Bob, I've had a chance to read the report and have a few comments.
First of all, the thing is too long. There's too much repetition of the same causes and effects on each and every little figure. Oh well.
The sense I get of the whole report is the silver situation is in a big balance. Yes, we have had deficits, but they're worked off now, and the world had huge stockpiles for years it didn't really need.
Yes, North American production is down and base metals are having a tough time, but mines are getting more efficient and others are picking up the slack. Yes, digital photography is real, but.... (you can fill in the dots).
The one effect the report mentions worth noting is the dis-hoarding by manufacturers. The lean and mean "just in time" business ideology is apparently being adopted by cash strapped photography and electronic firms. Overall, I don't see it as particularly bullish for silver, they're just managing their silver stocks better.
What this balance means is every little straw on either side can move the market... for a while. The most recent example is the hedge funds going short and moving the price from 4.60 to 4.30 . The pressure is off now and the price is back to 4.60 . I thought the most telling figure in the report was number 28, which overlays the silver price and Chinese sales. Again, as long as that selling continues, the balance is here.
So, does that mean 4.60 is the equilibrium price for the next 5 years? What factors are there which will initiate a trend? I don't know. I'd hate to say silver prices have reached a permanently low plateau, as it conjures up that famous quote by the economics professor in 1928 about permanently high plateaus in stocks.
"It will fluctuate." is the best I can do and hope my trader's skills can get me through. I like trading precious metal stocks. They're firm over the longer time frames right now, and I don't like the odds for the US dollar, but silver stocks will fluctuate, LOL.
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