Something’s Wrong in the Silver Pit: But It’s Much Bigger than J.P. Morgan

When researching the precious metals, often times things are seldom as they appear on the surface.  GATA Secretary and Treasurer – Chris Powell – has said that the true picture of a nations’ gold holdings are, “more closely guarded than their nuclear secrets”.

This has been more-or-less proven true based on the Federal Reserve’s reaction to GATA’s 2009 FOIA request for information concerning GOLD SWAPS. The Fed is ON RECORD admitting they’ve done gold swaps – which, by definition, necessarily utilize sovereign American gold stocks.

To date, the Federal Reserve has stonewalled GATA’s FOIA request citing their ‘privileged status’ and reluctance to divulge ‘trade secrets’.

GATA has maintained that the Federal Reserve / U.S. Treasury in conjunction with other Central Banks have for years been suppressing the price of gold [and silver too] – in efforts to mitigate and to cover up their own debasement of fiat currencies. 

Historically, when Central Banks or governments print more and more fiat money, precious metals prices RISE.  The money printing is not only inflationary but when done to excess it can undermine confidence in faith based fiat currency regimes.  Precious metal has no counterparty risk and cannot be printed – which is why it “is” and always will be money.  Remember folks, gold is money, as evidenced by EVERY Central Bank in the world listing gold bullion on their balance sheet as an official reserve asset.

GATA has identified and documented that Central Banks utilize precious metals derivatives, and in particular swaps, as a primary method by with Central Banks rig metal prices. 

[continued]

http://news.silverseek.com/SilverSeek/1292004828.php

James Turk - $400 Silver by 2013 to 2015

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2010/11/16_James_Turk_-_$400_Silver_by_2013_to_2015.html

With Comex increasing margin requirements for a second time so quickly, King World News interviewed James Turk today out of Spain.  Turk commented, “This may explain why Comex is raising margins a second time so quickly, they aim to put more pressure on the buyers.  Obviously the Comex is trying to put more pressure on market participants by forcing them to liquidate their longs.”  
 

Turk continues:

“Eric, here we are at $25.50 which is the price that was identified by your London source last week.  So they painted the tape, but the Comex open interest shows that they haven’t driven out any buyers which is very surprising.  Normally you would expect to see some longs liquidating on any pullback like the one that we have seen over the past few days, but that hasn’t happened this time around.

The buying pressure in the physical market remains, we are starting to see the industrial buyers coming back in to secure supply.  My guess Eric is that the industrial users will be there on any price dip like we have had at present.  Up to this point we haven’t seen the boomerang effect that I have been anticipating but I am still expecting a sharp snap back in prices.

As we pointed out in the piece which had Mark Lundeen’s illustration in it, gold is dramatically undervalued and this can only result in much, much higher prices over time.  I would just add that I expect the gold/silver ratio to decline over time to under 20 to 1, so silver will be exploding along with the price of gold.

As you know Eric I have been projecting gold to hit $8,000 by 2013 to 2015, so that would equate to silver hitting $400, and that is well within the realm of possibility as silver reverts back to its historical mean.”

This is what happens in bull markets, prices climb to levels that previously seemed unimaginable.

The Day The Silver Suppression Stopped How To Navigate The New Silver Market

The Golden Economizer
November 11, 2010

Tuesday was a landmark day in Silver Metal Trading in the United States. Trading action this day clearly indicates to those attuned to the Silver Market that the long term price manipulators have finally lost control over the price of Silver Futures Contracts on the COMEX, and thus over Physical Silver Metal as well. Who are these manipulators? The largest are undoubtedly JP Morgan Chase and HSBC who have recently been indicted in a class action suit in connection with an alleged conspiracy to manipulate silver futures and options contracts on the COMEX. Unfortunately, this will probably only result in a slap on the wrist for these powerful banks, if that.

Fed Rescues Bear Stearns From Chapter 11 to Obscure
Its Huge Silver Short Position From The Public Eye

It is common knowledge by those more well informed on the recent history of Silver Trading on the COMEX that JP Morgan has been sitting on a Huge Short Position In Silver for years, about equal to a full years' production from US mining, part of which was inherited from the "takeover" of Bear Stearns for mere pennies on the dollar in 2008. The more well informed of us recognize that the Last Minute Deal To Save Bear Stearns when no legitimate buyers could be found was more of a White Elephant, Gifted From The Treasury and Fed to JP Morgan rather than an actual corporate acquisition (Bear Stearns had a negative fair market value because of the reckless, losing silver short position, but was allowed to go under because they were threatening to start covering it), with the unstated obligation implicit that JP Morgan would safeguard and perpetuate the huge Bear Stearns Silver Short Position. This is certainly the reason why Bear Stearns was not allowed to fail and go through Chapter 11 bankruptcy, in which case their short position would have been made public and forcibly unwound by the courts causing silver to explode upward in price, thereby exposing the worthlessness of federal reserve notes.
Since JP Morgan is also the custodian for SLV, the largest of the Silver Bullion ETF's, any sane person would view this as an obvious conflict of interest. Shorting a vital commodity such as Silver should by all rights be limited to those with a valid need to hedge production, and a short this size is obviously being held by JP Morgan's Own Proprietary Trading Desk, since the mathematical odds of them having enough legitimate hedging clients to justify a position of this magnitude would be astronomical. NAKED SHORTING SHOULD BE ILLEGAL by every player and market maker in Every Commodity and Every Security in Every Market as it amounts to NOTHING MORE THAN COUNTERFEITING.

[Continued]

http://www.gold-eagle.com/editorials_08/thegoldeneconomizer111210.html

James Turk - Kamikaze Attacks in the Silver Market

With gold and silver in retreat, King World News interviewed James Turk out of Spain.  When asked about silver specifically James said, “They are not dislodging physical silver by running the paper market down.  In fact the silver market is getting tighter and tighter.  That’s why I am perplexed at why they are trying to run this paper market lower.  If they want to get physical silver they are going to have to take the price higher, not lower.”

Turk continues:

“I’ve not seen this kind of tightness in the silver market before and you know that I have been talking about how tight the physical market has been these past few months.”

James, is this sort of like the kamikazes flying into aircraft carriers at the end of the war?

“That’s it exactly.  There is no other logical answer.  What we’re seeing now is exactly what your source out of London said would happen and where the source said the Asians would be aggressively buying.  It’s actually sort of good to have the script ahead of time from your London source. 

Maybe what we are seeing here is the silver shorts trying to make a few bucks in the paper market by dislodging the weak longs.  Liquidity is at its lowest point of the week late on Friday.

From all indications there is going to be a major boomerang effect, and everybody who has been scrambling in the physical market is going to become even more aggressive trying to find and then buy physical metal at these low prices. 

So the shorts who are selling here are playing with fire because if they are called on to deliver, they are going to have a herculean task trying to find physical metal.

Regarding gold, the important thing to remember is that we are still in an uptrend.  The 21 day moving average has not been broken and gold is resting back at key support in the $1,360’s.  The same thing applies for silver, the 21 day moving average is at $25 so it is still above strong support.”

Well there you have it, James Turk has tremendous connections in the physical market and it is extremely tight.

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2010/11/12_James_Turk_-_Kamikaze_Attacks_in_the_Silver_Market.html

CME Taps the Brakes on Silver

Published: Tuesday, 9 Nov 2010 | 3:50 PM ET

Tapping the brakes on the silver rally, the CME sent a letter to its clearing member firms and others Tuesday raising the amount of margin needed to trade silver futures contracts.

The change will go into effect after the close of business Wednesday, November 10th, 2010. 

The reason cited for the increase was a “…normal review of market volatility to ensure adequate collateral coverage…”

Michael Shore, a spokesman for the CME, said the exchange evaluates margins from time to time and they often change—nothing unusual.

New Tier 1 “Spec” Positions will require an initial margin of $8,775, up from $6,750 currently. New “maintenance” margin calls for those positions will rise to $6,500 from $5,000 currently.

Margins on Tier 2 and 3 “Hedge/Member” Positions will go from $5,000 to $6,500 for both new “initial” positions and also, for ongoing “maintenance” margin calls.

http://www.cnbc.com/id/40095040

Hagens Berman Sobol Shapiro: JP Morgan and HSBC Face RICO Charges in Silver Futures Class Action Lawsuit

Banks alleged to have used naked short-selling to rig market

NEW YORK, Nov. 3, 2010 /PRNewswire/ -- JP Morgan Chase & Co. (NYSE: JPM) and HSBC Securities Inc. (NYSE: HBC) face charges of manipulating the market for silver futures and options in violation of federal commodities and racketeering laws, according to a new lawsuit filed Tuesday in the U.S. District Court for the Southern District of New York.

The suit – which alleges violation of the Commodity Exchange Act and the Racketeering Influenced and Corrupt Organizations (RICO) Act – alleges that the two banks colluded to manipulate the market for silver futures starting in the first half of 2008 by amassing huge short positions in silver futures contracts they had no intent to fill, but did so to force silver prices down to their benefit.
The suit was filed on behalf of Carl Loeb, an independent investor in silver futures and options, by Seattle-based Hagens Berman Sobol Shapiro LLP, a class-action and complex litigation firm.
"The practice of naked short selling has long been a serious issue on Wall Street," said Steve Berman, co-counsel and managing partner at Hagens Berman. "What we know about the scope and intent of JP Morgan and HSBC's actions in this short-selling scheme dwarfs any other similar attempt to manipulate a commodities market."
According to the complaint, JP Morgan amassed a sizeable short position in silver futures and options in part through its March 2008 acquisition of investment bank Bear Stearns. By August 2008, JP Morgan and London-based HSBC controlled more than 85 percent of the commercial net short position in silver futures contracts.
The suit alleges that, starting in early 2008, the two banks began manipulating the silver futures market by accumulating unusually large "short" positions and then secretly coordinating enormous sales of silver futures contracts on the Commodity Exchange, which is known as "COMEX" and is part of the New York Mercantile Exchange.
According to the lawsuit, JP Morgan and HSBC used a variety of methods to coordinate their manipulation of the market for silver futures contracts, signaling when to flood the COMEX market with short positions, which caused the price of silver futures and options contracts to crash.
The suit describes two "crash" events that were set in motion by JP Morgan and HSBC, one in March 2008, and the other in February 2010, after defendants had amassed large short positions.  In the wake of both events, the suit alleges, COMEX silver futures prices collapsed.

[CONTINUED]

http://www.prnewswire.com/news-releases/hagens-berman-sobol-shapiro-jp-morgan-and-hsbc-face-rico-charges-in-silver-futures-class-action-lawsuit-106624128.html

Silver investment is breaking records in 2010--Silver Institute 30 year high

Silver investment is breaking records in 2010--Silver Institute

Recent data gathered by the Silver Institute reveals record silver investment, as well as soaring bullion coin demand.

Author: Dorothy Kosich
Posted:  Tuesday , 02 Nov 2010

RENO - 
The Silver Institute noted Monday that silver investment has soared this year with record highs in silver-backed ETFs as U.S. silver bullion coin demand remains "exceptionally strong."
Total global holdings in silver ETFs now stand at 448,997,000 million ounces with 326 million ounces being held by the iShares Silver Trust alone, the Silver Institute said.
Net assets in the iShares Silver Trust totaled $7.8 billion as of October 29^th.
Other notable silver ETFs are being managed by ETF Securities and Zurcher Kantonalbank, with Sprott Inc. recently announcing its IPO for the Sprott Physical Silver Trust, which will be listed on the Toronto and NYSE Arca exchanges.
The Silver Institute also advised that silver bullion coins are "also particularly buoyant" this year with sales of the U.S. Mint's one-ounce Silver American Eagle Bullion coin already surpassing 28 million coins this year. The Mint believes sales could exceed last year's record of 28.7 million coins.
The Royal Canadian Mint is reporting that this year's sales of its Silver Maple Leaf bullion coin are already 30% higher than last year's sales to date, the Institute said.
"Today, the silver price is approaching $25 per ounce and thorugh 2010, the silver price has risen an impressive 47% to levels not seen in 30 years," Silver Institute Executive Director Mike DiRienzo observed Monday. "While this is primarily due to solid investment demand, there is evidence that industrial demand for silver is also on the rise, and that too bodes very well for silver in the long run."



http://www.mineweb.com/mineweb/view/mineweb/en/page32?oid=114043&sn=Detail&pid=102055

JPMorgan, HSBC sued for alleged silver conspiracy

By Jonathan Stempel

NEW YORK | Wed Oct 27, 2010 6:20pm EDT

NEW YORK (Reuters) - JPMorgan Chase & Co and HSBC Holdings Plc were hit with two lawsuits on Wednesday by investors who accused them of conspiring to drive down silver prices, and reaping an estimated hundreds of millions of dollars of illegal profits.

The banks, among the world's largest, were accused of manipulating the market for COMEX silver futures and options contracts from the first half of 2008 by amassing huge short positions in silver futures contracts that are designed to profit when prices fall.
"Defendants reaped hundreds of millions of dollars, if not billions of dollars in profits" from the conspiracy, one of the complaints said.
The respective plaintiffs, Brian Beatty and Peter Laskaris, each said they traded COMEX silver futures and options and contracts, and lost money because of the alleged manipulation.
Beatty lives in Connecticut and Laskaris in New York, court records showed. The lawsuits seek class-action status, damages that may be tripled and other remedies. The defendant banks are major participants in the silver market.
JPMorgan declined to comment. An HSBC spokeswoman had no immediate comment.
The lawsuits were filed one day after the Commodity Futures Trading Commission proposed regulations to give it greater power to thwart traders who try to manipulate prices.

[CONTINUED]
http://www.reuters.com/article/idUSTRE69Q5HQ20101027

Act Now, CFTC Is Urged

By Susan Pulliam & Carolyn Cui

A Commodity Futures Trading Commission regulator is putting pressure on the agency to take action in a high-profile, two-year-old investigation of the silver market.

 
At a CFTC hearing Tuesday to consider new rules to strengthen its commodity-enforcement powers, commissioner Bart Chilton said market players have made "repeated" and "fraudulent efforts to persuade and deviously control" silver prices. Mr. Chilton said he believed there have been violations of CFTC rules that should be prosecuted, though he couldn't publicly disclose trader names.
CFTC Chairman Gary Gensler declined to comment on the silver investigation or Mr. Chilton's comments.

The call to action on the silver investigation comes as the CFTC faces increasing pressure because of its expanded role overseeing derivatives trading under the new financial-overhaul law. For years, lawmakers have criticized the agency for failing to aggressively police the commodities markets. 

http://online.wsj.com/article/SB10001424052702303341904575576203310056046.html

Silver Subject to Price Manipulation, Chilton Says

By Asjylyn Loder and Pham-Duy Nguyen - Oct 26, 2010 6:17 PM GMT 
As an investigation of the silver market by the top U.S. commodity regulator entered a third year, a member of the Commodity Futures Trading Commission said today there have been “repeated attempts” to influence prices. 

“There have been fraudulent efforts to persuade and deviously control that price,” said Commissioner Bart Chilton at a hearing today in Washington, alleging there have been violations of the Commodity Exchange Act. “Any such violation of the law in this regard should be prosecuted,” he said.
The five-member commission began investigating allegations of price manipulation in the silver futures market in September 2008. The CFTC said in a report that year that it had received “numerous letters, e-mails and phone calls” during the last 20 to 25 years alleging prices were being manipulated downward.
The CFTC proposed today new rules against manipulation and disruptive trading practices. Proving manipulation has challenged courts and lawmakers since the early attempts to regulate U.S. commodity markets in the 1920s.
“I don’t believe there is any long-term conspiracy to control prices,” said Leonard Kaplan, the president of Prospector Asset Management in Evanston, Illinois. “Manipulation can occur in small doses for very short periods of time. Adding regulation may not do the trick of correcting the problems simply because the players are smarter than the regulators and they’ll find another way to game the system.”
Silver’s Gain
Silver, used to create the first telegraph messages, has almost doubled gold’s gain this year, beating global equities, Treasuries and most industrial metals. Silver holdings through exchange-traded products surged this year. The metal is used in jewelry and industrial applications such as solar panels.

http://www.bloomberg.com/news/2010-10-26/silver-market-faced-fraudulent-efforts-to-control-price-chilton-says.html

Speculators polish up the price of silver

By Jack Farchy in London
Published: October 20 2010 17:37 | Last updated: October 20 2010 17:37

“Almost anything is better than paper money ... any fool can run a printing press.”
These are not the words of a modern-day gold bug, but attributed to Nelson Bunker Hunt, the billionaire oil baron who went long on silver in the 1970s. So long, in fact, that he and his brother cornered the market, were sanctioned by the regulator for market manipulation and went bankrupt in the process.

After their move, the price of silver hit a peak of $50 an ounce in 1980 before dropping to $10 the following year.
In the past month silver has bounced back to prices not seen since the Hunt brothers’ day. No single investor is cornering the market but, just as in the 1970s, the price is being driven by surging speculative demand as investors sweep up supplies of the grey precious metal whose primary use is industrial.
Investors in silver, also known as “poor man’s gold”, are persuaded by many of the same arguments that have driven the gold price higher: the prospect of a global “currency war” in which central banks race to devalue their currencies to support domestic growth and the belief that a second round of emergency monetary easing by the Federal Reserve could eventually lead to a sharp jump in inflation.
Gold has captured the headlines, ticking off one new record high after another, but volatility in bullion is near a five-year low, which for some investors makes it a less exciting prospect. Returns on silver, they say, could be greater.
Indeed, there are symptoms of spreading silver fever. Sales of silver coins are set to hit a record high this year, while investors have snapped up more than 1,500 tonnes of silver through exchange-traded funds (ETFs) in the past two months alone. That is more than 5 per cent of total annual silver supplies.
Michael Kramer, president at Manfra, Tordella & Brookes, a large US coin dealership, says: “Silver coins are doing very well.”
David Madge, director of bullion sales at the Royal Canadian Mint, says it has already sold in excess of 30 per cent more of its popular silver Maple Leaf coin than last year’s record 10m ounces. The US Mint has sold 27.5m ounces of silver American Eagles so far this year – already within reach of last year’s record 28.8m ounces with the busy Christmas period still to come.

http://www.ft.com/cms/s/0/25b81f4e-dc65-11df-a0b9-00144feabdc0.html

Momentum to propel silver price to new levels.

JOHANNESBURG - 
Author: David Levenstein
Posted:  Thursday , 14 Oct 2010

In 1980, the price of silver exploded upwards and traded above $50 an ounce. I recall this very clearly because I was trading silver through the London Metals Exchange (LME). In those days, the contract offered by the LME was 10,000 ounces, and the price was quoted in pounds, shillings and pence! While it takes more than a few words to explain why the prices went parabolic in 1980, suffice to mention that many investors had no idea what was going on or how they could participate in the silver explosion. I mention this, because the scenario we see with silver now reminds me of what we saw 30 years ago.  I do not mean that the driving forces behind the prices now are the same as those in 1980. Absolutely not; but, once again many investors have no idea about silver, what is going on in the market and how they can participate.
Silver is an amazing metal as it is both a monetary as well as an industrial precious metal. And, the demand for silver in industrial applications is extremely price inelastic.  Despite the fact that there is a large open short position which is held by the 4 or less large commercials trading via Comex, silver is benefiting from both general optimism on industrial production in emerging markets, and the investor interest in safe-haven assets like gold. Barclays Capital recently reported that the holdings of global silver exchange traded products it tracks has topped 14,000 metric tons for the first time. "Indeed, inflows in October have already hit 311 (metric tons), surpassing total inflows for the whole of August and almost half of September's 702 (metric tons)," Barclays says.
In 1980 individuals in South Africa were not allowed to hold offshore funds, and they were prohibited from owning any bullion. Now, even that these draconian laws have been ammended, the number of investors in South Africa and probably worldwide who own any silver is minuscule. Yet, silver has been one of the best performing assets over the last few years, and I believe that it will continue to out-perform most other asset classes over the next 5 years.
---
Unlike gold, platinum and palladium, silver still remains well below its all-time high in spite of a developing shortage of supply. One of the reasons for this is been the alleged price manipulation by large traders such as the bullion banks that have sold massive amounts of silver on the futures markets to keep prices down. Currently, the open short position held by these banks is equivalent to approximately the annual global mining supply of silver.

---

Now US regulators have been urged to reveal the results of a two-year-long investigation into silver and gold price manipulation allegations. Recently, Bart Chilton, a commissioner at the US Commodities Futures Trading Commission (CFTC) which is investigating the claims, said: ‘I think the public deserves some answers in the very near future.' He also added. "I expect the CFTC to say something on our silver investigation within weeks. I can't pre-judge what that will be. I can't even guarantee that the agency will speak. That said, if the agency remain silent for much longer, I intend to speak out on the matter in an appropriate fashion."

Link

2. Why Gold & Silver? - Gold Accounts For Expanding Fiat Currency (Free ...

3. $15,000 Gold? Here's Why. Why Gold & Silver? - The Movie.

WIN SILVER BULLION! 'Why Gold & Silver?' Giveaway

October 2, 2010 - An Unexpected Boost for Silver

By PiercePoints by Dave Forest

I wrote last week about Asia’s love for platinum. This week, it’s looking like there’s a new “hot item” in the East.
Silver.
Open interest in silver on the Tokyo Commodity Exchange has been on a tear. Since last Friday, outstanding contracts have jumped 20%.

It would be tempting to chalk the rising interest up to general enthusiasm about precious metals. After all, prices for gold, silver and the PGMs have all been rising of late.
But it appears that silver is something special in Japan. At the same time as silver contracts are being bought up, open interest in TOCOM gold has remained relatively flat.

The patterns on the two charts are divergent. Gold open interest in Japan spiked in July and has declined considerably since. Silver, by contrast, has been steadily rising for the last six months.
Of course, silver can be a tricky metal to pin down in terms of source of demand. With both industrial and investment applications, buying can be driven either by commercial users or individuals.
It appears in this case that individual buying is responsible. Most of the rise in open interest the last few weeks has come from “non-commercial customers”, suggesting the buyers are individual investors looking for a “store of value” spot to stash their money.
The rise is striking, and certainly helping the silver market. We’ll see if it continues.
Here’s to “poor man’s gold”,

http://www.thedailycommodities.com/2010/10/02/an-unexpected-boost-for-silver/

03 Oct 2010 - Investors see silver lining in economic gloom

By Garry White
Published: 7:00PM BST 03 Oct 2010

Silver prices have risen 31pc in 2010 to a 30-year high, outperforming gold, equities and most base metals. On Tuesday, the gold-silver ratio dropped below 60 for the first time in 11 months.

The gold-silver ratio is simply the number of ounces of silver it takes to buy one ounce of gold. The silver price is currently $22.11 and the gold price is $1,317, so the silver ratio now stands at 59.6.

The ratio varies wildly. In 1970, it was about 20 and it peaked at just under 100 in 1991. The average is around about 40 – and that is the key to any silver bull's argument. Historically, it appears that silver is undervalued in relation to gold, they argue.
In 2010, the ratio has been as high as 72, recorded in February, and is now just below 60. Many believe it could have further to fall.
The reasons for gold's outperformance are well documented – inflationary fears, currency woes and safe-haven demand – but does the declining ratio towards its average mean that silver is going to continue with its charge forward?

[continued]

http://www.telegraph.co.uk/finance/markets/8039595/Investors-see-silver-lining-in-economic-gloom.html

BNP Paribas Buys Physical Silver At $20.58

20th September 2010

News like that would be totally unimaginable even few weeks ago, when price of silver looked ready to go below $17.
But with new buyers of PHYSICAL silver entering this – less than $12 billion market, it’s no wonder why price of silver jumped so high in such short time.
It all started on August 24th 2010 with big German conglomerate buying huge amounts of physical silver and now also BNP Paribas (with headquarters in Paris), joined this rush to get physical silver as soon as possible.

What’s the actual deal that BNP Paribas just made?

BNP Paribas has agreed to pay $20.58 an ounce for 680,000 ounces of the white metal to be delivered from December through to June 2012.
The deal is with Jabiru Metals which will bank $14 million upfront under the hedging deal, money it can well use to speed its mine development program. The 680,000oz is 60 per cent of its forecast silver production over the period of the BNP deal.

If this deal would be done by a small bank, this wouldn’t even be such a big news.
But, since BNP Paribas is one of the largest global banking groups in the world and in 2010 ranked by Forbes as the largest company in the world by assets with over $2.95 trillion – this gets a whole new dimensions.
When one of the biggest banking groups decide to go into a deal to get PHYSICAL SILVER in exchange for their paper money, this is huge signal that price of silver is going up.
It’s not important how much the price of silver will be in a short term – going up or even having a correction.
But it’s important that in the long term – there are more and more signals and confirmations that price of silver is going UP.
Stick with your physical silver (and gold) and if you don’t have to or don’t need to, then DO NOT SELL your PHYSICAL silver!!!
http://agaupm.com/bnp-paribas-buys-physical-silver-at-20-58/

History Says Silver Is Cheap

“If the price ratio between [gold and silver] were to revert back to it’s historical average, then silver prices would outperform gold by more than 2 to 1. In fact, the physical ratio of silver to gold in the earth’s crust is 16 to 1. During the inflationary 1970’s, the ratio between gold and silver prices was at exactly 16:1…mirroring the proportions in which the two metals occur in nature.”
–The Little Book of Commodity Investing, by John Stephenson (Wiley)
With gold currently trading around $1250 per ounce, and silver just above $19, the current ratio of gold’s price to silver’s price appears skewed. One ounce of gold presently buys 65 ounces of silver, so if balance is restored based on the physical ratio of silver to gold in the earth’s crust (16:1), an ounce of silver should be trading near $80.
While silver has many of the same investment attributes as gold, it enjoys the added advantage of industrial demand. And as a currency alternative, silver is more practical. It’s been used as a currency, most notably by the United Kingdom (pound sterling). The French word for money is argent, or silver. In fact, the United States and Great Britain were both on a silver standard up until the 1800’s.
History does have a way of repeating itself, so perhaps our papered money modern world will rediscover silver. Meanwhile, industrial demand continues to grow for silver. Every day another 200 thousand souls are born into our world. The mature and emerging markets demand for industrial metals should continue to expand, and silver enjoys the added benefit of having investment appeal. While not a Fallen Angel in the formal sense, it’s depressed price relative to the growing fundamental case for silver makes it worth considering. I like the iShares Silver Trust ETF at or below $20. Given the exchange traded liquidity and low overall expenses, we view SLV as an efficient way for investors to own exposure to the price of silver.
http://blogs.forbes.com/greatspeculations/2010/09/14/history-says-silver-is-cheap/

Thunder Road Report On The Imminent Surge In Silver

I can’t remember a time in my 23 years in the market when there was so much confusion and uncertainty about the outlook. As the monetary catastrophe unfolds gradually, some days things look a little brighter, then the sheer enormity of the problem becomes only too apparent once again. Sentiment keeps flipping between optimism and pessimism, but the debt bubble just gets bigger! Noel Gallagher wrote “These are crazy days, but they make me shine”, and that sounds like a good enough motto for trying to invest right now (fingers crossed). The silver price has started to trade differently and it appears that BIG MONEY is moving in to the metal (at long last) and fighting the Cartel. There is evidence that the supply of physical silver is getting tight and it could be the beginning of a major upward move in the price.

Ted Butler Commentary - A MILESTONE MEETING

http://www.investmentrarities.com/ted_butler_comentary01-11-10.shtml

As I indicated in my recent interview on King World News, a very important open hearing has been scheduled by the CFTC for Thursday, Jan. 14, 2010 at 1:00 PM. The holding of an open Commission deliberation and possible vote on a specific issue is a very rare event, one that I don’t recall occurring before (although the Financial Times wrote that the last such event was held in 2004). The issue to be considered is that of proposed hard position limits in energy futures and legitimate hedge exemptions to those limits. The public has been invited to observe the proceedings, with the particulars found here - click herel

I plan on observing the meeting and urge you to do the same. If you can’t watch or listen live, I’m sure the CFTC will record the meeting for later review. I’m confident that I will have plenty to comment on after the meeting, so it should be instructive for you to first observe the meeting for yourself, to make sure, at a minimum, that my comments aren’t off-base. I don’t want to create false hopes, but my expectation is that this will be an historic hearing.

While I will have plenty to say after the meeting, let me set the stage for why this meeting is so important and then speculate a bit for what this may mean for commodity regulation in general and for silver in particular. Make no mistake, even if the word “silver” is never uttered in this meeting, I am certain that the eventual impact it will have on silver will be nothing short of profound. Only the timing is in question. More on that in a bit.

This open-to-the-public meeting of the full Commission is both the culmination and potential starting point of a determined effort by Chairman Gary Gensler to fulfill the commodity regulatory reform objectives of the Obama administration.

I confess to growing impatient recently with the pace of position limit reform. My impatience was never about the caliber and sincerity of Chairman Gensler as a regulator, but strictly whether any one man could measure up the extreme nature of the entrenched silver manipulation. I still feel that way, namely, if Gensler can’t do it, no one can (except the market itself). The great thing about the historic open meeting this week is that we should learn more than ever about where Chairman Gensler and the other Commissioners stand on this issue.

This week’s meeting represents an important milestone in a process that began on July 7, 2009, when Chairman Gensler first announced his intention to have the agency review the matter of position limits in the energy markets.
click here

A series of three public hearings soon followed, conducted by the Commission in which testimony was heard from a wide spectrum of industry participants. The Commission’s request for public comment on the hearings led to an outpouring of public reaction (90% of which specifically referenced position limits in silver and gold, although neither commodity was mentioned during the hearings). Numerous follow up speeches and statements from Chairman Gensler and other commissioners have led to Thursday’s meeting.

Let me be clear – this meeting is a very big deal. I believe we will all learn a great deal from the meeting. It should show and record just where each commissioner stands on the matter of position limits, in principle and in terms of what the specific limits should be. It’s important that each commissioner stand up and be counted, either yea or nay. There will be a public comment period after the hearing so that you may weigh in with your feelings. Get prepared to do so. I wish I could press a button and put this process on fast-forward, but no such button exists.

For me, the issue of position limits and concentration in COMEX silver has been a twenty year campaign. I have raised and re-raised this issue with the CFTC and the exchanges continuously, always to be rebuffed. Yet I knew it went to the heart of commodity regulation, concentration and manipulation. I knew then and I know now that the manipulation in silver would end the moment legitimate position limits in silver, as well as the elimination of phony exemptions to those limits, were enacted. I don’t delude myself into thinking that the current CFTC initiative and possible resolution of the issue of energy position limits had anything to do with me or with silver. But I do know that I have repeatedly demonstrated that COMEX silver stands out as the only one where current position limits are out of line with all other commodities and need to be drastically reduced. I have shown where the phony exemptions to the current limits in COMEX silver are absurd, with one US bank holding 40% of the market short.

Even though the historic meeting this week is about energy position limits, no meaningful reform on position limits can occur without addressing COMEX silver at some point. It’s just a matter of time before legitimate position limits are enacted in silver, as well as the elimination of phony exemptions to those limits. If the hearing this week does manage to propose specific energy limits and avoids addressing silver, then we will have hard position limits on energies and agricultural, but not on metals. At that point, I’d like to hear the explanation for why no metal position limits. Presumably, if the Commission does propose specific energy limits, as appears likely, they will also explain the formula they used to arrive at those limits. Whatever that formula may be, when applied to silver, it will show the COMEX silver position limit needs to be drastically reduced.

While we should all have plenty to say to the regulators in the public comment period following Thursday’s meeting, I would suggest there is also something to say before the meeting. Ask the commissioners to be sure to consider and publicly comment on position limits in silver. It’s time for this issue to be dragged out into full view. Tell them that the position limits in COMEX silver should be reduced to 1500 contracts or ask them to publicly explain why that shouldn’t be the limit. Tell them that you find it outrageous that JPMorgan is allowed to be short 40% of the COMEX silver market and 30% of world production and ask them to end JPM’s concentration and dominance.

Many of you have sent me copies of email correspondence you have had with Commissioner Bart Chilton. To his great credit, Commissioner Chilton strives to respond to all who write to him. He has indicated that he believes there should be hard position limits in the metals. Please write to him again and ask him to raise the issue of position limits in COMEX silver at the hearing. Ask him to be courageous and raise this issue publicly, not just in private emails. If the other commissioners are against position limits in metals, that should be revealed for the public interest. Ask all the commissioners, including Chairman Gensler, to fully air the matter of position limits in COMEX silver at this hearing. But please ask in a non-threatening manner. I know the silver manipulation is a crime in progress and, as such, should make you angry. But this is too important of an issue to be less than professional. We just need to get the debate open and allow the matter to be resolved on the merits.

Silver price predictions – silver prices forecast 2010, 2011

November 9th, 2009

http://www.yrth.net/financial-news/silver-price-predictions-silver-prices-forecast-2010-2011

You have to plan ahead to stay ahead. Many sliver price predictions are quite daring. Many insiders forecast silver prices literally going through the roof, soaring in relative terms in the end of 2010 and beginning of 2011, just as they did in the 1970s. Of course, you have heard such prediction before, but the facts and fundamentals remain solidly in place for silver as it remains very undervalued on an historical basis, and is undervalued even against gold. Meanwhile gold has been getting plenty of attention from retail investors, thanks to a concerted push by everyone on TV, Talk Radio and Internet. Even Yahoo! Finance now shows gold prices under Market Summary on its front page. Yet silver remains obscure, the preserve of relatively few contrarian investors with the media and financial press barely covering it. That is why the only response bullish silver price predictions elicit is total disbelief expressed by light facial shock with eyes rolling sky high. All it is now when the silver prices are sitting in the intermediate stage of a bull market that will rival or surpass that of the 1970s.

Silver today is worth less than $17.75 per ounce and was at $20.88 per ounce in March 2008. After an 18 month period of correction and consolidation, silver price looks set to challenge that high in the coming months. Our predictions continue to be bullish on gold (see Gold Price Direction – Gold Prices Forecast 2009 – 2010), and we firmly believe that silver will likely outperform gold and quite substantially. In fact our silver prices forecast for 2010 and 2011 is such that silver will exceed its non inflation adjusted high of $48.70 per ounce and its price can reach $55 to $65 range in the coming years.

Why silver is in a bull market and what is the highest price prediction?
In recent years, gold and silver have outperformed equities and real estate. Due to the very bullish fundamentals, this trend is set to continue in the coming months. The forecast for silver prices in 2010 and 2011 is based on:
– the increasing global macroeconomic, currency and geopolitical risks
– silver historic role as money and a store of value
– the ever declining and very small remaining silver deposits
– significant industrial demand
– significant and growing investment demand

Gold, oil, potash, and other major commodities went over their record highs in recent years because of growing demand and short supply, geopolitical risks and concerns regarding the emergence of inflation and stagflation – all pointing to higher silver prices in the long term.

Silver rose from under $1.50 per ounce in 1970 to nearly $50 in 1980, increasing by some 2,400%. Were silver to replicate that, it would have to rise from $4.37 per ounce in 2001 to $110 per ounce. Such seemingly outlandish silver price predictions make many people laugh, but the silver record high in 1980 adjusted for inflation, according to the US government inflation figures, was around $130 per ounce.

Silver prices forecast considers dwindling supplies
According to commodities-research CPM Group, there were close to 2.2 billion ounces of silver in the world. While it may sound huge, the number of ounces stood at 12 billions in 1900. Today, there is less than 1 billion ounces of above ground refined silver. More than 90% of all the silver that has ever been mined, has been consumed by the global photography, technology, medical, defense and electronic industries.

While the birth of digital photography certainly diminished use of silver in the photo industry, based on current and projected supply and demand trends, the amount of above ground refined silver is to shrink to even lower levels in the coming years as demand has been outstripping mining supply for most of the last 20 years, driving above ground supply to historically low levels. However few in the investment world and almost nobody in retail are aware of this important fact.

Why silver price has not gone up? We do not believe in conspiracy theories. The increased demand has been met by silver ounces from inventories and official government stockpiles, which today are getting close to depletion. Those include U.S., China, Russia and India reserves. Now 80% of silver has been mined as a byproduct of other base metals such as copper, nickel, zinc and lead. In the event of a global stagflationary or deflationary slowdown, you can not expect these base metal miners to increase production for the sake of silver as demand for their core product would likely fall, thus further decreasing the supply of mined silver.

There are only a few pure silver mines remaining, all with depleting reserves. This inflexible supply means that we cannot expect significant mine supply to depress the price rise. All these facts comprise a powerfully bullish picture which is unique to silver.

Increasing industrial demand is bullish for silver
Silver today is used more than ever in traditional applications such as mirrors, batteries, medical devices and electrical appliances as well as more recent ones like cell phones, flat-screen televisions, laptops and other modern high tech devices. Increasingly, silver antimicrobial and antibacterial qualities are being used in many types of medical applications. There are many ongoing research projects on the use of silver based compounds for therapeutic and antibacterial purposes. Increasing industrial demand and application for silver forecast higher prices due to economic growth in China, India, Vietnam, and Brazil. Their growing middle classes are now demanding the quality of life and standard of living enjoyed by many in the West and thus the demand for silver will likely increase.

An important side note – unlike gold, silver is not recycled because of its much lower value. So silver is in a way like oil – as it is consumed and used, it’s gone forever.

Increasing investment demand
With the recent hiatus in real estate and stock market and with gold being very expensive, predictions of increasing investing demand for silver are coming to fruition. There has been a marked increase in investment demand for silver in recent years. The introduction of ETFs that track the price of silver, a new global liquidity bubble, the significant growth in the global money supply, the proliferation of wealthy people, hedge funds and the exponential growth in derivatives. In 2003, Warren Buffet called the latter financial weapons of mass destruction.
Investors in silver bullion coins and bars are hedging themselves against further deflation and falls in property and equity markets. They are further protecting themselves against rising inflation, possible currency devaluations and still very prevalent geopolitical and macroeconomic risks such as those posed by the humongous global derivatives market.

Silver is very undervalued comparing to gold
Silver has gotten grossly undervalued versus gold with the gold-to-silver per ounce ratio at 62:1 ($1,105 / $17.75), which goes against a long term historical basis with average gold-to-silver ratio of 15:1. It has bee estimated that geologically there are some 15 pieces of silver for every one piece of gold. In 1980, this ratio was 17 ($850 / $50) for a short time while the average in the 20th century has been around 40:1. So if the ratio gets close to 40 at today gold prices, the silver price should be around $27.50 ($1,100 / 40).

So silver price predictions for 2010 and 2011 are based on the facts that this is a unique metal in terms of being both a monetary and an industrial metal. Silver is priced at less than $17/oz today. The average nominal price of silver in 1979 and 1980 was $21.80 per ounce and $16.39 per ounce respectively. In today’s dollars and adjusted for inflation that would equate to an inflation adjusted average price of some $60 per ounce and $44 per ounce in 1979 and 1980. Add to this the rising gold prices, geopolitical complications, ever decreasing value of paper money and dwindling supplies, the seemingly insane silver prices forecast does not sound that crazy anymore.

As gold price soars, investors turn to silver

With the international price of gold continuing to climb steadily, many Chinese investors are turning to silver. As with any investment decision, however, experts say there are advantages and risks involved.

Although the international gold price has surpassed 1,200 US dollars an ounce, stores selling gold jewelry are still doing a brisk business. However, the higher price of gold has led many investors to turn to silver.

LINK TO VIDEO :

http://english.cctv.com/program/bizchina/20091212/101184.shtml