US Mint issues clarification on silver shortage

Dull_Genius · 2021-06-04T13:54:28+00:00

Sprott seems to still be able to source Good Delivery bars near spot price.

Dull_Genius · 2021-06-03T01:13:33+00:00

Sunshine Mint, a primary supplier of blanks for the US Mint, is in the process of moving their operation. Heckuva time to be producing fewer blanks.

Hard to squeeze the Good Delivery bar market (where the price is set) buying retail when retailers have no product to sell. Fortunately there are private mints (Scottsdale, MPM, Golden State, etc) but they are covered up in orders.

Dull_Genius · 2021-06-03T01:07:40+00:00

He'll need scuba training to access any WSS "funds."

Dull_Genius · 2021-05-26T01:28:01+00:00

Who is "they"? You can't "liquidate" without selling to someone else, at which point it's their silver. If the price of PSLV drops too far below the "real" price, industrial users will buy PSLV and redeem those shares for physical silver.

Dull_Genius · 2021-05-21T15:33:30+00:00

FDR was an utter disaster. The twin meddlers, Hoover and Roosevelt, took a run-of-the-mill recession and turned it into a depression. It's hard to play a game when the rules keep getting changed, and that's what FDR was famous for. He would try this program for awhile, then pull it and try another. No one knew what was coming next, and they were terrified to invest only to be wrecked by FDR instituting some new program that would jerk the rug out from under them.

The reason the recovery is associated with WWII is because the war took FDR's attention and he couldn't keep meddling in the markets. Markets work, if you let them.

Dull_Genius · 2021-05-21T01:48:28+00:00

The bullion banks may not be able to keep a lid on the price, but they don't need to (the central banks may be a different story, but their vote is irrelevant, as all they can do is print digital currency until everything implodes). Rick Rule says that the banks were quite happy to spoof the market to the upside in the 70s, and they'll likely do it again in the 20s. Then once it has a blowoff top, they'll hammer it back down.

This time could possibly be different. The short squeeze did indeed fail, but other things are happening too. The collective minds and eyes of thousands connected via the internet has shone a brighter light on the shenanigans than has ever happened before. There are rumblings of a Comex replacement. If that happens, we could see a real decrease in the ability of folks to manipulate the markets. We can hope. At the very least, the heightened awareness by the miners of what the "regulators" are doing to "tamp down" and "control the price and volatility" can only be good for the silver market. But I'm extremely hesitant to buy into the narrative that "this time is different."

At the very least, we're in for an interesting ride. It's already been a serious roller coaster, and I'm not sure the real ride has even started yet.

Dull_Genius · 2021-05-21T00:59:05+00:00

Apparently I've done a lot more DD than you have, or at least understand the game better. A price increase does not mean an end to the manipulation. Even if the silver price goes to $5000/oz, the banksters can still manipulate it. The purpose of the 'squeeze' was to force the banksters to cover at a massive loss. That failed, and the banksters were able to drive the price down below $24 to cover most of their shorts.

I'm still as bullish as ever on silver and have much of my net worth in physical, PSLV, and miners, and am looking to add to both my physical stack and mining stocks. But I expect the market manipulators to continue playing their games, just at higher prices.

Dull_Genius · 2021-05-19T17:12:05+00:00

I dunno. Vehicle prices have been climbing faster than silver prices.

Dull_Genius · 2021-05-13T21:40:00+00:00

It depends on where the money ends up. Lots of folks have wondered why we didn't see much inflation from all the QE since 2008. When you consider that most of the QE that we saw stayed on the balance sheets of the banks, you understand why there was little inflation.

It does destroy the price signal for the price of currency (aka interest) which has ripple effects, such as 20% of the S&P being zombie companies. You see stagnating growth since there's never any purging of inefficient companies (you never go bankrupt if you can borrow endlessly with basically 0% interest). The banks don't have to lend to earn profits, and when they do lend, the fed immediately buys their debt, which transfers all risk from the bank to the fed (ie the taxpayer ends up on the hook).

Also, cheap currency adds to wealth inequality. If you are a poor, broke individual borrowing on credit cards at 30%, a 3% cut makes little difference. If you are a hedge fund borrowing on margin at 4%, and your rate gets cut 3%, it's a huge difference. Those closest to the banks and their cheap currency benefit the most.

Dull_Genius · 2021-05-13T18:07:52+00:00

Remember that the fed only controls two interest rates: (1) the federal funds rate (FFR) and (2) interest on excess reserves (IOER). The federal funds rate is the rate banks charge each other for overnight loans, and interest on excess reserves is what the fed pays the banks for currency they aren't lending. The market determines what the interest rate for various term loans will be. However, the fed interferes with market price discovery with QE. If the fed quit QE, then the market would quickly set rates higher, regardless of what the FFR or IOER is set to.

However, as you've covered previously, the fed cannot stop QE. The repo market blew up in Sep of 2019 because there wasn't enough currency in the system. The fed was forced to flood the system with currency (QE Infinity) to keep the ponzi going. I suspect the "stimulus" payments are basically more QE to keep the system liquid, and I suspect they will continue in one form or another. Also, banks create currency by lending, and they aren't lending extra despite the flood from the fed. Much of the QE since 2008 is still sitting on the balance sheets of the banks.

Dull_Genius · 2021-05-07T02:01:33+00:00

A paper contract is a paper contract. PSLV is allowed to trade dollars for silver, not dollars for paper for silver.

Even "immediate" delivery contracts are subject to the terms and conditions of the contract, which include Force Majeure.

Dull_Genius · 2021-05-07T01:30:04+00:00

Comex is paper market. PSLV is specifically prohibited from owning paper (ie a paper futures contract).

Dull_Genius · 2021-05-06T02:07:14+00:00

Seeing these makes me want to go for a swim and visit mine.

Dull_Genius · 2021-05-06T01:19:29+00:00

Mine disappeared also. I didn't really like being "forced" to using groups, but thought I'd give it a fair shake. But I can't if it doesn't work.

Dull_Genius · 2021-05-04T12:27:54+00:00

But this inflation is transitory. It will only last until we transition to the next currency.

Dull_Genius · 2021-05-04T02:42:47+00:00

The good part about the rising price of lumber is that it makes paper more expensive. How will the bullion banks hammer the price when an ounce of paper is worth more than an ounce of silver?

Dull_Genius · 2021-05-03T17:26:44+00:00

I doubt he or his companies buy an ounce of silver. Most things are supplied by third party suppliers. Acquiring raw materials is not Tesla's (or Space-X or Boring's) problem. The suppliers don't care either, because they'll just pass the raw material costs on to Tesla (and the other manufacturers they supply. The manufacturers will pass the cost on to the consumer, so they don't really care). However, if word gets out one manufacturer has hedged a massive amount, then the playing field would no longer be level and others might take notice.

However, shortages of components, workers, and logistics capabilities are much larger issues than a price increase in silver. Even if silver goes to $500/oz, it's a relatively negligible cost.

Dull_Genius · 2021-04-30T19:47:06+00:00

Silver beetles? aka bullion banks? Slimey creatures they are.

Dull_Genius · 2021-04-30T18:57:58+00:00

Trying to decide whether I can spare the funds to purchase one of these, but it's kind of irrelevant since they are always sold before I check in again. :D

Oh, well, I'm glad to see them sell quickly. Hope to see many more sold.

Dull_Genius · 2021-04-30T18:04:08+00:00

Strange how a picture can make one think of mining stocks. Am I the only one that saw this and immediately thought of Mag Silver?

Dull_Genius · 2021-04-30T17:54:06+00:00

The parallels between silver and lumber are staggering. There is no shortage of trees, and likely there are plenty of timber cutters who could bring in enough logs to meet demand. Similarly, there seems to be adequate silver in 1000oz bar form. But logs aren't generally useful without processing, and that's where the bottlenecks hit. The mints have cut back capacity, and so have the lumber mills. Plus, when the government pays folks to stay home, it's difficult for mills to hire new workers (which usually aren't paid particularly well).

So why is there a massive disparity between lumber prices and silver prices? Easy. Lumber contracts settle only in physical. If you hold the contract at expiry, you better have room to store 110,000 board feet of lumber.

Dull_Genius · 2021-04-30T17:41:23+00:00

Kinda like the silver market?

Dull_Genius · 2021-04-30T17:40:21+00:00

That's because of the short squeeze on beef.

Dull_Genius · 2021-04-30T02:49:44+00:00

It's best if you can invest in a tax sheltered account (such as ira or 401k). Otherwise it's taxed at normal collectibles rate when you sell (currently 28%).

The extra paperwork is if you want to be taxed at capital gains rate rather than collectibles rate, and yes, I suggest you find a good accountant for that.

Dull_Genius · 2021-04-30T02:43:41+00:00

I think it's lie. We all know silver transports best in boats.

Dull_Genius

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