SILVER v USD

[JBmurc]

BANK PARTICIPATION IN FUTURE CONTRACTS

SILVER Short Futures - US Banks
1/7/2008: 6,199 (30,995,000 ounces)
5/8/2008: 33,805 (169,025,000)
= an increase of more than 5 fold
-> coincided with a silver price drop from $19.55 in Sep to $12.22

GOLD Short Futures - US Banks
1/7/2008: 7,787 (778,700 ounces)
5/8/2008: 86,398 (8,639,800 ounces)
= an increase of more than 11 fold
-> coincided with a gold price drop of $150


Rob Kirby suggests this is the work of a few US Banks. JP Morgan now sports 93 billion + of gold derivatives!

In Rob Kirby's own words:
"Ladies and gentlemen, the OBSCENE amounts of these financial instruments being thrust through the system – allegedly in the name of 1 bank, amounting to MULTI-TRILLIONS per quarter – CAN ONLY BE THE WORK OF A PRIVATE CENTRAL BANK [read, the FED], because no public entity – bank or otherwise - has the balance sheet maneuverability in an impaired credit environment to conduct such business.

The current track is NOT SUSTAINABLE. This is evidenced by the recent “decoupling” or widening of spreads between the futures [COMEX] price of precious metals and the prices being paid to acquire physical metal. We see the same type of divergence in the interest rate complex where LIBOR is set [effectively by 3 month Eurodollar Interest Rate Contracts] at contrived rates where banks are UNWILLING to lend money.

Under our current monetary regime the distortions outlined above will continue to intensify.

This is why I believe it is so important that people consider having an appropriate amount of physical precious metal, which is getting harder to purchase despite recent price bashings.

I would suggest to you all that recent price declines in precious metal, although nasty, have been largely “linear” in nature. My concern is that on our current path, we will reach a point where confidence is shattered, resulting in a geometric advance in the nominal prices of all things real.

Are you protected?"

[peat]

so.......... (I'm keen to explore the conspiracy theory)
Why are the Fed shorting silver ?

1/ so they can buy it cheap to make the Eagles ?
seems a bit ridiculous as they can sell the Eagles at cost plus anyway.

2/ So they can replenish their physical stocks which they've sold over the decades knowing that when they cancel their shorts the price will go back up ?

this situation does make the idea of investing in silver less appealing if you are effectively at the mercy of a mega trader.

[JBmurc]

so.......... (I'm keen to explore the conspiracy theory)
Why are the Fed shorting silver ?

1/ so they can buy it cheap to make the Eagles ?
seems a bit ridiculous as they can sell the Eagles at cost plus anyway.

2/ So they can replenish their physical stocks which they've sold over the decades knowing that when they cancel their shorts the price will go back up ?

this situation does make the idea of investing in silver less appealing if you are effectively at the mercy of a mega trader.

they will have to cover there shorts some time
at current prices alot of mints aren't willing to sell any large quality's of silver alot of news out there on how hard it is to find physical silver just try buy a 5 kilo bar in NZ

Also see the price people are willing to pay for 1oz bullion on trademe there paying 28oz-30oz
----when silver was $4-$5 higher awhile ago people would pay 30-33oz

http://www.financialsense.com/fsu/ed...2003/0718.html

[ananda77]

...about the author: Chris Laird has been an Oracle systems engineer, database administrator, and math teacher. He has a BS in mathematics from UCLA and is a certified Oracle database administrator. He has been an avid follower of financial news since childhood. His father is Jere Laird, former business editor of KNX news AM 1070, Los Angeles (ret). He has grown up immersed in financial news. His Grandmother was Alice Widener, publisher of USA magazine in the 60's to 80's, a newsletter that covered many of the topics you find today at the preeminent gold sites. Chris is the publisher of the Prudent Squirrel newsletter, an economic and gold commentary.

Credit Crisis Financial Armageddon
Stock-Markets / Credit Crisis 2008
Aug 31, 2008 - 03:26 AM

By: Christopher_Laird

..." Now as to the USD strengthening now, and gold's vexing $100 plus volatility, it just seems best to make any protective moves well ahead of the fatal day. Once the situation gets out of control, Credit Crisis II begins, in a week from that point you will find it hard to make any changes. I view gold's present volatility as a total side issue, compared to what would happen if all one's money was tied to the financial system, the USD and so on, and then one's financial situation was frozen if the central banks decide to let go, and world foreign exchange restrictions are instituted. Gold is still one of the best ways to ride out what may come to pass. "

...read the article in full:
http://www.marketoracle.co.uk/Article6048.html

Kind Regards

[ananda77]

...so what is going to happen if asset prices are going up again (sort of overnight if you want) ????

...and what is going to happen if the Fedheads and the Goofi-ernment continue to prop up the financial system and markets against all ods ????

...and what is going to happen if the whole financial thing comes crashing down????

...and who do you think is buying up (apart from me = tiniest speck of dirt in the universe)all the precious metals right now????

...anyway: http://www.kereport.com/audio/0906-02.mp3

Kind Regards

[ananda77]

...US$ in "BLOW OFF" Mode...

Kind Regards

[peat]

A perfect 5 wave up in yellow (starting at 18 in this chart) and abc correction in red (with c projecteda little ) on the hourly here for silver

note that wave 2 (20) almost fully corrects 1 (19), and that 3 (21) can easily be broken into 5 itself . The main 3 and the internal 3 0f 3 are both extended and that for 5 (23) there is divergence on the RSI.

One still has to figure a way of trading using Elliot tho. Its not a trading system in itself. In this instance it should find support just about the high of wave 1 so thats around 11.30.

[ananda77]

...time again to LOAD UP ON GOLD/SILVER (as much as you possibly can)

Kind Regards

...the latest developments to replace Bad Assets with Paper Cash points to a new Hyper-inflationary asset cycle. Ultimately, it will end in an even bigger market crash and even more wealth shifted into the hands of banksters who can play -BIG Fish EAT SMALL FISH- via hedge funds.

...glad I loaded up on precious metals when they were SUPER CHEAP;

...by the way peat, happy to hope, your technical wave scenario WILL come into play since ...time again to LOAD UP ON GOLD/SILVER (as much as you possibly can) etc,etc, etc...

Kind Regards

[JBmurc]

...the latest developments to replace Bad Assets with Paper Cash points to a new Hyper-inflationary asset cycle. Ultimately, it will end in an even bigger market crash and even more wealth shifted into the hands of banksters who can play -BIG Fish EAT SMALL FISH- via hedge funds.

...glad I loaded up on precious metals when they were SUPER CHEAP;

...by the way peat, happy to hope, your technical wave scenario WILL come into play since ...time again to LOAD UP ON GOLD/SILVER (as much as you possibly can) etc,etc, etc...

Kind Regards

Yeah is an absolute steal what you can but Physical silver atm got me another 10kilo's at $700oz ex perth mint ,without doult we'll going see alot higher price come this time next yr min $30oz

[JBmurc]

iShares Silver ETF holdings rise to record 6,901 T
Mon Sep 29, 2008 8:36am EDT Email | Print | Share| Reprints | Single Page | Recommend (0) [-] Text [+] Market News
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More Business & Investing News... LONDON, Sept 29 (Reuters) - Holdings of the world's largest silver-backed exchange-traded fund, the iShares Silver Trust, SLV.A rose to a record 6,901.41 tonnes on Sept. 25, according to the trust's website seen on Monday.

The trust's holdings have climbed nearly 7 percent since the beginning of September as buyers took advantage of lower prices to increase their holdings of the metal.

Spot silver <XAG=> was quoted at $12.91/12.99 an ounce at 1218 GMT, around 5 percent below the level it hit a month ago.

"Physically backed ETFs are very popular right now because there is a sense that they are more of a tangible asset and less exposed to counterparty risk," said Stephen Briggs, commodity strategist at RBS Global Banking & Markets.

Briggs said the resilience of silver ETF holdings over the summer months, when platinum and some gold ETFs were seeing outflows, suggested a different type of investor was buying silver.

"One must conclude that the holders of the silver ETFs tend to be more dominated by the retail investor than is the case for (holders of gold and platinum ETFs)," he said.

"Partly that is because silver isn't as expensive, so it is slightly more accessible."

ETF Securities reported on Monday that the holdings of its silver-backed exchange-traded commodity PHAG.L also rose last week, to 12.089 million ounces.

(Reporting by Jan Harvey; Editing by Karen Foster)