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A Silver Hoard Near Record High Has Transnational Silver Abusers Concerned
Be prepared for the next great transfer of wealth. Buy physical silver and storable food.
silvervigilante.com / By SV / August 14, 2012
Appearing on November 9, 1998, “India Silver Hoarding Worries Users Group,” penned by Silver Users Association spokesman Walter Frankland, stated:
“Is there a role for the Silver Users Association–in conjunction with groups in other countries–to take action that would focus on India and see if their market can be opened to freer trade? There’s no reason to wait around until volatility hits the market again, in my opinion.”
In the United States and the “west”, doused in mainstream media mustard gas, less than 1% of the retail public buys silver. In other countries, taxes of 50% and more on silver sales has dampened demand. But it cannot forever. The derivatives bull market has created a bull market in physical silver that does not exist and a pop-panic out of paper like the world has never seen will ensue. The war on silver will spin epically out of control, and there is no telling where the price may land.
That, alongside short-and-medium term speculation, is why investors’ holdings are near a record high set last April for silver, despite that hedge funds are the least bullish on silver in nearly four years. In the medium-term, speculators have reduced bets on higher silver prices by 72 percent since the end of February, according to U.S. Commodity Futures Trading Commission data. Silver products held in exchange-traded funds, however, have increased three straight months and now totals $16.2 billion, according to Bloomberg.
Since the first three months of 2012, silver has, for the lion’s share, been held under the $30 mark. Until March, silver appeared to be heading back towards $50 an ounce, its previous high, after climbing above $36. This was short-lived. Now, analysts, based on a survey by Bloomberg, expect the price of silver to average $33.02 an ounce in the fourth quarter. Despite any bias that a panel chosen by Bloomberg might encompass, silver remains on a long-term trajectory poised to continue its peak-every-two-years model.
The long-term, to be sure, is only in terms of human lifespans, for already the silver price has sat well-off its recent high in April of 2011 for a year-and-four months. That would mean that, although silver might have a doldrum 2012, it would then begin to rise significantly in early 2013. The price of silver will average $33.02 an ounce in the fourth quarter, 18 percent higher than its current price, according to the median of 13 analyst estimates compiled by Bloomberg. Silver could then easily be poised for a 100-150% rise in price in early spring 2013, landing it at least around $66 per ounce.
But, some hedge funds are predicting an economic slowdown which they surmise will curb demand for silver. On the opposite side of the rope in the tug-of-war for silver, many monied investors and main street investors are anticipating a price rise based on the implementation of global quantitative easing, spearheaded by the Federal Reserve. The price of silver tripled when the Federal Reserve purchased $2.3 trillion of debt through Quantitative Easing 1 and Quantitative Easing 2 from December 2008-June 2011. One can tease also from the chart below that in the late summer of 2007, as there was a stealth Q.E., silver responded predictably.
Thanks to BrotherJohnF
2012-08-14 17:20:59
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