I respectfully disagree with Saville on silver prospects
he falls into the same trap that we all piss & moan about economists falling into
he uses past data, but fails to acknowledge severe changes in the landscape that make comparison and pattern recognition full of pitfalls
for instance...
in the late 1970's, silver was nowhere near depleted in the US Strategic Silver Reserve
the USMint was actively coining silver
the Hunt Brothers temporarily cornered the market, but there was plenty of vaulted silver lying around to thwart their efforts
the Hunt Boys were busy in a time when there was little in the way of short positions, and plenty of speculative longs
world silver demand was nowhere outdistancing supply
China and Japan were nonentities in the silver world
today's environment could not be more different
the USMint and Strategic Silver Reserve announced in March of 2002 that they are 100% out of silver !!!
speculative longs in silver are absolutely overwhelmed by commercial shorts
in fact, the short position is frightening
now we have George Soros, Bill Gates, and Warren Buffet each making large bets in favor of silver, both in physical silver and ownership of silver mining companies
world demand is now twice the known stated silver supply, on an annual basis
in fact, a decade of neglect has shut down a great deal of silver production, bringing this market to a new crisis stage
China and Japan are now major players in gold & silver
and China has become a major smelting refiner
they could easily arrange to withhold 20% of the refined silver from raw ore shipped to their shores from the west, thus severely impeding silver supplies, causing a sharp rise in price
I point out this poor analytic approach constantly
one can use history, but it is essential to note similarities and differences, since they can often torpedo the arguments and conclusions
this curreny era is in no way commensurate with the late 1970's
in fact, I see absolutely nothing in that decade that remotely resembles the present timeframe
that was a time of shortages, price runups, price inflation attempting to resolve those shortages after OPEC raised prices, VietNam bills came due, and the USFed went on a reflation binge that only now is being rivaled
now is a time of overcapacity, debt collapse, busted asset bubbles, and a mad scramble for assets that avoid decimation
this is a very weak premise and analysis by Saville
it sure sounds good, nicely written
but the logic and analytic basis is missing
I expect silver to break north of #490 in the next 30 days
its confirmation of the gold breakout is necessary, warranted, and expected
especially since some experts doubt it, like Saville
investment demand for silver is about to perk up
some money will come out of gold, and into silver
other money will chase silver, since gold has made a nice run
I rest my lousy reputation on it
SILVER IS A SHORT SQUEEZE JUST BEGGING TO HAPPEN !!!
it could be engineered by a single person demanding delivery on a large number of silver futures contracts at COMEX
or any group of wealthy individuals demanding physical delivery
what amazes me is that nobody has seen fit to squeeze this market when it could be done with only a $20-50M
/ jim |
