Metals on the Move

ALRIGHT WHO DID IT
Who bought a couple ounces recently to add to their pile?

 

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Not me. I don't even have a show coming up this weekend where I'm looking to sell.

 

Here is a decent article from the Jerusalem Post regarding the Billion dollar loss of US banks shorting silver.

Silver Prices Surge: Banks Face Billion-Dollar Losses

https://m.jpost.com/business-and-in...udratf9atleflus5wg_aem_eroyhmrqsukvnds252rnqw
And another article from Yahoo Finance.
https://finance.yahoo.com/news/five...CjWMQqRpnDC1KMm6kLI76VAbS7U2fhV3z97N29duytes-

 

According to recent reports, the five US banks most prominently shorting silver currently are: JPMorgan Chase, Citigroup, Goldman Sachs, Bank of America, and Wells Fargo; however, it's important to note that identifying the exact short positions of individual banks can be challenging due to the lack of publicly available data on their specific trading activities.

 

My understanding is that they are still short and their losses unlimited.

These banks also, I believe, practice "reserve banking" with physical silver. They sell the same bar to many customers, charge a fee to dust it, and then protect their interests in the futures market. In other words they not only have to get out of their shorts to limit their exposure to losses but then they have to buy silver at far higher prices or get sued by their customers who think they own silver. Some have suggested a single bar of silver might have as many as 100 owners and the bank that does this might be short millions of ounces.

One bank that did this transferred the little metal they had to another company as they went bankrupt. The shenanigans going on now days are scary.

 

These shenanigans in silver have resulted in ridiculously low prices for many years and the diversion of production into landfills to profit a few rich people. It also has helped make planned obsolescence that diverts large amount of materials and human effort into landfills in the form of air conditioners that have to be scrapped after only a few years as well as many other products.

Now the rich people will do what they do to profit on higher silver prices by taking silver. They will blame the victims for a "shortage" that they themselves created through waste and greed. They will blame it on "speculators" and "opportunists"; "carpet baggers". They will change the laws so after causing mayhem making greedy profits they can make even bigger profits. And we will be even poorer yet.

Living in interesting times is not good.

 

Windfall profits taxes will be enacted and this money go straight to those who caused the problem by wasting resources in the name of producing more CO2 which will make them richer by "fixing" it. Being too big to fail means we pay the price and because the economy can't function without silver there is no choice but that it is available.

Nobody will go to jail and the mechanisms that allowed this to happen will stay in place as those who profited from all the greed and waste will now profit from finding a "solution".

This is the canary in the coal mine that is falling over and was killed by kicking the can down the road for many years. If this is really the case as it appears to be then there is no kicking this can down the road. They can short sell a trillion ounces of silver and push the price back down to $14 but it's just going to bob back up like a cork in a tub of quick silver

 

I believe they are beginning to understand this. This means that they must go into the market and buy silver to cover their shorts. This leaves no sellers and millions of buyers. This will lead not to selling because the silver is in landfills but rather it will lead to more buying as industry that runs on silver races out to secure delivery in uncertain times.

If they don't cover their shorts they will leave everything exposed. They can scrape together a couple hundred million ounces to flood the market but this won't last either. It's just enough to cover the deficit for a couple years. The irresponsibility of such a tactic would be monumental and they still couldn't cover their shorts.

The only way to stop the waste is to let the markets decide the price.

 

https://www.jpost.com/business-and-innovation/precious-metals/article-826085

I've been saying exactly this for 45 years ever since they rigged the market to break the Hunts. Nobody listened. I said there would be a day of reckoning when silver suddenly was revalued and it would shake every market. I said that the longer it took the more dramatic it would be. I never thought it could go until there was actually a continuing silver deficit and the gold/ silver ratio was over 80: 1.

Silver consumption is at the very bottom of a parabolic increase and most of the physical silver in the world has been wasted and it not recoverable because of the short sighted behavior of people profiting from its destruction.

The price of silver will be a limiting factor on the human race until we can either mine the seas or asteroids. Unfortunately, if and when the seas can be mined the price of gold will collapse because it is far more plentiful in the sea than in the ground. Any silver mining will return a great deal of gold in, I believe, about a 1: 4 ratio. ie 1 Oz gold to 4 Oz silver.

There will be more uses for silver every year for a very long time.

 

That ratio is low.
2023 worldwide production exceeds your ratio.

2023:
Gold 3,000 metric tons
Silver 26,000 metric tons

It's always been severely swayed to silver outproducing gold. As a matter of fact, silver is a byproduct of gold mining.

 

I'm aware of this. Indeed, it used to average about 16: 1 historically.

But the oceans apparently contain a far higher percentage of gold. I haven't looked at the numbers in decades and I just saw one single sample and these might vary by depth or even location but that sample was about 4: 1

It would be a good idea to look yourself.

This technology probably will exist eventually but I'm sure when we do mine the seas that it will require quite a bit of silver and much less gold.

 

I never thought of it like this before but this number is little larger than the throughput of a single large iron blast furnace in a single day.

There are dozens and dozens of such large furnaces and, I believe there are still hundreds of smaller ones still operating.

It kindda puts things in a different perspective.

All the silver production mixed with all the steel production would barely even contaminate the steel.

 

Well, yeah. We make more steel than almost anything else, certainly any other metal.

I'm seeing figures of just under two billion tons per year of steel produced annually. There aren't many things humanity produces in larger quantity. All foods put together? I'm seeing 4 billion tons/year most commonly, although I'm also seeing 9.8 billion tons/year.

If you don't count water (which we don't exactly "produce"), it looks like the most-produced material is concrete, at 30 billion tons per year. Good luck finding any silver coins you drop into that while it's pouring.

 

Almost all concrete now is poured with steel reinforcement so even a metal detector won't help find the half dollar.

Almost any contamination of some steels require it to be scrapped or reworked but if all the silver were mixed in it wouldn't matter. One part per million of silver wouldn't matter to much of anything. The silver in most ores I believe would come out with the slag anyway. Much of what did get smelted would end up in the monkey below the tapholes. This just really puts it in perspective for me.

We tend to take everything for granted but 26,000 tons is almost nothing. The Great Pyramid weighs 24 times as much. The silver is used in thousands of processes and products including some with more silver than iron in them!

 

https://www.google.com/gasearch?q=electronic silver uses&source=sh/x/gs/m2/5
Never gonna be enough silver

 

Hence the reason silver is labeled a commodity and precious metal.

 

I’m glad that I don’t bank at any one the 5 banks that are shorting silver.

 

Top 2 US banks shorted an unprecedented 1.4 Billion oz of imaginary paper metal. I hope they go broke! Absolutely criminal

 

Unless this is an attempt to balance clients long positions, it’s a bad position to be in
Had some stock in two large banks. Sold yesterday.
Gold, silver, high dividend stocks, defense stocks
And I’m an optimist
I’ll be on my boat in Florida next month