Commodities - The Coming Bull Market Message Board

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Strategies & Market Trends : Commodities - The Coming Bull Market

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To: Claude Cormier who wrote (788)	9/12/2001 6:20:36 PM
From: craig crawford	Read Replies (1) of 1643

Identifying Risk in the Silver Market rsic.com One vital aspect of the supply-demand picture shows you why the silver market remains potentially explosive. Conventional sources - mine production and scrap recovery - supplied only 77% of world demand in 1997. 15% of total supply was accounted for by disinvestment from stocks held by investors in that year. [Slide 4: Silver: Implied Disinvestment 1987-97] This disinvestment was not an isolated event in 1977. It occurred again in 1998, though on a smaller scale, and has been a regular feature of the silver market throughout the past decade. In other words, stocks of metal held in bar and coin form are being depleted every year in order to meet conventional demand from the jewelry, photographic and electrical industries. It is not my role to forecast the silver price, but I want only to point out that this depletion of stocks cannot continue indefinitely. It could be eliminated by an increase in supply, or by a reduction in demand from fabricators, but either solution is likely to be associated with a rise in the price of silver - a point that has been well appreciated by Mr Warren Buffet, and other bulls of the silver price. The silver market therefore has all the uncertainties of any widely traded metal market, plus the additional excitement imparted by a structural deficit which may one day drive the price sharply upwards. Christopher G. Stobart, Managing Director Silver Markets Seminar, May 6, 1999

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