Months After HSBC Acquitted of Silver Manipulation, Bank Begins Acquiring One-Fortieth of Polish National Debt In Silver

Having rallied for eight days, correcting upwards in response to intense downward manipulation as well as inflow into silver backed ETFs and physical demand, silver is sitting on fundamentals better than ever during this recent bull market. Whereas for the past decade it was a surprise that silver ran and ran and ran, if silver doesn’t rally in 2015 THAT will be the surprise. You following us here at SV? That means silver sentiment is hovering near familiar lows. 6% rallies this year has meant that silver is one of the top performers of the 2013 YTD.

These are some reasons that, despite bearish gold forecasts provided to the public in 2013, HSBC has moved – quietly, of course – into acquiring incredible amounts of silver bullion. The bank – which was originally named in the suit against silver custodians and manipulation – has purchased $876 million dollars worth of silver bullion or approximately 27,375,000 ounces of silver in the past year. The purchase from KGHM, one of the largest producers of silver in the world and the second-largest producer of refined silver, located in Poland, unfolded over a year’s period, beginning directly after HSBC was acquitted from silver manipulation allegations. Their silver bars registered under the brand KGHM HG come with certificates issued by the LBMA and the Dubai Multi Commodities Centre.

Further, according to a KGHM market filing last week, the listed metals producers KGHM signed an estimated PLN 1.67 billion deal on 2013 sales of silver to the London/Hong Kong based bank that specialized in expatriate banking and held the most amount of silver when charges were pressed by GATA.

The contract was announced by the Management Board of KGHM on 21 January 2013. This is the highest value contract signed over the last twelve months between the two parties. As one of the largest companies in Poland, the deals essentially represent a gutting of that central European nation. In the current context, The Troika is “securing” Poland’s silver, thus “insecuring” Poland from valuable national resources. The main Polish customers in recent years have been the UK, Germany and Belgium. HSBC, furthermore, has been one of the main customers over the last year, marking a period that began in the immediate wake of the GATA filings.

According to the CIA Factbook:

Poland has pursued a policy of economic liberalization since 1990 and today stands out as a success story among transition economies. It is the only country in the European Union to avoid a recession through the 2008-09 economic downturn, although GDP per capita is still much below the EU average. Since 2004, EU membership and access to EU structural funds have provided a major boost to the economy. Unemployment has been 2% more than the EU average. Inflation reached a low of about 2.6% in 2010 due to the global economic slowdown, but climbed to 4.3% in 2011. Poland’s economic performance could improve over the longer term if the country addresses some of the remaining deficiencies in its road and rail infrastructure and its business environment. An inefficient commercial court system, a rigid labor code, bureaucratic red tape, burdensome tax system, and persistent low-level corruption keep the private sector from performing up to its full potential. Weak revenues, together with rising demands to fund healthcare, education, and the state pension system caused the public sector budget deficit to rise to 7.8% of GDP in 2010, but the PO/PSL coalition government, which came to power in November 2007, took measures to shore up public finances – including increasing contributions to the public pension scheme at the expense of private pension funds – and reduced the deficit to 2.9% of GDP in 2011. For 2012 the coalition government has proposed further deficit-reducing reforms and to fulfill its promise to enact business-friendly reforms.

Adhere to the international lender demands, and you can’t be too sure of your national future.  The silver amount purchased by HSBC in the past year represents a portion of Poland’s GDP, which stands at about $500 billion (as of 2011).  With a national debt of about $46 billion USD, HSBC has effectively purchased nearly one-fortieth of Poland’s national debt in the form of an asset many people expect to increase by approximately 500% according to some upper end analysts.

More mining is expected in the region as South Africa turmoil has led many to suspect corporations will move to their operations to stabler regions, thus gutting S.A. of jobs.

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