The COMEX seems to be the main culprit for the stagnant price of silver. In spite of the fact that there is very little of it in stockpiles, if any, silver prices continue to languish. Here’s one reason. When people “take delivery” of their silver contracts, which are in ugly, heavy, thousand ounce bars, they leave them at the COMEX!
This is comparable to buying groceries and leaving them at the grocery store. If they are in the COMEX “warehouse,” they aren’t in your possession, and unavailable if you need them. Similar to various precious metals firms, especially the one I started out with back in the 1970’s, “storing” clients’ gold for them. Nuts to that. Millions were lost, when North American Coin and Currency went down the tubes, and their officers went to jail. It has been reliably estimated that from 4 to 8 large traders are manipulating silver by continually trading long and short over 300 million ounces of silver which doesn’t exist. Even though it is against all rules and ethics to do so, the daily manipulation continues.
No one wants those thousand ounce silver bars which the COMEX delivers, because they are difficult to ship, never weigh in at 1,000 ounces and should be disposed of if they are acquired. They usually are not delivered, but sit in the “warehouse” if they are there at all. No, I am not saying the 1,000 ounce silver bars are not there, but has anyone ever seen them? Is it possible that they are not all there? The COMEX doesn’t even have a “warehouse,” first of all. The “warehouses” are deposit receipts for silver supposedly stored at various east coast banks. Does it exist? Are the deposit receipts valid? Is everyone honest? Is the Pope a Protestant? I feel quite certain that there isn’t a dime’s worth of gold in Ft. Knox, even though the reliable US government claims to have over 8,000 tons of gold. I’d be willing to bet they haven’t an ounce. If they did, why do they have to buy gold on the open market to make Gold Eagles? Why don’t they take it from Ft. Knox? Where do they get their silver? They admit they have none in their vaults. Does the US government get silver from COMEX deposit receipts, and take delivery from various storage banks to make Silver Eagles? I don’t know, but I do know that if you want silver to go up, you need to take delivery of it, and especially if you trade silver contracts.
Paper silver doesn’t have any value, any more than paper dollars. Paper silver or COMEX deposit receipts, are only as good as the physical silver which backs them. Do banks have a lot of paper money if you wished to get say $25,000 in cash. Hah! Try it. You just can’t imagine the chicanery that goes on in the financial world. Banks can loan ten times as much as they have on deposit, thanks to the fractional reserve banking system. Is it remotely possible that COMEX deposit receipts for thousand ounce bars, supposedly stored at various banks on the east coast, can’t 100% be delivered? Are banks honest in their other actions? Is the Fed honest, when it prints billions and trillions of fiat dollar bills, which are redeemable in nothing? As an example of honesty in high places, take this quote from the latest Forbes Magazine. “The U.S. Federal Trade Commission has created more than a dozen Web sites touting such products as income tax avoidance, weight loss without exercise, huge travel discounts, and $100,000-a-month home businesses. The Feds insist they don’t collect data on anyone” And pigs do fly, correct? If you buy silver, or take delivery of a fulfilled contract, GET IT!
By taking delivery of silver, you increase the demand. If you trade silver, and let it sit in a warehouse, rather than in your safe or wherever you may store it, the demand is not increased. If you bought groceries, and left them in the store for someone else to take delivery of, even though you may have paid for them, the demand is not from your purchase, but from the person who comes along, buys, and takes the groceries home. I have one client who takes delivery of those thousand ounce bars, because he doesn’t trust the COMEX receipts to be reliable. Sure, they are bulky and not even pretty, but by taking delivery, they are yours, and the demand has increased. By not taking delivery, the silver inventory remains constant, and prices are not likely to go up. If times are going to be as rough as I think they are going to be, one needs to have their metals at hand.
One web site says that gold should be stored in Switzerland! Of all the asinine advice ever given, that takes the cake. You own gold to hedge yourself and protect yourself, correct? Then why would you want to store it any place but in your own home or place of safety and easy access? Gold ten thousand miles away, is an absurdity, just as is gold in some account off shore in the Caribbean or other inaccessible place. If times get rough, as we thought they would with Y2K, would you have stored your food, water, generator or flashlights in a distant city or country? Of course not. If you go out in a boat to catch some fish, do you leave your life preserver on shore? If you go for a swim, do you leave your swim suit at home? Why would you leave your silver in a warehouse, your gold at some distant place, or your food in the grocery store, and especially after you have paid for it? Honestly, I sometimes think I am writing to first graders.
Maybe, if Futures traders of silver began taking delivery of those bars, and converted them into decent hundred or ten ounce bars or silver rounds, the price would go up, because the supply of available silver would decrease, and force the day of reckoning that much sooner. When hard times come, you want your safety devices close at hand. If the COMEX racket isn’t stopped, the day will come soon enough anyway, because there just are not any silver reserves worth mentioning. When my rounds and ten ounce bars are manufactured, they are made from melted down thousand ounce bars, and I assume Johnson-Mathey does the same when they cast their hundred ounce bars. The thousand ounce bars are .999 pure. The problem with them is that they are incredibly heavy, and never weigh in at an exact thousand ounces. Get them, sell them, and take the silver back in hundred ounce bars or lower sizes that are easy to handle, and simple to sell when one wants to do so.
Everyone places so much trust in huge organizations and corporations which may not be worth a hoot in hell. I’ve seen metals “storage” outfits not have an ounce left, when claims were made. I’ve seen banks go bust. I’ve seen stock frauds and mining frauds galore. Why should one trust the COMEX to have your silver? Maybe it has most of it. Maybe it has all of it, but it belongs in your hot little hands, not in some eastern bank’s vault. Your gold belongs in your place of safe keeping, not in some obscure place across the waters, with you holding a receipt or checkbook, which is supposed to be the same as physical. It isn’t.
How many men have come home, found their homes empty, and a note saying, “goodbye?” Marriage is supposed to be the utmost form of trust, but half of them go bad and 75% of them are broken by wives who were trusted. The most intimate, close relationships gone asunder, and the victim never mistrusted the other party. Why then, should you trust your precious metals to some bank or storage facility? Why should your gold be in Switzerland, of all places?
Hot off the wires! More new paper, fiat “money” will be announced in a couple of weeks. This time it’ll be in colors besides the usual green. How long before they say, “Your old dollars will be no good after ..date?” (Shades of Germany in 1924 and 1948) Protect yourself.