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TND Guest Contributor: Dave Kranzler |
Everyone in the precious metals community is scratching their heads over the recent behavior of the price of silver. At the end of the day, the severely depressed price level can only be attributed to the extreme degree of manipulation and price containment activities of the Federal Reserve and the U.S. Treasury’s Exchange Stabilization Fund team (which is officed in the same building as the NY Fed).
Besides containing the upward price movement of gold and silver in order to support its effort to prop up the dying U.S. dollar, the question is, why is silver being hammered like this with Comex futures? Ultimately, I believe a severe shortage of unencumbered physical bars for delivery into India and Asia has developed. More on this in the next few days. In the meantime, you can see from the 20-yr graph of silver that silver is, by far, more oversold than at any time in the last 20 years:
(click on graph to enlarge)
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I spent many years working in various analytic jobs and trading on Wall Street. For nine of those years, I traded junk bonds for Bankers Trust. I have an MBA from the University of Chicago, with a concentration in accounting and finance. My goal is to help people understand and analyze what is really going on in our financial system and economy. You can follow my work and contact me via my website Investment Research Dynamics. Occasionally, I publish on Seeking Alpha too.
As a co-founder and principal of Golden Returns Capital, LLC Mr. Kranzler co-manages the Precious Metals Opportunity Fund, a metals and mining stock investment fund.
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