HOW CAN SILVER AND GOLD
WHEN US & CANADIAN SILVER
DEALERS SUSPEND SALES
BECAUSE OF LACK OF SUPPLY?
We knew Silver and all the other commodities were over-extended and that they often fall
back quickly once their uptrend-lines were broken. The best clue of the top that I
the failure of Gold and Silver to rally this past Monday in the face of the news of the
of Bear Stearns and a further cut in the Discount rate. Usually such news would be
Gold and Silver. When it failed, we were put on alert and should have used sell
just beneath the rising uptrtendlines. The annual charts of Silver since 1990 are
at the bottom of this page. You can see from these the importance of using a ruler
(or TigerSoft's "diagonal lines" command) to draw important uptrendlines.
of the decline is very suspicious. That is the subject of this report.
| The Sherlock Holmes Story, The Silver Blaze,
is instructive.It contains the famous episode where Holmes determines the murder because
the dog did NOT bark at him.
"Silver Blaze" focuses on the disappearance of the eponymous race
horse, a famous winner, on the eve of an important race and on the apparent murder of
its trainer, John Straker. The tale is distinguished by its atmospheric Dartmoor setting, and
late Victorian sporting milieu. It also features some of Conan Doyle's most effective
plotting, hinging on the famed "curious incident of the dog in the night-time"
- Gregory (Scotland
Yard detective): "Is there any other point to which you would wish to draw my
- Holmes: "To the curious incident of the dog in the night-time."
- Gregory: "The dog did nothing in the night-time."
- Holmes: "That was the curious incident."
( See - http://en.wikipedia.org/wiki/The_Adventure_of_Silver_Blaze
has fallen more than 17% in the
last 4 days ==========
high (red) volume
on the decline.
Why The Big Silver Decline? The Dollar only Got A Techincal Bounce.
Silver dropped by more than 17% this week. Some say this is because the world
economy is slowing down and so world-wide demand for Silver is dropping. China, the
locomotive for the world bull market, has had its banks reserve requirements increased.
Still, since silver coin and bullion dealers can not get there ands on enough silver to
demand from investors who want to hedge against the falling dollar, this explanation
plausible seems dubious.
Another explanation is that Bear Stearns was long a considerable amount of gold and silver
and that this is now being liquidated quickly and clumsily by the FED which has an
in dampening inflation numbers to strengthen the weak US Dollar. The Federal Reserve
and JP Morgan took control of the bankrupt Bear Stearns for just $2/share on Monday.
This explanation is more plausible because Gold also was down severely this week. It
biggest one-day loss in 28 years.
A more cynical explanation is that a few huge, naked short sellers of Silver are
its prices to reduce their rapidly growing losses.
------------------- Rigged, False 33% declines in
Silver Are Not Un-Common -----------------------
Physical Silver Is Disappearing.
This week as silver started to decline, dealers
everywhere put essentially the same message
on their Webster and answering machines as this: "Due to
the OVERWHELMING demand for
precious metals, our online ordering system has been unable to keep up with our
We have had to disable the (automatic) ordering system to allow us ample time to
upgrade our site
to accommodate the increased demand." See:
http://www.golddealer.com/ and http://www.agoracom.com/ir/ECU/messages/768613
"Canadian Maple Leaf Silver Coins Temporarily Out of Stock"
The Royal Canadian Mint has found itself unable to fully meet the
unprecedented demand for silver
Maple Leaf coins with its current supply, and has temporarily suspended shipments. This
temporary until more of this fine bullion product can be struck and shipped. Because many
of our customers
want to purchase this product at today's prices, Northwest Territorial Mint will accept
orders now for
shipment when the product becomes available, which we expect will exceed 30 days. If the
product proves too lengthy, we reserve the right to substitute a similar silver
US Government will not wish to aggravate the shortage by continuing to take silver off
Manipulation by A One, Two or Three Shorts
Who Have A Huge Naked Short Position..
Some believe that a few commercial interests are very short silver and are trying to bring
prices down. The trading mechanics of how exactly, they would do this is not clear.
But a few very
big players on the short side have every incentive for doing this, especially when chart
a price-trend break and it occurs just before a three day weekend against a backdrop of
financial news. The four largest traders hold more than 310 million ounces of
silver net short,
while the eight largest traders now hold a record net short position of over 400 million
In terms of days of world production, or any objective comparison to any other commodity,
the silver concentrated net short position continues to be "off the charts."
A frequent critic of the unregulated Silver shorts is Ted Butler. He follows the
concentration statistics published by the Commodity Futures Trading Commission
(CFTC). They have a
large tax-payer funded budget and are supposed to ferret out manipulation by a conspiracy
of only a few very
big interests. the CFTC monitors the concentrated positions of the largest traders
in every market that it
oversees. It publishes the concentration ratios of the largest 4 and 8 or less traders in
every commodity futures
contract, every week, when it reports these concentration ratios in the long form
Commitment of Traders Report (COT).
Butler asserts that the CFTC does not follow up on the conspiracy-to-manipulate data which
For example., on May 30, 2006, fewer than five large traders in COMEX silver had net
short positions that
amounted to proportionally the biggest short position at any time in history in
Silver.. The degree of "short
concentration" is "far more lopsided" now than for any other major
commodity. "This short position is not
only 3.5 times greater than the concentrated net position of the 4 or less largest long
traders, it is also more
concentrated and larger than any position held by the Hunt Brothers in the great silver
manipulation of 1980"
What makes the present case even more dangerous is that the "total dealer" short
position is much
"The actual numbers state that ... 4 or less largest traders are net short the
equivalent of 181,584,000
ounces, while the 4 or less largest traders are net long 52,506,000 ounces, To put this
short amount into
perspective, it is more than is produced annually on the largest silver producing
continent, North America
(Mexico, US and Canada). Its larger than the combined total holdings in the COMEX
warehouses and the
silver ETF (SLV). The concentrated net short position is staggering in size."
such concentration is a necessary condition for collusion and manipulation, proving that
a conspiracy exists is much harder. That is supposedly why after
the Hunt's tried to corner the Silver
market in 1979-1980, the COMEX strictly limited the size of
individual long positions and regularly
reports them. It does not do this for huge short positions. Accordingly,
silver can be said to rise
without manipulation. But it's falls have often been dramatic. And they are
by essentially unregulated shorts. Butler claims that this concentrated
short position, which still
persists, is naked short. This runs the risk of a prospective huge default and
failure to deliver.
The CFTC will also not tell us the size of the very biggest short positions. Thus
may be short much more silver than the Hunts ever bought.
If you think that these huge short positions should be revealed and limited write:
Commodity Futures Trading Commission Three Lafayette Centre, 1155 21st
Washington DC 20581 RJeffery@cftc.gov
Richard Schaeffer Chairman NYMEX/COMEX World Financial Center One North End Avenue
New York, NY 10282-1101 RSchaeffer@nymex.com
Read also - http://www.dollardaze.org/blog/?post_id=00255
COMMENTARY March 18, 2008 Life After Bear Stearns
"As previously written, the epic concentrated short position in COMEX silver is
a good news/bad news situation. The bad news is that it explains the depressed relative
price of silver and accounts for much of the recent price volatility, as the big shorts
struggle to create sell-offs with the hope of buying back some of their positions. The
good news is two-fold, that it affords the purchase at todays subsidized low price
and will serve as a powerful source of buying on the upside someday. But when? A better
question is what may cause the shorts to retreat?
"The most logical circumstance that could cause the big shorts to run to cover
on the upside is a physical shortage in silver. Remember, the shorts are obligated to
deliver real metal, if and when called upon to do so by the longs. This is the
shorts Achilles Heel, that will doom them some day. It is the combination of
the extreme concentrated short position and the potential of a physical shortage that
portends explosive price action in silver (as distinguished from gold, where no actual
industrial shortage appears plausible.)
"Of course, by the time we get clear evidence of a pronounced shortage in
silver, it is most probable that will already be reflected in the price. In other words,
it will probably be too late to buy silver at "reasonable" prices. Therefore, it
would seem logical to conclude that we must look for subtle clues that might suggest a
physical silver shortage may be upon us. "
Shortage gets Worse, Price Drops Again!
(If you don't hold it, you don't own it)
by Jason Hommel, March 20, 2008
Three more major silver dealers are reported to be out of silver today: The U.S. Mint,
Kitco, and Monex. This, on top of the major dealers yesterday, Amark, Perth Mint,
CNI Numismatics, and APMEX, all reported sold out. Further, nearly
all of Canada is reported to be out of silver, from Vancouver to Toronto. This is
unprecedented, and is a perfect case of market manipulation in the paper market at COMEX
and other futures exchanges to see silver prices continue to drop down to below $17/oz.
today. Paper promises can be created endlessly, but real silver
cannot. This is NOT a case of the dealers getting spooked, and selling out
to the refiners just in time, at peak prices. This is a case of the public
buying up the stock at coin shops across the world ever since gold hit $1000/oz..
That event finally sparked a little of the public's buying of silver and gold.
Thus, the typical coin shop flow of silver to the refiners just stopped in the last
few weeks, and especially the last two days. This is
NOT a case of the public creating a top with 'everyone' in silver, because nobody's in
silver yet. In 2006, only $1 billion was spent on investment silver,
which is 0.007% of the $13.5 trillion of money in the banks. As I have long
reported, the silver market is so small, there is no room for new investor demand, not
even 0.1% of money could be spent on silver, because that would be $13 billion, which
would push silver prices to $200/oz., and we are seeing only the tiniest beginnings of
that. $13 billion would be almost enough to buy all the silver produced by the
mines in one year, which would leave nothing for industry. It would essentially
double demand, but supply would remain the same. Furthermore, this is not a top because
the public continues to get to the coin shops, and is now getting on waiting lists for
silver. The public is not yet in, so how can the price drop? This is a case of price fixing and manipulation...Shortages are
evidence of price fixing. Price fixing results in shortages. They are price
fixing silver at a below market price over on the paper exchanges in New York and around
More Reasons for Thinking Silver Is Being
by A Few Big Short Sellers.
1. The size of Silver's
decline far exceeds what one might expect given
the jump in the US Dollar this week. The Dollar has simply bounced
up from an extremely oversold condition. In the chart below you can
see it hit the bottom of its price channel. It is enjoying a "technical
2. The Asian markets are regularly boosting Silver, but it is declining
when the US markets open.
You can watch this at http://www.kitco.com/charts/livesilver.html
On Monday this week, Silver was up in the overseas markets,
+.51, before the NY market
opened. This was in response to news that Bear Stearns would disappear. In NY
fell to 18.35. The US markets, metals and bank stocks,
seem very manipulated.
Small wonder investors are leaving them in droves.
3. The Silver ETF - SLV - May Not Have The Physical Silver Investors Think
Is This A Scandal That Insiders Are Trying To Prevent.
Cynics have stopped using SLV to own Silver, because they do not believe
SLV holds the silver it claims to hold and that they've been supplying the shorts
with silver bullion to suppress the price. SLV is a "fraud", a
investor confidence in banks only partly accounts for this attitude.
Investors believe there is a
vault in NYC and a vault in London which holds
millions of ounces of Comex Silver Bullion and buying the Silver ETF, SLV, gives
one partial ownership of that silver. This is not the case. Barclay's SLV is backed
to some extent by futures contracts. SLV's newest prospectus, Jan. 20, 2007,
dropped the word "bullion". The new prospectus says: "The
Trust is designed
to provide a vehicle for investors to own interest in silver." This means
futures and bangs of silver coins. Is there a difference? Yes. Bullion's
reliable and easy to track. Silver
coins and Futures are complicated and
As a result, SLV does not publish a list identifying
its silver bars. It is said
that it has 140,00 or so bars of silver. But there is no transparency for
gold ETF does publish a daily record of
the gold bars it holds. (Source:
Critics in the UK who have watched the collapse of Northern Rock, voice
concern that SLV is underfunded because Barclay's has had need to sell its
Silver to remain solvent. The Barclay's chart on the London Stock Exchange
does show a steady downtrend and heavy distribution. Defenders of Barclays
answer that the Bank of New York and JP Morgan-Chase Bank are the
custodians of the silver in NY.
Sources: "Can We Trust the Silver ETF?":
By: John Rubino & James Turk
SELLING FEAR OF A FALLING DOLLAR
To the right is the chart the dealers like to show.
Here is what they say: "World demand for silverfor
industrial, medical and investment usesnow exceeds annual silver production,
and has every year since 1990. Above ground stockpiles are low and are reported to be
Listen to the legion of Super Silver bulls.
Fear of a Declining Dollar is
easy to sell. Those pushing Silver need only to quote prominent officials:
"We face a 75% chance of a financial crisis within five years."
Paul Volcker, former
chairman of the Federal Reserve
"The U.S. does not have more than a 10% chance of avoiding Economic
Stephen Roach, Morgan Stanley
"We are confronting a day of serious reckoning"
Robert E. Rubin, former Secretary of the Treasury
"As a nation... we are running on empty."
Peter G. Peterson,
Chairman, Institute for International Economics.
Former Chairman Federal Reserve Bank of New York,
Secretary of Commerce,
Chairman / CEO; Lehman Brothers
"Gold still represents the ultimate form of payment in the world. Fiat money, in
extremis, is accepted by nobody. Gold is always accepted."
Alan Greenspan, former
chairman of the Federal Reserve
"We're facing an unprecedented tsunami... and evacuation is not an option."
"A Category 6 hurricane is threatening our shores - it's the federal budget
deficit - and no one is worried."
David Walker, U.S.
Chief Auditor of the United States
GOLD AND SILVER PROSPECTING IN NEVADA AND UTAH.
Gold like this.
Would be easy to spot!
Most gold is particles too small to see.
Want to Go Prospecting?
How Do you Find Silver. Gold or Turquoise
"Horn Silver" used to lay on top of
ground in Nevada.
"In Nevada. Silver there formed
strictly on the surface. Over millions of years of desert conditions, silver sulfide
minerals weathered out of their volcanic host rocks and slowly
turned, under the influence of rainwater, to silver
chloride. The climate of Nevada concentrated this silver ore in supergene
enrichments. These heavy gray crusts
were often polished by dust and wind to the dull luster of a cow
hornhorn silver. You could shovel it right off
the ground, and you didn't need a Ph.D. to find it. And once it
was gone, there was nothing left beneath for the
hard-rock miner...The territory of Nevada, along with the states
around it, was picked clean in a few decades."
( Soource: http://geology.about.com/library/weekly/aa102598.htm
Let'e say you have a month and a Winebago
and a desire to go prospecting for silver. say in Utah or
Nevada, what should you do? Here are some pointers I
have found on the internet.
1. Have a working GPS system so that you don't
2. Small pick, gold pan, metal detector, dry
washer amd dredge.
3.. Buy a prospecting book by Richard Pearl.
4.. Do a search for the mines that might be in the area you
want to go to.
Utah - http://www.mindat.org/lsearch.php?loc=oquirrh
Nevada - http://nevada-outback-gems.com/prospecting_info/Nevada_Prospecting.htm
5. Look for hydrothermal sites and baryte.
6.. Find lead. Silver and gold should be near.
Gelana (lead) often containes 1% to 2% silver, chiefly as Acanthite.
7. Find Erythrite, which is a distinctively metalic
Join a prospecting or metal-detecting meetup in your
TigerSoft Accumulation Index Charts of Silver:
See that huge bulge of Blue Accumulation in August 1979. That is the most bullish
condition we know of having studied TigerSoft charts for 26 years. It set up a
in the price of silver in five months.
1979-1980: The Top in Silver
October 1979 - Sept 1980 Silver ==========================
In the chart below, you can see how TigerSoft used the Tiger Accumulation Index to
confirm breakouts and breakdowns below necklines, support leveles, resistance levels
and key moving averages. Contact us for more information. www.tigersoft.com
======================== 1980-1981 Silver =====================================
The head and shoulders breakdown at 20 was confirmed by red readings from the
Tiger Accumulation Index.
1981-1982 Silver ==================================
Repeated failures to get past diagonal resistance and the key 65-day ma were bearish.
So was the steadily Red Distribution.
1982-1983 Silver ===================================
Swift rises in Silver produce hyperbolic uptrends. Our software lets you draw
curves to fit the data, so you know when the "hot air" is coming out of the
pumped up stock
1983-1984 Silver ==================================
Another case of valid support breakdowns being confirmed by a negative Accumulation Index.
1984-1985 Silver ===================================
Nov. 1985 gives another case of valid support breakdowns being confirmed by a
negative Accumulation Index.
1985-1986 Silver ===================================
Feb. 1986 gives another case of valid support breakdowns being confirmed by a
negative Accumulation Index.
1986-1987 Silver ===================================
The March 1987 breakout was confirmed by a Blue Tiger Accumulation Index.
======================== 1987 Silver ======================================
Get out your ruler when Silver runs up 50% in three months or less. Sell when
the steep uptrendline is violated, even though the Accumulation is blue. This
in May 1987.
1988 Silver ======================================
Look for negative non-confirmations at the upper band. They are bearish.
======================== 1989 Silver ======================================
======================== 1990 Silver ======================================
======================== 1991 Silver
======================== 1992 Silver
======================== 1993 Silver
======================== 1994 Silver
======================== 1995 Silver
======================== 1996 Silver
======================== 1997 Silver
======================== 1998 Silver
======================== 1999 Silver
======================== 2000 Silver
======================== 2001 Silver
======================== 2002 Silver
======================== 2003 Silver ======================================
======================== 2004 Silver
======================== 2005 Silver ======================================
======================== 2006 Silver ======================================
======================== 2007 Silver ======================================