Articles & Blogs - Silver Commentary

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In Parts I and II, we were presented with a shocking perspective on the silver market. The principal record-keepers for the silver sector, and the largest single regulator of the silver market both display not only an abysmal level of ignorance concerning the silver market, but the seeming incapacity to even understand basic arithmetic operations.

The result of this display of ineptitude is that the mainstream data and analysis which reaches the market from these official and quasi-official sources has absolutely no basis in reality. It is precisely this sort of vacuous nonsense which is relied upon by mainstream silver bears when they spew their negative drivel.

And one cannot say the words “negative drivel” in connection with precious metals without immediately thinking of Kitco’s Jon Nadler – the man who has gone through a 10+ year bull market for gold without ever once stating that today was a good day to buy it. Apparently his banker biases simply run too deep. Speaking of Nadler’s biases, they were clearly on display in a recent hatchet-job on silver by the Globe & Mail which was so shoddy that it didn’t even rank as good fiction. First the context:

Some market watchers are warning that silver faces a vicious bear market that could eventually take the price to the mid-teens…

Well, we know what the silver-hater who wrote this piece thinks about the silver market. What we don’t know is what planet he is writing about, because it obviously has nothing to do with the planet Earth. The near-total depletion of inventories, and the imminent default-event which that portends, suggest nothing other than that the upward move in the price of silver has just begun.

What clearly identifies this as propaganda, and not even an attempt at journalism is the following passage:

…the problem with the bullish case for silver, at least over the near term, is the threat of growing supplies.

A key industry figure highlights the problem. According to the trade association the Silver Institute, the average cash costs at silver mines…worked out to a mere $5.27 an ounce in 2010…

Note that this sleazy shill talks about “the threat of growing supplies” without being able to muster even the tiniest kernel of data about actual growing supplies. The implication that the current profitability of silver mining will thus flood the market with silver “over the near term” is the precise opposite of reality.

1) Despite a ten-fold increase in the price of silver off of its 600-year low (spread over a 10+ year period) we have seen no more than a 1% to 2% annual increase in silver production throughout that period. This means there is absolutely zero empirical evidence to support the fraudulent assertion of this writer.

2) The approximate time to bring a new mine into production typically falls into the range of 5 – 10 years. Thus the profitability of silver mining today couldn’t possibly have a significant impact on silver production until (at least) the middle of this decade. This means that the ridiculous assertion of a surge in supply “over the near term” isn’t even theoretically possible.

Indeed this piece of rubbish is so utterly opposite with reality that the writer appears to have demonstrated the perfect qualifications to work for the CFTC. Yet we have Nadler of Kitco claiming in the same piece that “Silver has got a cloudy lining.” The Globe & Mail hack who wrote this piece has got an excuse: he’s just some media drone who didn’t know anything about the silver market to start with, and thus was willing to swallow the first “data” that was handed to him.

But what’s Nadler’s excuse? One would think that after 10+ years of always getting it wrong that any professional might actually start to do their homework – and improve their own dismal accuracy rating. Not Nadler. Doing a superb imitation of a “broken record”, Nadler spouts the same, tired rhetoric; over and over, year after year.

Like that other infamous propaganda dispenser, Jeffrey Christian, Nadler continues to parrot the bankster propaganda that Western central banks have “no interest” in manipulating the gold market, despite confessions from numerous officials who worked for these banks, including officials from the Bank for International Settlements, and the two most-famous Chairmen of the Federal Reserve in the last half-century: Alan Greenspan and Paul Volcker.

All serious precious metals investors are familiar with Alan Greenspans’s infamous promise that “…we stand ready to lease gold in ever-increasing quantities”, and it can only be interpreted as intent to squash the price of gold – should its soaring price ever sound the warning that the bankers’ money-printing atrocities were mushrooming out of control.

More recently Paul Volcker acknowledged the bankers’ willingness to use gold as a tool to deal with “exchange rate instability”, which is saying precisely the same thing, except framed as a bankster euphemism. Just as the precious metals propagandists simply fabricate their own data and “fundamentals” – since the real facts completely contradict their spurious attacks – they are equally willing to flatly deny words and events which have existed in the public domain (in some cases) for decades.

The motive for suppressing the price of silver (as with the price of gold) is maddeningly simple and obvious. What has changed since silver was $5/oz and gold was $300/oz? Nothing has changed with the metals. An ounce of gold in the year 2000 is just the same as an ounce of gold in 2012. Obviously the rising prices for these metals can only mean the paper the bankers are printing has been losing value – and rapidly.

This is why anyone/everyone who understand the fundamentals of precious metals refer to these metals as “the canary in the coal mine”. If prices for precious metals start to rise rapidly, this is a direct warning to us that our banker-paper is rapidly losing value. The banksters’ age-old con of stealing-by-dilution is thus exposed to the masses.

Yet we have the CFTC in 2004 and bankster front-men like Jon Nadler today insisting that it’s “impossible” to see any genuine motive for suppressing the prices of gold and silver. Meanwhile, we have our insane/incompetent/traitor governments trumpeting the news that they are engaging in “competitive devaluation”: racing to see which of them can drive their currency (our “money”) toward zero the fastest.

Why isn’t there rioting in the streets? Why haven’t all these idiot-traitors been thrown out of office? Because the apathetic sheep who vote for them (up until now) haven’t bothered flicking the “on” switch with their brains to process what competitive devaluation really means.

But what happens when gold surges above $2000/oz, and silver surges above $50 (as is inevitable as long as competitive devaluation continues)? Will the switches go “on” then? Or will it take $2500 gold and $75 silver? At some point the canary in the coal mine will wake up the masses, and the “marks” will be aware of the con-men’s game. And then it all comes to an end.

It is a “motive” which is now worth in the $100’s of trillions to the bankers and their minions – in the nominal, fantasy-world of the banksters’ paper money. The largest financial motive in the history of humanity. It is a simple, obvious, direct function of arithmetic – beyond any possible contradiction. With respect to any individuals who claim to be unable to perceive this obvious motive there are only two possibilities. Fill in the blanks.

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written by Jeff Nielson, February 01, 2012

down the road, how do you think acceptence as trade value generic rounds and bars will be compared to eagels and other official mint coins? Should a stacker go 50% private mint generics and 50% mint coins like Eagles or, what kind of mix would you reccomend.

Xploregon, I've been quite conservative in my attitude here. I don't KNOW how the "acceptability" issue will play out - so my policy has been to stick to the MOST acceptable product: legal tender minted coins.

They are the most difficult bullion product to counterfeit (successfully), they are the only product which ALREADY have the status of "money", and thus they would/will be the money-of-choice if (WHEN) the fiat-paper Ponzi-schemes come crashing down.

For me, paying a couple extra percent up front is worthwhile "insurance" as we look toward a very uncertain future. Also, if you haven't read this previous commentary, I also think coins can be a better route to go from a TAXATION standpoint:

"Save Taxes With Gold and Silver Money"
http://www.bullionbullscanada.com/~ph33r09/bullionbullscanada.com/index.php/templates/system/index.php?option=com_content&view=article&id=22979:save-taxes-with-gold-and-silver-money&catid=48:gold-commentary&Itemid=131

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written by Xploregon, January 31, 2012

Bravo Jeff!

Always insightful and provoking.
On another note, down the road, how do you think acceptence as trade value generic rounds and bars will be compared to eagels and other official mint coins? Should a stacker go 50% private mint generics and 50% mint coins like Eagles or, what kind of mix would you reccomend.

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written by Jeff Nielson, January 30, 2012

Thanks Tony-BBC.

Yes I agree that ordinary people are the clear VICTIMS of our governments and our "system". Yes I agree that they are not the CAUSES of our current problems.

But apathy is a much more SEVERE character flaw than is generally considered to be the case in our APATHETIC cultures. At one time people held more VIGILANT views:

"All that is necessary for the triumph of evil is for good men to do nothing"

Edmund Burke.

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written by tony_bbc, January 30, 2012

"Why isn't there rioting in the streets?"

It's because the public schools / educational systems specifically do NOT teach monetary history, causes, and effects in the United States. They teach that the crash in 1929 was due to a bubble in stocks (from evil speculators), and the president prevented the Great Depression from being worse by handing out jobs via the WPA and other government programs. When I was in high school (quite a long time ago), the briefly mentioned the gold confiscation, but claimed it was just a simple exchange, and that everyone was given dollars in exchange, so it was no big deal. Nobody is told that the dollar was only defined in gold and silver, and that when money has no silver backing it, that it has no definition. Oh, and parents are of course discouraged from teaching their children anything as they don't have any teaching credentials.

As a result, probably for 50 years (two whole generations or more) the people of this country have systematically been brainwashed into believing what certain powers want them to believe.

For a long time, I was horrified when I learned that in Vietnam after the US left, that people were sent to "re-education camps" so they could "learn" socialism and communism. It occurs to me that our public school system can be considered a form of un-education camps, where children are taught that everyone is above average, and that if you believe in yourself, that you can achieve anything, but only if you obey the rules and respect those currently in charge. The only acceptable form of rebellion is against your parents - (in which case, it's not only OK, but encouraged).

I don't think it's right to blame the sheeple. They don't know what they don't know. It took me a great deal of time, research, and digging to understand the events of 2008. At first, I did not believe a great deal of what I found. But after fact after fact just smacks you in the face, and when faced with blatant fraud, manipulation, and lack of accountability (of even those who are supposed to regulate the industry), blatant handouts, whistleblowers who are ignored by the authorities and then nearly killed (look up Andrew McGuire, CFTC, and silver) - there's just no way to deny all that.

… so I don't hold the sheeple to blame, but they are the ones who will end up suffering the most. I truly feel bad for them. Hopefully, sites like this one may wake some up before they are financially slaughtered, but the vast majority will devastated.

Keep up the good works.

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written by Jeff Nielson, January 29, 2012

Nice one Dylan!

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written by Dylan, January 29, 2012

Great expose Jeff

Tt`s always worth pointing out that in addition to printing fiat they also counterfeit paper/digital gold and silver as well to suppress the price.

There is a huge difference between disgorging real quantities of bullion into the economy in order to suppress the price(insidious as that is), and, convincing people through deception that the bullion they hold in trust is actually there or that bullion in general is in abundance in order to suppress the price. The latter explains why both gold and silver should be multiples higher NOW.

Like the parrot seller in the famous Monty Python sketch,http://youtu.be/Oj8RIEQH7zA, Jon Nadler and his ilk`s sole purpose is to convince the masses that the canary in the coal mine is alive and well when it has long since joined the choir invisible.

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