You are an investor in physical metal and like Marty of “Back to the Future II” you have stumbled into a nightmare world of $10.00 and whatever cents silver (you may have bought back when it was $15-$20 and thought you were doing well) wondering how can you change this distorted world to a peaceful “Hill valley” of the movie and a reality of honest pricing.
Biff / Griff Tannen aka the SEC/CFTC (Securities exchange commission and Commodity Futures Trade Commission) should look like this picture of a nice old chap that cleans your car and keeps the house in order. Not unreasonable given its position of watchdog to the markets.
Instead its accusers of late charge it with sitting in a Jacuzzi laughing at all of us who have invested in real metal or stocks or anything it has involvement with and we only need to look at the decimated mining industry savaged by naked short selling to understand real investors have been getting hammered of late.
If the odds are so stacked then what can I do?
Make Sure you have physical metal and consider the importance of international diversification where you have privacy and ease of deposit / withdrawal as well as physical holdings on your person.
I say that because history has a bad way of correcting in as abrupt a way as Marty and Doc saving the day!
Let’s look at Nickel in 2006. One moment it was meandering happily nowhere while physical shortages built up and the watchdogs did nothing and then out of the blue it exploded
Check out the fine print of the SEC’s announcement back then and my graph showing the rocket launch in price
LME’s press release of August 16 –
“Those with short positions in nickel falling prompt on Friday 18 August 2006, and on subsequent prompt dates until further notice, who are unable to effect physical delivery an/or unable to borrow metal at a backwardation of no more than $300.00 per tonne per day, shall be able to defer delivery for a day at a penalty of $300.00 per tonne. Those with long positions for prompt on those days who are subject to deferred delivery shall be entitled to compensation of $300.00 per tonne per day
I have spoken openly about the laughable situation back in March where silver and gold broke fresh heights all on the back of a Monday morning “ Bears Stern” collapse and that was hardly up there with the plethora of banking collapses of late. It was just a lower pecking order bank and if you watch CNBC, the promo of Dylan Ratigan, host of “Fast Money” saying “tonight your money is safe” in their advertising of the channel now looks hilarious referring to the following day when Bears Sterns affairs were taken over and gold and silver came off sharply supposedly signaling - we are all ok now!
Yay!
Hey Dylan, hello, hello (I am holding the staff now banging away to anyone listening) … that was back then, is everything ok now?
I am not poking fun at Dylan as this TV commercial promo is just a simple clip of the deception people seem trapped in right now .Who and what do you believe because clearly there are millions around the world asking this very question “ is their money safe”?
Anyway I digress- back to the future!
Oh yes, we all know that Biff will get biffed out of his own hotel and the regulatory authorities will stand and say “this is a new day” and they have fired the old guys cleaned the rules up….blah..blah (just listen to McCain yell out what he plans for Chris Cox, head of the SEC assuming either he or Obama win)……but that’s a fat lot of good to investors holding paper un backed by anything. You only have to look at the heads of failed institutions that presided over the mess and then walked away with fat severance packages. You are still left in the cold!
I ask one of the heads of the company I affiliate to who deal every day with the suppliers as to what is happening right now re premiums given they buy the 1000 oz LBMA good delivery bars at the best price. He replies “there is a disparity albeit modest but who knows where that can go as the paper and real market head opposite direction” says Director -Simon Heapes.” We spend a few minutes discussing the London gold pool of the 60’s and how $35.00 supposed gold price traded in terms of real metal at $44.00 to quote actual events.
If you can have disparity at refinery account supplier level then its small wonder the smaller bars can command even bigger premiums. Have you ever asked yourself what happens when there is a run on a market clearing stock as to what goes first?
A/ the most expensive largest items or
B/ the smaller retail sized items
Anyone looking at this hydro dam of cracks and water spouts would have to be blind to see it needs some engineers to fix it and fast and that is exactly where the SEC and CFTC are supposed to stand in the breach and do their jobs
Histories most ancient of money becomes ever more worthless in this alternate “Back to the future reality” and you must ask yourself the same question all do when a real crisis hits
What is money?
Well hold on to the real stuff as you are about to find out!
http://www.anglofareast.com/afeannouncementbailment2.html
AFE locked away 5 metric ton of allocated silver bars and tens of 1000’s more oz’s of gold in this bailment. Independent Auditor from Grant Thornton, Zurich in attendance during bailment of silver bars, Philip Judge holding a 400oz gold ‘Good Delivery Bar’ alongside several ton of silver bars during AFE’s Bullion bailment at ViaMat Securities, Zurich.
Word on the street is large buyers ex comex are getting called and attempted persuasion to settle in cash, not in physical delivery. This is a rare opportunity to dollar cost average previous purchases as some are already doing or simply get in at one of those exceptionally low moments just like last Friday!
10 October , 2008 gold closes 849.90 and silver 10.14
For me, at this low price level of a few years ago, I do the best when my clients can get more bang for buck as I earn in ounces as a percentage of what they get so the sooner we have 1000 oz bars going for $1.00 an ounce and a free set of steak knives thrown in, the better we are all off and the faster we can all move on just as history has done before and go “Back to the real future!”
Disclosure ; Duncan Cameron is an affiliate of “Anglo Far East” and endorses bullion holdings on your person mixed with international diversification via this company that has rigorous 3rd party auditing procedures to verify clients holdings. Whilst I trade, make no mistake, trading is a pastime that can never replace core bullion holdings.
http://www.anglofareast.com/broker/dc-001
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