Doc @ Silver Doctors: Retail Silver Supplies Are Disappearing – Shadow of Truth #53

TND Podcast Spotlight:  Shadow of Truth

People also need to recognize that the gold and silver shortage is real. We’ve got the Royal Canadian Mint, for example, not being able to supply silver coins without a lengthy time delay…Eric, you and I believe the metals are headed for a complete turnaround that’s going to astonish everybody. If we look at the 90 percent junk silver bags. I deal with one of the largest companies in the world and what we are seeing is what I call ‘The 90 percent factor.’ Historically, when gold and silver are set for an explosive move, 90 percent bags become virtually unavailable.

When the biggest suppliers in the industry, and I’m talking directly with two of them, are saying ‘We can’t even get 90 percent bags and we probably won’t be able to fulfill any order for at least 8 – 12 weeks on those,’ you know we have serious supply problems. So 90 percent bags are virtually unavailable at these prices and those who are primary dealers in them can’t even acquire them.   – Steve Quayle on King World News

The Federal Reserve and the bullion banks are now blatantly manipulating the price of gold and silver using paper gold and silver, which can be printed in unlimited supply.  They no longer try to hide or disguise their operation and certainly never deny that they are constantly intervening in every market – not just the precious metals – in order to disrupt and prevent the valid price discovery mechanism of free markets.

I’ve always said that 90% bags are the leading indicator of impending market shortages…we saw that the week before the big smash-down in the silver price the first week of July, when premiums on 90% bags spiked.  Then around July 6th or 7th,  90% bags went “no offer” at the largest market maker of 90% bags in the U.S. at the wholesale level.  And it’s been “no offer” ever since. – Doc fromSilver Doctors on Shadow of Truth

I used the quote at the top because it independently confirms everything we heard from Doc at Silver Doctors today, who told us that across the product spectrum silver coins are selling out at the wholesale level.  The only reason this can be occurring is because there’s a shortage of unrefined silver that has developed globally.

The U.S. mint production has been going down about 20% per week. The first week they resumed sales the total allocated to authorized dealers was 1.4 million coins, the next week it went down to 1 million, last week it was down another 20% and I haven’t heard the number yet for this week. The Royal Canadian Mint didn’t take any orders last week and they’re not advising when they’ll resume taking orders for maples.  – Doc

China and India are primarily attributed with importing most if not all of the annual mined supply of gold for the past couple of years and both are on track to import a record amount this year. But very little is mentioned about their silver consumption. India is on track to import a record amount of silver and China is using all of its internally mined silver to supply its massive solar program (see this SoT podcast:  Solar Energy Drives Silver Demand).

The reason it’s important to understand the retail demand function for silver is because, at the margin, it will be the retail investors who will “tip the scale” on the Government’s silver manipulation operation and force shortages that will overwhelm the naked paper short interest, both on the Comex/LBMA and in the OTC derivatives market.

Rory and I visited with Doc today because we wanted to hear first-hand about what he’s seeing in the markets which feed into the retail supply for silver investment products.   The only time premiums across the board for retail silver products were higher than they are right now was during the 2008 take-down of gold and silver. There were a lot less retail participants back then, which means that the current market has been set-up to become even more extreme than it was in 2008.

Of course, do not overlook the fact that the price take-down and shortage of metals back then preceded the Great Financial Collapse, because we know that current fundamental conditions are worse than they were in the period leading up the de facto collapse of the financial system.

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About Dave Kranzler:

 I spent many years working in various analytic jobs and trading on Wall Street. For nine of those years, I traded junk bonds for Bankers Trust. I have an MBA from the University of Chicago, with a concentration in accounting and finance. My goal is to help people understand and analyze what is really going on in our financial system and economy. You can follow my work and contact me via my website Investment Research Dynamics.  Occasionally, I publish on Seeking Alpha too. As a co-founder and principal of Golden Returns Capital, LLC Mr. Kranzler co-manages the Precious Metals Opportunity Fund, a metals and mining stock investment fund. 

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