Thursday, November 24, 2011
Sunday, November 20, 2011
I spoke today with “The Silver Guru” himself, David Morgan, publisher of The Morgan Report. David moved subscribers into silver over ten years ago.
In today’s interview, David shares his thoughts on the MF Global collapse and why it’s explosively bullish for gold and silver physical bullion. Additionally, David feels gold may break $1900 in the first quarter of 2012. On mining shares, David feel’s they’re oversold, and offer a unique value at these levels.
To listen to the interview, right click the following link and/or save to to your desktop:
To learn more about The Morgan Report and follow David’s work, visit:
Sunday, November 6, 2011
Silver Manipulation And CFTC's evasion after 3 years investigating silver is answer enough
By: Chris Powell, Secretary/Treasurer, GATA
-- Posted 5 November, 2011 | | Dear Friend of GATA and Gold (and Silver): Under renewed pressure by Commissioner Bart Chilton to account for itself, the U.S. Commodity Futures Trading Commission today issued a statement about its 3-year-old investigation of manipulation of the silver market, asserting only that the investigation continues. Those who have been taking the CFTC investigation seriously may wax indignant over the delay in resolution. But the delay speaks for itself, and eloquently: Thanks to the complaint about market rigging by London silver trader Andrew Maguire and GATA's publicizing it at the CFTC's March 25, 2010, hearing and agitating about it afterward, the CFTC has probably realized that the rigging of the silver market is, like the rigging of the gold market, a U.S. Government operation conducted through intermediaries, primary dealers in U.S. Government securities, and thus can't be examined in public without crashing the operation and impugning the whole government of which the CFTC is a part. The CFTC well may expect that the silver business can be resolved by a confidential settlement of the class-action lawsuit brought against the main silver market manipulator, JPMorganChase, in U.S. District Court for the Southern District of New York. (See the lawsuit's consolidated complaint here: http://www.gata.org/node/10448.) If the lawsuit survives a summary judgment dismissal motion by JPMorganChase, which seems likely, insofar as such a motion must presume that everything alleged in the complaint is true, the lawsuit may be worth a few hundred million dollars to the investment bank just to prevent any hostile law firms from inspecting its books and interrogating its traders and managers in court-ordered discovery and deposition. Such a settlement will make the plaintiffs' lawyers very rich and let the CFTC off the hook even as it leaves the public with no formal finding of what actually happened. Will it end the manipulation of the silver market, or will that manipulation be ended by whatever futures market position limits the CFTC eventually decides to enforce? Maybe -- or maybe JPMorganChase will find intermediaries through which it can continue to enter the market in disproportionate size and thus continue to control it. In any case silver investors probably should be thankful enough that the CFTC held that hearing a year ago in March and thankful particularly to Commissioner Chilton for insuring that GATA Chairman Bill Murphy and GATA Board of Directors member Adrian Douglas were allowed to speak and introduce Maguire's complaint in detail. On the day of the hearing silver was hovering around $15 per ounce and had been going nowhere in particular. By the end of the year it had doubled and this week it closed above $34, and there are many signs of its physical shortage as the paper hangers of the fractional-reserve precious metal banking system thrash around desperately to regain control of the market. Anything beyond this would require one agency of the U.S. Government to execute other agencies of the government, agencies much bigger and more sinister. Most likely the CFTC would be executed first. Indeed, GATA often worries for Chilton's safety and is sometimes surprised that he hasn't already been found in circumstances making it appear that he had been struck by lightning, a meteorite, or a freight train. So thanks, CFTC, but we don't need your silver investigation anymore. You've already told us all we need to know. The CFTC's statement is appended. Additional comments made by Chilton today to King World News, regarding the collapse of the trading firm MF Global, can be found here: http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2011/11/5_Ba... CHRIS POWELL, Secretary/Treasurer Gold Anti-Trust Action Committee Inc. * * * CFTC Statement Regarding Enforcement Investigation of the Silver Markets Press Release U.S. Commodity Futures Trading Commission Friday, November 4, 2011 http://www.cftc.gov/PressRoom/PressReleases/silvermarketstatement WASHINGTON -- The Commodity Futures Trading Commission today issued the following statement: In September 2008 the commission announced the existence of an enforcement investigation into the possibility of unlawful acts in silver markets. Since that time, the staff has analyzed over 100,000 documents and interviewed dozens of witnesses and obtained expert advice. It has been a long, detailed, and thorough investigation, and it continues in an appropriate and considered manner." |
Wednesday, November 2, 2011
Chinese Silver Investment Going Parabolic
BY DAN COLLINS
Chinese investment in silver has exploded since last year, with the trading volume going exponential. The China Daily reported today that the trading volume of silver forwards on the Shanghai Gold Exchange (SGE), China's only exchange for the precious metal, surged 751 percent year-on-year in 2010. Meanwhile, the volume in September of this year was more than six times that of the same period in 2010.
Chinese commercial banks are now selling silver to investors in the hundreds of tons. One example is the Industrial and Commercial Bank of China Ltd (ICBC), China's biggest lender which launched paper silver trading for individual investors in August of last year. The other large Chinese Banks have also introduced silver trading. The trading volume of ICBC's paper silver products alone reached 300 tons in the first half of 2011, almost four times the figure for the whole of 2010. That's right, one Chinese bank alone sold 300 tons or over 10.5 million ounces of silver in only 6 months. In only their first year of trading, ICBC bank alone will sell over 20 million ounces of silver which alone would represent over 2% of the total amount of silver mined on earth for the entire year.
The key factor to pay attention to is that most of these silver purchases are forward contracts and not the actual physical silver. What happens when Chinese investors demand physical silver instead of paper silver?
Modern day commodity markets are characterized by a continuing divergence between the “paper” and the real “physical” markets. The Chinese silver market is no different.
Most commodities trading takes place between parties than have no physical supply of the materials. In the Silver market, the distortion between the physical and paper markets is extreme. Every day in the global markets, $50 Billion dollars of silver can be sold daily by parties that actually own no silver. The global silver market will trade 1 billion ounces daily in global markets which is more than the entire amount of silver mined each year, which is close to 900 million ounces.
Demand for precious metals in China is skyrocketing. High inflation and a lack of investment options are the main culprits. With new housing regulations bringing housing investment to a standstill, investors are looking for new ways to invest cash. The housing market looks to go down and the stock market is widely viewed as corrupt and risky. Gold and silver are becoming increasingly popular.
China’s net imports of silver hit a record high in 2010 with the volume quadrupling to a total import amount of 3,500 tons. This is a major shift as China was previously a net exporter.
In China, silver has served historically as the main medium of exchange in China. It was an official currency in China as far back as the Han Dynasty (206BC-220AD). Silver Ingots were used to horde wealth and Silver Taels were produced by the government to function as currency or to back a paper currency. The Chinese word for “Bank” is literally translated as “Silver House”.
Chinese silver trading is largely a paper market today. Chinese Banks are selling paper silver in massive amounts which will no doubt continue to double or triple year after year. These paper silver contracts are redeemable in silver bars at the banks yet the banks do not have the silver. Chinese investors are often fickle and enjoy hard assets. What kind of short squeeze will develop when Chinese banks are forced to go onto the open market and buy physical silver to support Chinese investors when they switch from paper silver to physical silver?
What is the Mandarin term for “The mother of all short squeezes”?
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