Global Silver Shortage Warning

Unlike the 1980s silver market pump and dump this move in silver has been very controlled. In part this is due to the Hunt brothers infamous attempt to corner the global silver market. This move was ill-fated from the beginning. The brothers were attempting to corner a market that was controlled by the greatest banking power on earth and they had no idea what lengths this power would go to in an effort to stop their brazen plan. They certainly found out when the Treasury and Federal reserve used their influence in the Justice Department and the Comex to pull the rug out from under the bad boys from Texas.

Let’s move ahead three decades. The players this time are more amorphous. There is no single target for the Fed to get their crosshairs on. This time the move up in silver is a combination of several factors. Unfortunately for the fiat ponzi system, the large naked short position set up to control silver’s price is the very achilles heal for the ponzi. What wasn’t anticipated was the large consumption of silver through its commercial consumption during the last twenty years. Silver is one of the world’s best conducters and its special properties have made its commercial use extremely valuable int the new digital boom. With the large short position artificially keeping the price low the metal was ravenously consumed by the burdeoning manufactures around the world. Insidious accumulation of the metal was simultaneously being made by a number of large hedge funds that recognized the coming above ground shortage of the metal as no new mining was being established. Companies like SLW were making preparations with committments for very inexpensive silver contracts in expectation for the anticipated shortages and concomittant price explosion.

NO ONE could have anticipated the coming financial armageddon of 2008 (sarcasm intended) and the loss of CONfidence in fiat currency was well on its way around the world as liquidity dried up and Central Banks began printing fiat as fast as possible to prevent a deflationary collapse. Attention turned to Gold as people looked for real money to protect their wealth. Central Banks stopped selling gold and became net buyers, but no one was watching the poor man’s gold….SILVER. It quietly moved up throughout 2009 and into 2010 until it exploded in a final 60% up move in late 2010. Now the PTB saw the trap that had been laid and were in full panic. If they didn’t begin covering their shorts then the bullion buyers could accumulate the metal at low prices……and they did accumulate. The more the paper shorts pushed price down the more the bullion was accumulated.

Now we are at the ultimate crossroads of the silver ponzi. Don’t expect an explosion overnight but the days of languishing cheap silver is long gone. We are in the final days of small silver price moves. From a traders perspective this is the last days of Pompei. Enjoy the theater. Full disclosure long SSRI SLW PSLV PZG EXK.

Read more at Great Depression 2