Tag Archives: SLV

Mint Suspends Silver Eagle Production – 2008 Redux?

Silver Doctors invited me on their weekly Metals & Markets program to discuss notable events unfolding in the physical precious metals markets, the meaning of the Mint suspending 2016 silver eagle production several weeks earlier than normal, the bond market blood bath and other market occurrences that are eerily similar to events which unfolded before the 2008 de facto financial market collapse.

IRD is featuring an extraordinarily undervalued gold producer in its next issue of the Mining Stock Journal (out tomorrow). The previous issue featured a sell recommendation that might surprise those who own this particular stock. It also contained trading ideas on some high quality larger cap mining stocks that will bounce back quickly when this latest take-down of the precious metals market passes (likely this week). You can subscribe to the Mining Stock Journal with this link – MSJ Subscription. All of the back-issues are included (email delivery-based).

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Gold And The Dollar Moving In Tandem?

One interesting occurrence that has not been written about in the precious metals alternative media or blog space yet is that gold has been quietly moving in tandem with the dollar over the past several trading sessions. It has been quite pronounced during the past four trading days, today inclusive. In the previous 15 years, gold’s best periods of return have occurred when gold and the dollar move in tandem higher for a brief period of time, followed by a period of time when the dollar heads south and gold continues higher.

If you look at graphs of both gold and the dollar side by side, you’ll see that this occurred in late 2005 into early 2006, when gold moved higher until May while the dollar fell and again in late 2008. It’s too early tell if that will happen now, but suffice it to say that both are moving in tandem right now and it’s worth watching to see if it continues. My theory is that there’s flight to safety into gold and the dollar ahead of an adverse economic event. As the event unfolds, the dollar begins to sell off but capital continues to flow into gold as the ultimate wealth preservation asset.

The above analysis is an excerpt from the latest issue of IRD’s Mining Stock Journal which was released last night.   Earlier today, Bill “Midas” Murphy poked his head out of the New Orleans Investment Conference and asked me why the metals were acting “so goofy” this morning, to which I replied:

Interestingly, gold and the dollar have been moving in tandem the past several days. Not perfect correlation but I bet its 80-85%. I discussed this in the latest issue of my Mining Stock Journal. Over the last 15 years, gold has had some of its best performance periods when it moved in tandem with the dollar for a bit then took off higher while the dollar sold off. It’s been moving in tandem with the dollar today as well.

The manipulated correction is over. India and China are buying a LOT of gold right now. Two days ago nearly 100 tonnes were delivered onto the SGE. I don’t think the cartel can take gold lower and I think right now they are merely trying to keep the “beachball” from popping above the surface of the water. Every time gold pops up, they hit it, but gold bounces back like one of those punching clowns.

At some point they are going to have to go back into “managed retreat.” Maybe once the election is over.

You’ll note that there’s now been a complete reversal in the precious metals sector, with gold, silver and the HUI running higher and the SPX/Dow headed south.   MSJ subscribers have been getting analysis like this since early March.  In addition, my picks have been substantially outperforming the sector. MSJ is $20/month, with no minimum commitment period.   You can access this content by clicking here:  Mining Stock Journal.

You’ve got a great journal for an amazing price  – James, happy subscriber

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As Housing Crashes, Gold Will Soar

The precious metals market is at the end of its typical mid-July to last August “breather.” This is the time of the year when the eastern hempisphere physical buyers are somewhat dormant.  Over the last several years, China’s emergence as the world’s largest gold importer has somewhat reduced the late summer seasonal sell-off.  But it’s the period of the year when it’s the easiest for the paper manipulators to push the price of gold lower.

Quite frankly, gold is up 25% since mid-December and 10% since early June.  Notwithstanding the fact that, if left alone to trade freely, gold would go parabolic for at least $700-$1000, it’s been one of the best performing asset classes YTD and can use “technical breather.”  But India is starting to flex its muscle as it heads into its biggest seasonal gold buying period of the year from right around now to mid-December.

On the other hand, the housing market is getting ready to rollover. Its already crashing in some areas (Hampton, Aspen, Miami), as noted by Investment Research Dynamic’s Short Seller’s Journal two weeks ago.   The higher end of the price spectrum is loaded with inventory in most major MSAs  and inventories in the middle and upper-middle price segments are building quickly.   July was negative month for existing home sales and mortgage applications.   The only area homes were being “sold” was in the Government’s highly manipulated new home sales report.

The Shadow of Truth discusses gold and housing  and the direction in which each is headed in its late episode:

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Powered by The Daily Coin, Investment Research Dynamics

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GLD/SLV Ponzi Scheme – GET Physical Gold/Silver

A lot of investors have invested in GLD and SLV under the mistaken assumption that they are investing in “gold.”  In the latest episode of the Shadow of Truth, we discuss why GLD/SLV are Ponzi schemes created as a mechanism to control the price of gold/silver.  We also report the latest on China’s massive investment in the new Silk Road and why it will change the world – The Daily Coin published and extensive article on this topic:  Silk Road. Investment Research Dynamics explains why the Central Banks are losing control of their precious metals price control scheme:   LINK.

Eric Sprott: As the Fed Loses Control Gold Prices Will Soar

A highly engaging and informative interview with Eric Sprott from Palisade Radio

A Massive Move In Precious Is Coming

After the collapse of Lehman and the “official” great financial crisis, gold ran up 260%, silver soared 500% and the mining shares per the HUI moved up 418% – many junior mining shares spiked up multiples of the HUI’s percentage move.

Now that the systemic problems are worse than in the middle of 2008, we believe this current move in the precious metals sector will easily exceed the move it made from 2008-2011. We are confident that the returns in PMOF since the beginning of 2016 are an appetizer that precedes the main course.  – Precious Metals Opportunity Fund quarterly investor letter

Central Banks Are Losing Control Of The Gold And Silver Trading

Note:  the current delivery-month for Comex gold is June – I absent-mindely reference July as the current gold delivery month in the podcast below.

The trading patterns in gold/silver are starting to reflect the real possibility that the Central Banks are losing their ability to use paper gold/silver derivatives a price manipulation device.  Nowhere is this more evident than on the Comex, where the ratio of paper gold/silver futures vs. the amount reported physical gold/silver available for delivery into those paper claims is at historically high levels.

Elijah Johnson of FinanceAndLiberty.com invited me on to his podcast show to discuss the precious metals market, along several other topics.  Elijah posted the portion of the show in which we specifically discuss Comex gold trading because it coincides with the strong move higher made by the metals this week.

If the CFTC passed a regulation prohibited the issuance of gold/silver Comex contracts in excess of 120% of the amount of underlying physical gold/silver it would probalby cause a doubling of the price of gold and a quadrupling in the price of silver…

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The LBMA And Comex Gold Markets Are In A State Of Collapse

missingbullionThe disappearing stock of physical gold on the Comex and the LBMA has been documented and discussed by several analysts recently, including this website.   In correlation with the disappearing physical gold is the  preposterous amount of paper gold claims issued against the dwindling supply of gold both in NY and London.

But what does it mean and where is all this gold going?

Long time precious metals market professional and analyst, David Jensen, has written a must-read analysis which explains why the explosion in the amount of paper gold and the disappearance of physical gold is transmitting the message that the NY and London bullion markets are collapsing:

Many will chuckle at the proposition of Western gold market failure and note that the price of gold has gone nowhere. If the markets are in collapse due to lack of available of gold, then where is the price action exploding to the upside? Well, digital gold and silver are still available in copious (infinite) amounts and continue to trade on both the LBMA and COMEX exchanges – you can have as much digital or virtual metal as you want on these digital exchanges. There is no shortage of virtual metal and thus the virtual price that most investors follow won’t move up. The bullion banks have always sold-down this virtual gold price when it has risen.

The telling of the story is instead in physical metal availability and so we look first to the LBMA – the primary global ‘physical’ exchange. The LBMA indicates in it owns market guide that its primary gold trading contracts, unallocated spot market contracts which are claims for spot physical gold (ownership right-here, right-now), give the holder just an unsecured claim for physical gold. This has allowed the creation and trading of non-existent gold to the point that the London spot physical gold market trades 200% of the global annual gold mine production of gold – each day.

You can read the rest of this article here:  LBMA/Comex Gold Markets In Collapse

We must not forget that when Germany, in 2013, asked for the return of 674 tonnes of their gold primarily from the Federal Reserve and some from France, they only received 5 tonnes. They were then told that they could get the rest back by 2020. They then announced that they actually received around 150 tonnes back in 2014.

But Germany has since stopped repatriating their gold, with Merkel declaring that Germany is happy holding its gold in the United States.   Egon Von Greyerz, King World News

 

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)

SoT #38, SRSRocco – Seneca’s Cliff: Greece, Debt and Paper Silver

The path to growth is gradual but the road to ruin is rapid.  – Lucius Seneca, Roman philosopher

We hosted Steve St. Angelo at the Shadow of Truth for a fascinating, if not startling, look at the big developments that look to have the west – and possibly the entire world – headed for an unexpected collapse.

When the system finally starts to unravel, the speed at which it will unravel and how it takes down the fiscal economy will be breathtaking.  – Steve St. Angelo, Shadow of Truth

There’s really no good solution.  This is the dilemma faced by every western country.  The west, including Japan and the United States, has accumulated a catastrophic level of debt in order to sustain a standard of living that is not even remotely supported by economic output.  The Greece situation is the poster-child for this dynamic.  However, make no mistake about it, the United States is Greece on steroids.

The only difference between Greece and the United States with regard to its lethal level of debt is that  1)  the U.S. has the unfettered ability to print money and create more debt in quantities needed to service its existing debt and pay ongoing expenses and 2)  the U.S. has a world-ending arsenal of nukes  – Shadow of Truth

What we are seeing occur right now going on in the market for physical gold and silver is Gresham’s Law in motion.  Bad money chases good money out of the system.  This means that anyone who is holding “bad” money – and understands it to be bad money – will take the bad money and exchange it for good money – physical gold and silver – and remove the good money from the system.  This is exactly what is occurring with massive transfer of gold and silver from the west to the east:

In the last 15-20 years, money has been funnelled out of physical things and into paper digits and assets…money stored in a safe in the form of physical gold and silver – that’s stored economic energy…Unfortunately, 99% of U.S. citizens and folks around the world took the all the excess surplus paper money [money that has been printed] and put it in “digits” and they think they’re going to get that back. And that’s the reason that gold and silver are so undervalued…and the market hasn’t realized that…Steve St. Angelo, Shadow of Truth

The mining stocks currently are more undervalued now in relation to the current price of gold and silver than they were at the beginning of the precious metals bull market in late 2000.  Many of the junior mining stocks can be bought at a stock price that equates to a few dollars per ounce of the amount of proved gold and silver they have in the ground. Every surviving company, large and small, has cut its costs to the bare bones.

When the price of gold and silver resumes its bull market trend – and we believe it has this year – the price moves will be amplified by the declining supply of mined gold and silver globally.  The increasing price will fall right to the bottom line of mining companies.  Junior miners which have “fattened” up their proved gold/silver resource base over the last four years will see their acquisition value spike significantly higher.

By the end of this year, or let’s say by September/October, I think it’s a perfect scenario for things to get out of hand. If people don’t buy silver right now, I really don’t think they’re going to be able to find it in the future.  – Steve St. Angelo