect that it is.
Thanks for your blog.
Clark in Old Hickory
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HopiumSunday, 18 July, 2010
I was talking to a Sheeple friend of mine the other day ( who thinks we are in a recovery ) about Silver and his reply was.. " Why would I want to buy Jewelry?

I want to tell you my secret.

I see Bag-holders.
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BillSunday, 18 July, 2010
http://www.zerohedge.com/article/rust-discovered-bank-russia-issued-999-gold-coins

Lol
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HopiumSunday, 18 July, 2010
http://www.theglobeandmail.com/news/national/christie-blatchford/an-unkind-complicatedness/article1643419/

Sorry for the double post Dave this coincides with your post.
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Dave in DenverSunday, 18 July, 2010
Hey Clark. How's it going? That legislation is indeed true. But it's simple. Eventually we will be using gold/silver for the exchange of goods and services. That's why silver and gold fractionals are practical. But b4 that becomes commonplace, if you need to sell some metal, you can sell it on craigslist or ebay privately. The key to life right now is getting used to operating outside the system as much as possible.
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Dave in DenverSunday, 18 July, 2010
thanks for links Bill, Hopium!
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MikeSunday, 18 July, 2010
Dave in Denver

i remember you mentioned you were going to do a piece on Bullion Management Group and Bank of Nova Scotia about their supposed gold/silver holdings at the Nova Scotia vault when the hole Harvey Organ issue occured some months ago. here is an interesting link in the local Toronto paper on BNS about silver delivery using certificates.

http://gata.org/node/8837
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Dave in DenverSunday, 18 July, 2010
good god. that story is horrifying. i got kind of lazy on the idea of doing a piece on BMG and Scotia. part of it had to do with my thinking that not enough people give a shit and those that do already understand and know the truth.

I may turn that article in a quick blog tomorrow. thanks for the link.

there will be a an "event" that will blow this whole thing wide open. stay tuned.
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Dave in ChicagoSunday, 18 July, 2010
Dave, always enjoy your piece's. I've been accumulating coins, bullion, and silver bars now for over a year. I'm getting ready for the collapse, too bad very few people believe me or are too busy with their daily life's to even care. Thanks for keeping us informed.
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Dave in DenverMonday, 19 July, 2010
Thanks for the feedback Dave, I really appreciate it. People in general have no idea how to close to collapse we are.

It was funny because I had dinner Sat night w/some old friends (who are upside-down on their mortgage) and my buddy's wife said: "you know 8 years ago when you started talking what would happen in this country we all thought you were nuts. But you've been right about everything. What's gonna happen next?" I said "you don't want to know what I think and I hope I'm wrong" LOL
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Why Gold?

Gold is the world's oldest currency. You exchange your fiat currency (dollars, euros, yen, yuan) into gold as an insurance policy against catastrophic Central Bank and Government policies which serve to destroy the value of fiat currencies and destroy democracy.

Gold can ONLY be considered an investment to the extent that it remains significantly and historically undervalued in relation to the fiat currencies against which its value is measured. Otherwise it remains the world's oldest currency and is completely free from the counterparty risk associated with currency by Government fiat (i.e. fiat currencies rely on a Government's "full faith and credit.")

Quote Of The Month Courtesy of "Jesse"

Unfortunately for Larry Summers, Ben Bernanke, and their friends at the BIS, they have not yet figured out how to print physical gold, silver, and other essential commodities, and the world is reaching the point where it might simply start ignoring the New York based markets with respect to essential commodities such as basic materials, oil, foodstuffs, and the like, as they become increasingly irrelevant, fraudulent, and Orwellian. And then where will the financial engineers be, except with no more excuses and no place to hide?

Here is the link to his entire commentary, well worth a read:

http://jessescrossroadscafe.blogspot.com/2010/07/gold-daily-chart-shock-and-awe-for.html

Great Quote From Jim Rogers On Govt CPI Reporting

JR: I mean, we have inflation now. If you go to the shop, whether it’s groceries, or education or insurance or health care, prices are going up for everything. The government lies about it in the US. Some countries lie, many countries don’t: Australia, China, India and Norway. Many countries don’t lie about it and acknowledge that we have inflation. Others lie about it, the UK and the US, but if you go shopping you know prices are up.

Q: Are you saying that the American Consumer Price Index (CPI) published by the US Bureau of Labor Statistics is a lie?

JR: In my opinion, yes, of course it is. Have you looked at it? They’ve changed their accounting several times in the past few decades. When housing was 20% to 25% of the CPI and housing was going up, they didn’t count it, saying rents weren’t going up, and then when home prices started going down, they counted it. It’s the same with many things. It’s staggering some of the tortuous reasoning that the BLS has used over the past 25 or 30 years. When the price of gasoline goes up, they say it’s not really going up because it’s better gasoline, better quality, therefore you’re getting more for your money. I mean, it’s endless, the stuff that they say and for some reason people sit there, although more and more people are catching on, and accept what the government says.

source: www.clusterstock.com

Quote of the Week

"The primary function of a Central Bank is to engage in the massive transfer of wealth from the middle class to the wealthy elite. The Federal Reserve was set up to do this with the blessing and support of Congress." - Dave in Denver

If you refuse to believe the above, please read "The Creature From Jekyll Island: A Second Look at the Federal Reserve" by G. Edward Griffin and then explain to me why the Senate voted down the Vitter Amendment and Congress refuses to pass a law requiring a full audit of the Fed, even though the Fed is using taxpayer-backed money to bailout Wall Street and Europe.