Remembering The Last Time This Happened To Silver……
In Open Thread on Tuesday, September 27, 2011 at 6:54 am
Silver may hit as low as $22.00 to $23.00 this time around, but be careful how long you wait to see the bottom, as it could spike at any time.
When the COMEX continues to run dry of physical silver, there will remain no physical silver to back their fraudulent derivative paper sells, that they are doing now.
What they’re trying to do is to scare people in thinking their is now demand (which is crazy due to industrial use) for silver thus (they want you to sell yours) if you do sell your ‘physical silver’ this will then give them back physical silver to validate their derivative paper sells. If you do not sell your ‘physical silver’ they will be forced to make good on their derivative paper sells by coming up with ‘cash’ from some other source. This is called ‘catching the shorts’ in their ‘naked short selling’ fraud. So don’t buy into all of their attempts at manipulating the market. China is buying ‘physical’ gold and ‘physical’ silver right now at astronomical rates. Let us no forget that Venezuela‘s Chavez just forced London to ship all his ‘physical’ gold back to his vaults in his OWN country. This is leaving the bankers with their worthless paper (derivative paper). Those who are in vesting into silver through their brokers etc (which means by paper), you may want to re-examine your position for that of taking ‘physical possession’ so you’re not caught up in the ‘paper crash’.
If you’re a silver investor, you may have that strange feeling you’ve been here before. That’s because you have. Here’s a chart comparing the price action of SLV from 12/17/2007 – 8/11/2008 to the price action of SLV 2/01/2011 – 9/23/2011:
Can you tell which is which?
The correct answer is: It doesn’t matter. Same movie, different year. In the case of 2008, the illustrated smackdown in silver preceded the Lehman collapse by about 4 weeks. Silver would not bottom until October 24, after Congress sold the grandkids into slavery for the sake of Goldman Sachs and other abominations of (paper derivatives). I don’t know exactly what is going to happen in the next month or so, but I am sure it’s going to be huge and I’m sure that once again when everyone else panics, the smartest response will be to buy silver.
Silver was $4.18 when those planes hit the twin towers, $11.20 when Congress and Wall Street hijacked America (TARP – 10/3/2008), and $17.69 when the flash crash happened (5/6/2010). It’s not a bubble; it’s a rapidly vanishing resource, and when the next shoe drops, you should buy it.
In July, I told readers that the “set-up” for a market crash simply wasn’t there - that has changed. In 2008, large traders piled into the US dollar just prior to the carnage (just like they are now). As the dollar soared in the ensuing weeks, everything else (most notably America’s future) went in the crapper. Silver was dirt cheap – you just had to be smart enough to recognize that.
There are however some notable differences between 2008 and 2011:
- We’re $5 Trillion deeper in debt.
- There’s 50 million fewer ounces of registered silver at the COMEX
On October 24, 2008 the LBMA silver fix was $8.88 and there was about 83.4 million ounces available for delivery at the COMEX. On April 28, 2011 the silver fix peaked at $48.70 and registered silver stood at 33.3 million . So just to review, a 450% increase in the price of silver produced a 63% decrease in the amount of silver offered for settlement:
Abandon all hope of price discovery ye who enter here. Clearly the COMEX is hurtling toward the date with destiny you’ve been told about over and over (it’s only a matter of when). When silver dipped to $8.80, the market value of the registered inventory at the COMEX was a measly $740M. After the recent price gyrations, registered silver is now 31.04 million ounces, so that value now stands at $950M, or less than half the value of today’s SLV transactions ($2.1B). How crazy is that? I think Ben Franklin would say something like:
Those who would trade paper silver to get more fiat, deserve neither fiat nor silver.
One reason for silver’s surging investment potential is simple: Silver is real money, and money talks!
With government spending getting out of control, silver is where the smart money is going. Silver is also a great way to actually make money go further, instead of the wilting dollar.
Remember that during the similar economic climate of the 1970′s, silver went on an unprecedented rocket ride from $1.29 per ounce to just shy of $50… an increase of nearly 3,733%.
There’s no guarantee that you’ll see a 3,733% return over the next few years. I believe you can and will make money in silver over the next few years – more than you could with ordinary stocks, bonds, or mutual funds.
Fundamental changes in the market could send silver soaring to $50, $100 and even back to historical highs above $1,000/oz (in 2010 dollars).
“The first thing to understand about silver is that it is close to a 5,000 year inflation-adjusted low.” – silver and Gold expert James R. Cook
If you’re like me, 5,000 years may be hard to comprehend, so let’s take a look at the last 700 years.
Back around 1444, Silver was at it’s all time high of $1,057. Then, the new world was discovered, the Potosi mines opened in 1545 – and the price dropped to around $600. Later silver discoveries in the western U.S. brought prices down even further to around $100. Fast forward to 2004 and Silver hit rock bottom at around $5.
Today, Silver is making a bullish charge, rising to today’s price of $36.10. Even so, Silver is incredibly cheap right now, especially compared to gold.
A gold/silver ratio of 15 would put Silver in the $102 range… more than double the current price. But there’s a few facts you should know that really separate silver from Gold and other precious metals.
Unlike gold, which is used primarily as a store of value, more than 95% of the demand for silver comes from industry.
Silver is used in everything from healthcare to cell phone to batteries.
“Silver is a component in many up-and-coming “green” technologies.” – journalist Lara Crigger
Silver can also be found in new fabrics to create odor resistant clothing. It’s found in swimming pools, in energy efficient windows, on CDs, on DVDs and even in toys.
Because silver is used for industrial and technological purposes, it is used up… and it cannot be reused. So, it’s gone from supply… forever.
Here’s the bottom line on silver: There aren’t any stockpiles of silver left anywhere in the world. That makes silver a great opportunity for anyone who wants to make money work harder (and safer) for them.
The U.S. Government mints a coin called the Silver American Eagle that makes the perfect choice for taking advantage of this opportunity. These coins have traditionally been collectible in nature because of their rarity but recent trends have turned these collectibles into even more.
There are 3 unique properties of U.S. government issued Silver Eagles that make these collectible coins desireable:
These coins are widely recognized and therefore liquid. It has always had an eager market for owners who want to sell it.
It is easily divisible should you need to “cash-in” a portion of your investment. You’ll be able to use it to buy goods and services in the future.
It is already “pre-certified” and should not need independent verification of purity and value like silver bars, silver rounds, or collectible grade coins. This is because every Eagle is date-stamped and has official U.S. Government markings.
So what’s the best way to collect silver and take advantage of this up and coming way to make money? U.S. Govt. issued Silver American Eagles!
Courtesy : EzineArticles.com
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- Buying Silver and Gold as Part of Our Preps, by Jeff in Upstate New York (survivalblog.com)
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