Tag Archives: silver shortage

The Manipulation In Silver Has Reached An Extreme

You think the silver reported as being held by the SLV ETF Trust is really all there?  Really?  I guess you’re probably expecting a visit from Santa Clause in about a month as well…Silver has been hammered by the paper market for 16 trading sessions in a row.  This is the longest losing streak in the history of silver futures trading.

The manipulation of both the metals markets and the stock market has reached proportions that would have been unfathomable before the 2008 de facto financial system collapse.  The Fed has been intervening in the markets since its inception, but the executive order signed by Reagan authorizing the Working Group on Financial Markets – a secretive subset of the U.S. Treasury Department, opened the door for the full-fledged near-continuous intervention in the markets we are now witnessing.

Clearly, there is something very wrong going on behind “the curtain” and the Fed, in conjunction with select TBTF banks and hedge funds seems to be doing whatever it takes to keep it contained and hidden from the masses.

The Doc and Eric Dubin invited me on to their weekly market Metals and Markets show to discuss these and other issues:

Is A Scandal In Paper Gold/Silver Brewing?

We should realize the suppression of the silver price is overwhelmingly a monetary problem rather than an industrial users collusion. Money creators don’t want silver as a competitor to their wealth transferring synthetic currency. So if the SUA (sounds like a hog call) went away completely and the monetary drive to hinder silver remained, we’ve made perhaps ten percent of the necessary progress. But it seems as if the SUA, better connected in its market intelligence than any silver longs, is in position to know what the megabank and central bank price suppressors know well in advance of any silver long price analysts.  – Charles Savoie, link below

Yesterday it was not widely reported that Mitsui Group’s Precious Metals Division was pulling out of the London and New York paper gold markets.  Curiously, the Company will continue its precious metals operations in Tokyo and Hong Kong.

I had suggested that this was another “signpost” of the world’s growing distrust of the massive paper leverage embedded in the Comex and the LBMA.

A good friend and business colleague emailed me a response to my post yesterday.  He is a scrap gold/silver recycler and gemologist.   He and  I worked on Wall Street together:

This is even bigger than you’re making it out to be. And I do NOT mean that snidely: combined with the Barclays and Deutsche moves, it signals that the financial center of the world is also shifting east. Not just precious metals. Pretty big statement by each of these banks, and big banks [especially Japanese big banks] don’t make moves like this without careful consideration.

I agree with Brian that this is a big statement move, especially by one of the biggest corporations in the world from a country that typically a U.S. vassal.

However, even more interestingly was the comment posted by Charles Savoie on my blog. For those of you who are relatively new (i.e. since 2008) to the precious metals world, Mr. Savoie has been around a long time and has worked with him continuously since September 2001.  In other words, he has impeccable silver market “pedigree.”    Mr. Savoie engages in “slavish” silver market research and left this comment:

The two largest members, Du Pont and Dow Chemical, members since before 1950—pulled out as of early last summer. Tiffany & Company and Ferro Corporation also withdrew. The Mitsui interests have usually also been listed. Someone is attempting to sidestep a scandal. Forgive and forget that they were members? Not in my perspective they remain culpable of collusive price suppression for several generations.

Mr. Savoie presented his cash in an article published and uploaded on the SGTReport in July:  The Silver Association Is Shrinking

Something has definitely been occurring out of sight of auditors and all other forms of accountability.  I fear that many of the widely read commentators who present analysis that is 100% reliant on the validity of what is being reported by LBMA and Comex banks are missing a much bigger event unfolding.  In fact, I believe that the true availability of deliverable physical gold/silver is considerably less than what is being reported by the western bullion banks (and the Fed, ECB, BoE).  If I’m right about this, then most of the recent commentary/analysis that has been published is highly misleading.

The elitists always drop small hints to warn us about impending disasters.  Warren Buffet warned about 9 years ago that the U.S. was in danger of becoming a nation of serfs.   Right now over 50% of the country is dependent on some form of Government transfer payment and nearly 1 in 6 people receive food stamps…I would suggest hat the recent withdrawal of highly prominent banks from the London and NY paper bullion markets is another “hint” of a brewing catastrophe.

On the Comex the paper to deliverable gold ratio has spiked up to the horrifying ratio of 200:1.  We can only guess at the true paper to physical ratio of gold in London.  Of course, that 200:1 ratio is a guess as well unless you are naive enough to believe the bank-issued Comex inventory reports.

Yes, indeed, a scandal is brewing.  And it looks like several rats are folding their hands and running for the exits…

Is Japan “Inc.” Pulling Out Of The Comex And LBMA?

One of Japan’s largest global precious metals trading companies, Mitsui Precious Metals, is closing down its operations in New York and London by the end of 2015.  Note that it will maintain its operations in Tokyo and Hong Kong – interestingly:   Mitsui Pulls Out Of NY, London.

Mitsui is one of the largest business groups in Japan and one of the largest corporations in the world.  “When in doubt, pull out.”  In my view, this move reinforces the growing global fear of the massive paper to physical gold/silver leverage embedded in the NY/London banking system.

Remember, we are able to assess only what might be available to back visibly traded paper gold and silver derivatives (Comex futures, LBMA forwards).  And reported inventories are based on reports submitted by the bullion banks and Central Banks.  Do any of us really trust these bank reports as reported without visual confirmation and independent audits?

In fact, I will go as far to say that any analyst in this sector who presents any analysis and commentary based on bank-generated gold/silver inventory reports that does not stipulate up front that any and all information is based on reports that may or may not be accurate is thereby presenting invalid analysis.

missingbullionAnd, too be sure, all analysis that can be reasonably issued in entirely incomplete because it is impossible to assess the realistic exposure of OTC precious metals derivatives.   Even the banks who issue these opaque securities likely are in the dark.

I would suggest that Mitsui’s move pull out of the NY and London – thereby joining Deutsche Bank and Barclays – is symbolic of the world’s increasing perception that the New York and London financial markets are the biggest Ponzi schemes in history.  At the very least, it suggests that the world of growing weary of the fraudulent paper gold and silver markets on the Comex and the LBMA.

 

Is Silver Intentionally Being Drained And Diverted From The Retail System?

One of the rules by which the elite aristocrats abide is they consider it rude to not issue a warning before they do something bad to us. They’re like criminals with manners. In other words, it’s gauche to flush the toilet while the serfs are in the shower without giving a “heads up.” – John Titus, Best Evidence

I want to preface this post with the stipulation that it is, at this point, only a theory that may be completely off-the-rails.  But, then again, it might be simplistic enough to meet the requisite  explanative demands of Occam’s Razor.

Most commentators and bloggers do a fine job regurgitating and repackaging information and developments which have already become obvious.  But the large majority refuse to take the analytic and intellectual risks required to advance ideas based on “tracks in the snow.”  Or they may just not see or be aware of the “tracks” that have appeared.

I know that since it became clear to me in late 2001 that the U.S. population was under “attack” by the wealthy, power-hungry elitists who have gained control the system, I have been able to see how the economic, financial and political collapse of the U.S. was going to unfold with a fair amount of clarity by applying this think-like-a-criminal algorithm:  “what would I do next if I were a criminal that could operate unshackled from Rule of Law?”

Let’s start peeling this onion with two possible motives.  The simplest explanation for the retail shortage of silver, which is growing more severe by the day and is occurring in several locations globally (U.S., UK, Australia, Hong Kong, just to name a few from which I’ve received detailed reader accounts), is that the wholesale stockpiles are diminishing to the point at which the holders of massive paper short positions risk running out of bars to deliver to the entities holding the long side of short positions.

This wouldn’t be a Comex-specific issue, because very little metal is delivered on the Comex.  This would be an LBMA and OTC derivatives issue.  It’s one thing if there’s not enough silver to keep the mint supplied.  This just causes anger and angst among the tiny percentage of hoi polloi trying to convert their fiat money into real money.  No big deal from the Government’s point of view. (Note:  the argument that there’s production capacity issues at the refiners who supply silver blanks to the mints is disingenuous beyond the point of silliness).

But its an entirely different issue if there’s a major delivery default to strategic/industrial users and uber-wealthy barons in India, China and the Gulf State Countries.  If word leaked out of a default on that level, the price of would silver launch into orbit and the exorbitant paper short position put on by the bullion banks would incinerate the TBTF banks.

We know the “registered” silver vaults on the Comex started dropping fast in mid-March – click to enlarge:

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But where is this silver going?  We also know that indications of retail shortages started appearing late-June, followed by an announcement from the mint that it was halting production and sales of silver eagles. The halt was remedied about three weeks later.

For the record, the mint announced a 20% cut-back in silver eagle production in August and another 20% cut-back in production on September 15:  US Mint Choking On Silver Shortage 

This suggests to me that domestically held silver in the United States is needed elsewhere to extinguish supply “fires” and the U.S. citizens can “eat cake” instead.  This would explain the sudden jump in U.S. silver exports to India, first discovered by SRSRocco LINK, in May and June.   If the the mint needs silver to produce enough silver eagles to meet retail demand, why is this silver being sold to India?

By law – this “law” was written in an era when the elitists were somewhat constrained by Rule of Law – the U.S. mint is required to produce enough silver to meet demand.   If silver that could be used to stamp silver eagles to meet demand is being exported to India – in the context of the registered silver stock at the Comex dropping like a dead fly, it suggests  perhaps  that the authorities are intentionally draining the retail silver distribution system in the U.S in order to meet demand obligations offshore.

Thus the first possible motive for draining the retail system of silver is, simply, that the silver is needed elsewhere, with adverse consequences if the silver is not delivered.

The second motive is substantially more insidious – and some might say “conspiratorial” – but equally as possible as the first motive.  Recall that there’s been discussion of eliminating physical cash currency and converting the western currency system into a digital currency system.  In fact, several somewhat influential Keynesian-influenced criminals economists have expressed strong support for this idea.

This falls into the “the elitists like to issue a warning before they do something bad to the population” category from the quote at the top.

The reason for draining silver from the system is that it represents a threat to the plan for imposing upon us an electronic fiat currency system.  Silver was actually used as a currency before gold.  Over time, silver became known as “poor man’s gold” because of the low worth per ounce relative to gold.  But because of its low relative worth, an ounce of silver is more fungible for everyday use a currency.   For these reasons, the sale of silver mint coins exceeds the sale of gold coins by about a 100:1 ratio.

If a large enough percentage of the population holds silver in large enough quantities, it is quite possible that the use of silver and gold would develop and an “underground economy” alternative to the digital fiat currency system being contemplated.   As long as only a small percentage of the population owns gold and silver, the Government can still impose control over the currency system and therefore the entire system without any threat of a black market alternative currency system based on metal.

Please recall that Paul Volker has said that it was a mistake for the Fed to control the price of gold when the U.S. dollar was devalued against the yen in 1973.  Furthermore, he recently referred to gold as “the enemy.”  And make no mistake, the prolific amount of anti-gold propaganda in the media this year is the Fed/Government’s premeditated and calculated effort to vilify gold as little more than “a Pet Rock” and thereby aggressively discourage the public from thinking about gold/silver as an investment.

If the Government can drain as much gold and silver from ready-access by the public at-large before a much larger percentage of the population understands gold’s value as vital protection against ongoing rampant currency devaluation, then the Government can avoid imposing the overt totalitarian measure of confiscating gold, like FDR did in 1933.

In short, the Government needs to remove gold and silver from the U.S. economic system in order to eliminate precious metals a competitive alternative to the plan for imposing an digital currency system on the country.

One last point, when I see  dubious representatives of institutions like the Perth Mint disingenuously attempting to dispel the fact there’s a silver shortage with long articles loaded with half-truths, distorted truths and willful omission of facts, I begin to suspect that the shortage is worse than is known.  This is true regardless of whether or not the two theories proposed above hold true.

Anyone Who Believes The Comex Numbers Is Very Naive

“The information in this report is taken from sources believed to be reliable; however, the Commodity Exchange, Inc. disclaims all liability whatsoever with regard to its accuracy or completeness. This report is produced for information purposes only.” – disclaimer now posted on the Comex gold and silver daily warehouse stock report as of Monday, June 3, 2013 – Investment Research Dynamics – June 4, 2013

Yesterday I published an article detailing the Comex gold futures to deliverable physical gold ratio that is now north of 200:1.  But an erudite colleague of mine, John Titus of “Best Evidence,” correctly pointed out that:  “They are probably bluffing.  In other words, the real number is significantly higher than 200:1.

For the record, John does more thorough research on the economic numbers and reports that he studies than anyone I’ve ever come across.  And he does it with the trained analytic eye of a seasoned patent litigation attorney.

Let’s put everything in perspective.  The numerical reports from which fancy graphs and and dry detailed data presentations are created originate from the Too Big To Fail Banks. I’ve said for quite some time that IF the bullion banks who control the Comex and the LBMA are submitting honest data reports for the Comex and LBMA, it would be the only business line in which they do not hide the truth and report fraudulent numbers.  What is the probability of that?

JP Morgan was recently caught stuffing proprietary Comex futures short-sell trades into the “Managed Money” account category of the COT report.  The CFTC scolded JPM and slapped them with a whopping $650,000 – LINK.    Does anyone really believe that the CFTC wrist-slapping corrected any fraudulent data reporting by the likes of JP Morgan?  Really?

Put your “think like a criminal hat” on for a moment.  You know that the people who care about this sort of thing already know that the there’s a paper vs. physical problem in the market.  So just show them a number that they’ll buy into and that will be “the number.” Most analysts will accept that number at face value and use that in their articles and blog posts.  That number then becomes accepted in goldbug circles as the “real” number.

But the truth of the matter is that they are more than likely reporting numbers they want us to see, not the real numbers.  For instance, the silver market is now seizing up from lack of supply.  Please see this report from Greg Hunter and David Morgan if you are still skeptical:   Retail Silver Has Seized Up.

Yet, the Comex bank custodians are reporting over 51 million ounces of silver available fore delivery – LINK.  In fact, CNT – an official supplier to the U.S. mint – is showing 13.3 million ounces of deliverable silver.   So why is there’s a shortage of silver at the U.S. mint? IF that silver were actually in the vault, the U.S. mint could buy a spot contract – September has a silver contract open – and take immediate delivery.  

Also, why did the CME, unannounced, start slipping that little accuracy disclaimer into its daily gold and silver inventory reports in 2013?   I’ll let you draw your own conclusion about the truth.

The silver market is seizing up which means that there’s a severe shortage of silver available.  It is also showing up in the LBMA wholesale market based on the backwardation in gold and silver forward contracts that have been observed for several weeks.  It means that any visible inventories reports from ETFs and Comex/LBMA banks custodial vaults are fraudulent.  That includes SLV reports.

It also means that the recent discovery that the LBMA altered its gold refining flow statistics, revising what was originally reported to be 6,601 tonnes of gold cleared by the LBMA in 2013 down by 2,000 tonnes to 4600 tonnes, are likely off the mark.  That’s a big miss, given that the total global mine production annually is around 2500 tonnes.

The significance of this is that it’s easier to explain how 4600 tonnes of gold was refined into bars and sent to Asia than 6600 tonnes, given that the total global supply of gold from mine production + scrap production was reported to be slightly more than 3000 tonnes.

From where did that extra 1600 tonnes come?  The REAL question is, from where did the extra 2600 tonnes come if we use the original number?  And is the 6600 tonne number a good number?  Was the real number even higher?

The obvious conclusion is that the supply deficits in gold and silver are being remedied by hypothecating gold and silver bars from allocated accounts held at bullion banks, including the accounts held in behalf of the gold/silver ETFs,  like GLD and SLV.  This is why ABN Amro and Rabobank stopped allowing their physical gold account investors to take physical delivery of the gold they thought they have invested in – the gold was not there to deliver.  This also occurred in 2013.

Now for the final blow to any skeptics.  You’ll note that the LBMA revised down the amount of gold it cleared from refineries in 2013.   But you’ll also note that the Comex inventory report disclaimer at the top of this post was first inserted into the daily Comex inventory reports in June 2013.  See any coincidences?  Bueller…

Bill Murphy and GATA have maintained for years that the fraud and corruption in the precious metals market would eventually be revealed as the biggest financial fraud scheme in history.  It would seem that the cracks in the wall of this scheme are growing wider and it’s becoming easier to see rays of truth.

History tells us that all Ponzi schemes and market interventions fail.   I believe we are on the cusp of a massive failure in the scheme to cover up the truth about the precious metals market.

Silver Shortage Update: Another Delay From Apmex

There has to be a big problem in the financial system coming that the Fed knows about but we can’t see it yet. Why?  The behavior of the Fed and its ECB/BOE cohorts with respect to the paper gold/silver market conveys a sense of terror on their part.

We learned yesterday from an “official” source, Reuters believe it or not (Reuters has furiously been spreading anti-gold propaganda ), that India is on track to import 900-1000 tonnes of gold this year.  This does not take into account smuggled gold which is estimated to be another 25%.   India alone, it seems, will inhale 50% of the amount of gold produced in a year.

Then there’s China…China it’s hard to say for sure.  If you go by Hong Kong exports into China, it only captures a portion of China’s gold demand.  If you go by Shanghai Gold Exchange Withdrawals, China is on track to scoop up over 2000 tonnes of gold this year.

China + India combined are going to import at least 30% more than the total amount of gold produced in a year.  Both India and China are entering their seasonally strongest period of gold buying, which will last through the end of the year.

Then there’s silver.  By all apparent market indications, there is a serious shortage of silver that has developed, at least at the retail level.  Although charlatans from down under who avoided taking economics  in undergrad seem to think the 1000 oz Comex bar market is the bellweather, I would like to see a bona fide independent audit of the inventory reportedly being held in Comex vaults.  Note:  those reports are prepared by the banks – do you trust them?

Premiums on silver products in the U.S. have widened to levels not seen since 2008, when silver eagle premiums approached 100%.  Currently, my “bellweather” indicator is Apmex. The premiums on 500 oz monster boxes have widened today to $3.79 over spot.  This is the lowest premium product and it’s 27% over spot.  If you want to buy just one mint roll of 20, you will have to pay $5.75 over spot, or a 41% premium.

But it’s worse, certain products are not available.  We know 90% bags of coins are not available, although they can be had in onesies and twosies for about $7 over spot.  But a friend of mine ordered a 100 unit gold gram product from Apmex and was notified this morning that there is “a delay in processing” his order.  In the past he said shipment was immediate.  This particular product is minted by Valcombi and is a “tear away” sheet of 100, 1 gram units.  It’s perfect for preppers who seek fungability.  And now there’s a shortage of them…

Base on all the evidence from the physical market – and there’s a lot more evidence of shortages in silver – how do we explain the behavior of the price of gold and in the paper market?   Here’s two graphs of the trading in paper gold and silver – click to enlarge:

GOLD:                                                                                         SILVER:

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This type of price action that can only occur by the exertion of an exogenous outside force. In this case it’s the western Central Banks and, specifically, the NY Fed in conjunction with the Treasury’s Working Group on Financial Markets’ Exchange Stabilization Fund.  The decline in the price of gold and silver nearly every night for the past four years seems to occur primarily only in the NY/London paper markets.

Certainly everyone by now knows that the Plunge Protection Team is working overtime to keep the U.S. stock market from collapsing. And it is also exerting at least as much effort, and probably more, in keeping the price of gold and silver from exploding.

For now, the banks are finding enough physical gold and silver to keep the Indians and Chinese happy.   My best guess is that the GLD, SLV, and the Comex and LBMA custodial vaults are being looted for this purpose. The U.S. retail market is another matter – it’s mind over matter: the Fed doesn’t mind and they don’t matter – for now.

But this will become problematic once those sources are tapped. If you think you have bars being kept in the non-bank vaults on Comex (Brinks, CNT, Delaware Depository and Manfra, Tordella) I would suggest paying a personal visit and verify serial numbers. And then leave with your bars in hand.

If you are looking to buy silver from a big U.S. internet-based dealer in order to minimize the premium you pay, I would suggest instead taking your fiat cash and buying from a local dealer. At least you can guarantee that you will have the product in hand when you tender payment. Otherwise you risk seeing this in your email tomorrow:

Thank for your recent order xxxxxxxx. While processing your order, we encountered a short delay. APMEX strives to ship every order as quickly as possible, but in rare cases order processing may take longer than expected. (Apmex)

Gold Vs. The U.S. Dollar: The Big Lie

Under the gold standard, a free banking system stands as the protector of an economy’s stability and balanced growth. When gold is accepted as the medium of exchange by most or all nations, an unhampered free international gold standard serves to foster a world-wide division of labor and the broadest international trade. Even though the units of exchange (the dollar, the pound, the franc, etc.) differ from country to country, when all are defined in terms of gold the economies of the different countries act as one.  – Alan Greenspan, “Gold and Economic Freedom,” 1966

I don’t know if the Plunge Protection Team will be able to stabilize and bounce the market today.  I suspect they will get it done sometime in the next 24-48 hours – there’s real blood money at stake here.   By this I mean there’s still a lot of middle class wealth that has not been wiped off the table and into the pockets of the elitists.  Hell, Hillary Clinton is still standing – for now.

But at some point our system will collapse.  EVERYONE in this country has been living off the benefits of The Big Lie for too long.  It’s not just the upper .1% who have benefited, even the welfare programs have been levitated by the U.S. Government’s ability to bamboozle the rest of the world into buying our debt and accepting our currency.

When the rest of the world flinched at taking down more debt, the Fed printed trillions to buy U.S. Treasuries directly, and lent $100’s of millions to the Bank of Japan and the ECB to enable them indirectly to continue propping up the Big Lie.

But today gives us  a glimpse of The Truth.  Beneath the headlines of plunging stock markets, and not being reported by the U.S. financial muppets, is a stunning 1.5% plunge overnight in the U.S. dollar:

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At the same time, the world’s oldest currency – the Wall Street Journal’s “Pet Rock” – has performed as the ultimate flight to safety today:

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While the “Einsteins” out there offered only the obvious explanations for China’s move to devalue the yuan, I have maintained all along that it was first and foremost a means of tossing a “grenade” at the massively unprecedented U.S. dollar bubble. It only took a about 3% move to accomplish this.

Meanwhile, here’s what’s really happening in China:

Shanghai gold withdrawals for the week ending Aug 14th have been reported at 65.013 tonnes (previous week 56.015 tonnes). This brings the year to date total to 1,585 tonnes, 161 tonnes more than in the record 2013 year at the same time.  – John Brimlow’s “Gold Jottings”

The Fed kept insisting that it would raise rates in September. For anyone willing to look honestly at the underlying economic evidence, it was obvious – OBVIOUS – that the Fed would never raise rates. It was nothing but Orwellian smoke. Keep repeating a lie until almost everyone wants to believe it.

I heard a radio promo yesterday for a mortgage broker who insisted that “rates are definitely going higher later this year so you better take out as big of a mortgage as you can now and buy your dream house.”

Rates may go higher this year, but if they they do it’s because the dollar is collapsing – or even vanishing – as the rest of the world other than the Bank of Japan and the ECB rush for the exists with their Treasury holdings.

The Big Lie is that gold is a Pet Rock and the U.S. dollar is the global flight-to-safety currency of the world. If that’s the case, then how come China seems to be cornering the market in Pet Rocks while dumping the dollar through that exit door at the back of the movie theater?

SoT – Market Update – Special Guest Kim McAvoy: Vox Populi

What’s happening now is all just fluff compared to what’s going to happen.  – Kim McAvoy, voice of the people on Shadow of Truth

It’s beginning to look like the beginning of the end.  Some sort of motivation beyond what’s obvious prompted China to start devaluing the yuan and further remove the yuan’s peg to the dollar.  This seems to be the end of the long road that has been traveled by the proverbial “kicked” can.

In turn the yuan devaluation event seems to have undermined the Fed’s ability to keep the S&P 500 propped and bubbly.  After the last three days of selling on the NYSE it looks like real fear may have finally gripped the system.  Today (Thursday, August 20) looked particularly ugly, as the Fed was unable to keep the S&P 500 from falling hard despite several attempts to jump start a rally.

Similarly, gold has had an impressive 11-day run in which it’s rallied over 6%.   Not too bad for something Rupert Murdoch’s “Wall Street Journal” referenced as being analogous to a Pet Rock.  While the mainstream media apologists and analytic charlatans will attribute gold’s move to “short covering,”  we believe the fundamental driver of this rally has the unmistakable odor of “flight to safety.”

We hosted a special guest on the latest Shadow of Truth “Market Update.”  After exchanging a series of emails with her, we got to know Kim and wanted to host someone who could represent “the man on the street” voice.  As Rory stated:

I think it’s important for people – in particular people that are new [to the world of truthseeking[ to hear what real live people are doing; not just from you and I – everybody can hear what you and I are doing. Let’s hear from somebody who nobody knows and is out there making it happen [seeking facts and preparing for what’s coming].

SoT #53 – Doc @ Silver Doctors: Retail Silver Supplies Are Disappearing

People also need to recognize that the gold and silver shortage is real. We’ve got the Royal Canadian Mint, for example, not being able to supply silver coins without a lengthy time delay…Eric, you and I believe the metals are headed for a complete turnaround that’s going to astonish everybody. If we look at the 90 percent junk silver bags. I deal with one of the largest companies in the world and what we are seeing is what I call ‘The 90 percent factor.’ Historically, when gold and silver are set for an explosive move, 90 percent bags become virtually unavailable.

When the biggest suppliers in the industry, and I’m talking directly with two of them, are saying ‘We can’t even get 90 percent bags and we probably won’t be able to fulfill any order for at least 8 – 12 weeks on those,’ you know we have serious supply problems. So 90 percent bags are virtually unavailable at these prices and those who are primary dealers in them can’t even acquire them.   – Steve Quayle on King World News

The Federal Reserve and the bullion banks are now blatantly manipulating the price of gold and silver using paper gold and silver, which can be printed in unlimited supply.  They no longer try to hide or disguise their operation and certainly never deny that they are constantly intervening in every market – not just the precious metals – in order to disrupt and prevent the valid price discovery mechanism of free markets.

I’ve always said that 90% bags are the leading indicator of impending market shortages…we saw that the week before the big smash-down in the silver price the first week of July, when premiums on 90% bags spiked.  Then around July 6th or 7th,  90% bags went “no offer” at the largest market maker of 90% bags in the U.S. at the wholesale level.  And it’s been “no offer” ever since. – Doc from Silver Doctors on Shadow of Truth

I used the quote at the top because it independently confirms everything we heard from Doc at Silver Doctors today, who told us that across the product spectrum silver coins are selling out at the wholesale level.  The only reason this can be occurring is because there’s a shortage of unrefined silver that has developed globally.

The U.S. mint production has been going down about 20% per week. The first week they resumed sales the total allocated to authorized dealers was 1.4 million coins, the next week it went down to 1 million, last week it was down another 20% and I haven’t heard the number yet for this week. The Royal Canadian Mint didn’t take any orders last week and they’re not advising when they’ll resume taking orders for maples.  – Doc

China and India are primarily attributed with importing most if not all of the annual mined supply of gold for the past couple of years and both are on track to import a record amount this year. But very little is mentioned about their silver consumption. India is on track to import a record amount of silver and China is using all of its internally mined silver to supply its massive solar program (see this SoT podcast:  Solar Energy Drives Silver Demand).

The reason it’s important to understand the retail demand function for silver is because, at the margin, it will be the retail investors who will “tip the scale” on the Government’s silver manipulation operation and force shortages that will overwhelm the naked paper short interest, both on the Comex/LBMA and in the OTC derivatives market.

Rory and I visited with Doc today because we wanted to hear first-hand about what he’s seeing in the markets which feed into the retail supply for silver investment products.   The only time premiums across the board for retail silver products were higher than they are right now was during the 2008 take-down of gold and silver. There were a lot less retail participants back then, which means that the current market has been set-up to become even more extreme than it was in 2008.

Of course, do not overlook the fact that the price take-down and shortage of metals back then preceded the Great Financial Collapse, because we know that current fundamental conditions are worse than they were in the period leading up the de facto collapse of the financial system.