Most Popular
1. It’s a New Macro, the Gold Market Knows It, But Dead Men Walking Do Not (yet)- Gary_Tanashian
2.Stock Market Presidential Election Cycle Seasonal Trend Analysis - Nadeem_Walayat
3. Bitcoin S&P Pattern - Nadeem_Walayat
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
4.U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - Raymond_Matison
5. How to Profit from the Global Warming ClImate Change Mega Death Trend - Part1 - Nadeem_Walayat
7.Bitcoin Gravy Train Trend Forecast 2024 - - Nadeem_Walayat
8.The Bond Trade and Interest Rates - Nadeem_Walayat
9.It’s Easy to Scream Stocks Bubble! - Stephen_McBride
10.Fed’s Next Intertest Rate Move might not align with popular consensus - Richard_Mills
Last 7 days
Stock Market Brief in Count Down to US Election Result 2024 - 3rd Nov 24
Gold Stocks’ Winter Rally 2024 - 3rd Nov 24
Why Countdown to U.S. Recession is Underway - 3rd Nov 24
Stock Market Trend Forecast to Jan 2025 - 2nd Nov 24
President Donald PUMP Forecast to Win US Presidential Election 2024 - 1st Nov 24
At These Levels, Buying Silver Is Like Getting It At $5 In 2003 - 28th Oct 24
Nvidia Numero Uno Selling Shovels in the AI Gold Rush - 28th Oct 24
The Future of Online Casinos - 28th Oct 24
Panic in the Air As Stock Market Correction Delivers Deep Opps in AI Tech Stocks - 27th Oct 24
Stocks, Bitcoin, Crypto's Counting Down to President Donald Pump! - 27th Oct 24
UK Budget 2024 - What to do Before 30th Oct - Pensions and ISA's - 27th Oct 24
7 Days of Crypto Opportunities Starts NOW - 27th Oct 24
The Power Law in Venture Capital: How Visionary Investors Like Yuri Milner Have Shaped the Future - 27th Oct 24
This Points To Significantly Higher Silver Prices - 27th Oct 24
US House Prices Trend Forecast 2024 to 2026 - 11th Oct 24
US Housing Market Analysis - Immigration Drives House Prices Higher - 30th Sep 24
Stock Market October Correction - 30th Sep 24
The Folly of Tariffs and Trade Wars - 30th Sep 24
Gold: 5 principles to help you stay ahead of price turns - 30th Sep 24
The Everything Rally will Spark multi year Bull Market - 30th Sep 24
US FIXED MORTGAGES LIMITING SUPPLY - 23rd Sep 24
US Housing Market Free Equity - 23rd Sep 24
US Rate Cut FOMO In Stock Market Correction Window - 22nd Sep 24
US State Demographics - 22nd Sep 24
Gold and Silver Shine as the Fed Cuts Rates: What’s Next? - 22nd Sep 24
Stock Market Sentiment Speaks:Nothing Can Topple This Market - 22nd Sep 24
US Population Growth Rate - 17th Sep 24
Are Stocks Overheating? - 17th Sep 24
Sentiment Speaks: Silver Is At A Major Turning Point - 17th Sep 24
If The Stock Market Turn Quickly, How Bad Can Things Get? - 17th Sep 24
IMMIGRATION DRIVES HOUSE PRICES HIGHER - 12th Sep 24
Global Debt Bubble - 12th Sep 24
Gold’s Outlook CPI Data - 12th Sep 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

The Unsafe Method of Owning Gold and Silver

Commodities / Gold and Silver 2010 Apr 21, 2010 - 06:00 AM GMT

By: LewRockwell

Commodities

Best Financial Markets Analysis ArticleRichard Daughty writes: Thanks to Bill Murphy and the Gold Anti-Trust Action (GATA) committee, the slimy, market-manipulating goings-on in the short-selling of gold futures and silver futures to suppress their prices at the CFTC have pretty well been exposed, and about time, too.


Tyler Durden at zerohedge.com calls it “one of the largest frauds in commodity markets history,” to which I can only add “I can’t think of one bigger!” although I admit that I am not up-to-speed on the history of frauds in the commodities markets, nor am I up-to-speed on anything, now that I mention it, which probably explains why I am such a failure, but which is another sad story for another time.

And you would have to be as stupid as my boss thinks I am, and my family thinks I am, and all the neighbors think I am, if it didn’t occur to you that a long-term suppression of prices is, using a metaphor I read somewhere, like holding a ping-pong ball underwater, which is going to zoom up when the suppression stops, and that ping-pong ball could shoot up out of the water and hit you in the eye, and you will say, “Ouch! Me peepers!” which will be bad, not because you should have said, “Me peeper!” because only one eye was hit, but because you won’t be able to see the explosive move in gold and silver after waiting for it so long, unless, of course, you were holding TWO ping pong balls underwater, expanding the metaphor to whole new dimensions.

Oops! I seem to have gotten off on a tangent. Sorry! But apparently there is also some consternation about the gold Exchange Traded Funds (ETFs) and whether or not the gold is really there, mostly because of all those disclaimers and “nothing is my fault” stipulations in the prospectus, which, if you take a look at your brokerage agreement or any financial agreement, has all the same fine print.

Gary Tanashian of biiwii.com sums it up by writing, “There is a lot of controversy stirring up with regard to what could be the ‘largest fraud in history’, as gold available for delivery to people who think they actually own metal through paper intermediaries is being exposed as being only as safe as the entities that guarantee its delivery – in other words, not safe at all.”

And, given the latitude that the Federal Reserve, the banks, the International Monetary Fund and all the other banks have given themselves, it’s amazing that ETFs are as conservative as they are!

I mean, for instance, the IMF and the Fed agree that they can lease out their gold, even to the point of delivering the bullion to somebody so that there is nothing left but an empty vault, but yet still count it on the books as being all there and unencumbered! Hahaha!

But the obvious fraud of selling silver short at 100-to-1, or more, is not lost on Jason Hommel of silverstockreport.com, who notes that “the entire world’s annual production of silver, at about 600 million oz., at $17/oz., is barely $10 billion, which is a mere 1/20th of the amount owed in these bullion accounts, which are dominated by JP Morgan,” which he says total to an amazing and outrageous $203 billion.

The actual figures, of the what I am calling The Big Silver Futures Scam, are, according to Mr. Hommel, that these market insiders sold-short futures for “12 billion ounces of silver, which is 24 times world annual production, and perhaps 100 to 160 times the actual supply of physical silver held in London for delivery against such accounts, which may be as little as 75 million ounces or less.”

I knew that none of this would make an impact on the ordinary people of the world who are united in nothing except wanting me to shut up about the Federal Reserve creating so much excess money and credit and how they are morons for not buying gold, silver and oil, of which this futures thing is just a tiny part.

But perhaps a snappy tune would help! I don’t know why I didn’t think of this before!

Calling upon my Mogambo Musical Ability (MMA), I quickly came up with this toe-tapper about the foolishness of people who own paper promises of silver instead of buying physical bullion:

“Ya gotcher paper in your hand.
“You think that you’re so hot.
“You think that you got some silver,
“But paper’s all you got. Chump!”

Richard Daughty (Mogambo Guru) is general partner and COO for Smith Consultant Group, serving the financial and medical communities, and the writer/publisher of the Mogambo Guru economic newsletter, an avocational exercise to better heap disrespect on those who desperately deserve it. The Mogambo Guru is quoted frequently in Barron’s, The Daily Reckoning, and other fine publications.

Copyright © 2010 Daily Reckoning

© 2010 Copyright LewRockwell.com - All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in