Silver is making a move on this fine monday morning. My good mood is seeping through not because of my coffee, but the metal of my character. I bought silver in the dips last week. I bought bullion and coins to be specific. I will happily give away USD for real metal. Why silver, why now? I'll be brief.
Festival is starting in India, so immediate demand is trending higher. Are you kidding me. Thats what it takes to drive up spot, India? This is SILVER!. Now I find that amusing. I must digress. We will react to India's Jewelry consumption as a market driver, but not industrial uses. Electronics, medical uses, solar panels and even clothing are consuming silver at an alarming rate. I just read the other day from a Richard Daughty article that our above ground Silver stores has gone from 2.2 Billion Oz to 300 million in the recent past. In a laissez-faire market shouldn't silver be rocketing up if silver demand is higher and supply is lower? Tyaa, sure. But there's more to the equation, or more accurately, more fingers in the pie.
Silver ETFs for one are distorting the picture. These paper giants cannot possibly all be backing their holdings with bullion, or silver would be higher still. Who else would benefit from manipulating silver? Banks don't generally like missing trends, if fact they are in the business of creating and manipulating them. It was the central banks in Mexico that squelched a move to the silver standard there. Why would they do that? It must be that their stock piles were already sold off, so they would not benefit from the move. Nothing else makes sense.
So stockpiles are down in Mexico, and very likely in other countries (assumption). The markets have be artificially depressed by the COMEX and other banks (their shorting is well document of late). ETFs are not helping because little to no silver is moving, or simply moving from one holding place to another. I will give them that. Industrial uses are on the rise, and yet silver production is not keeping pace.
Silver gurus have been calling for this scenario for years. My head is sceptical having been burned on silver trends in the past. My gut says buy more silver. The illusion of silver being in endless supply and of little use is breaking up. Why now? Why not?