PMMaven

Comex Silver - Another Bubble or Desperation?

The strictest definition of a hedge is to offset risk. People universally use the term incorrectly. Primary producers and consumers can NOT hedge. They however can fix prices by selling futures. How does that eliminate risk. What if a mine sells its future production on COMEX and then the price goes up. They lose out. And what if a consumer buys futures on the COMEX and the price goes down. They lose out. Merchant Banks(Commercials?) are resellers of a commodity. It doesn't matter if they value-add to the commodity or not. They buy in the cash market and sell in the futures market. That is a true hedge. When they sell they cover their short. Hence no market exposure. A contango market pays them a little bit. I could go on w/ how they profit by writing options and managing the hedge ratio. But that's all for now.

Comex Silver - Another Bubble or Desperation?

What portion of Commercial Shorts are Cash & Carry hedge positions? Are any active silver contracts in backwardation?

Silver Trending Towards Backwardation Again

The month that counts is DEC. SEP & OCT are silly. Liquidity is important. Is DEC backward?

Export of 'Gold Compounds' a Booming Business

Keep in mind, there are many gold compounds used by industrial companies. The actual gold portion of the product weight can vary greatly to as low as a few % up to 80-90%. If the value (selling price) includes fabrication costs the actual gold value of the sale could be very low. For instance, gold paint's (poor example) gold value is probably less than 10% of selling price.

Rhodium: The Most Precious Precious Metal

Elemental Rhodium is not toxic. Are there any Merchant Banks making a market?

The U.S. Mint Again Suspends Gold Coin Sales: Is It Really Out of Gold?

Seems to me the only poster who knows what he is talking about is kahalakid. Also someone the other day thought 250M TO Silver was a lot. You gotta be kinding.

Shorts Unable to Stop Silver Rise

This is very confusing. Are these "Commercial" shorts banks. I am under the impression that silver resellers acting as merchant bankers would undertake a classic Cash and Carry hedging program. And what does annual silver mining output have to do with above ground inventory?

U.S. Mint Actions Discourage Gold Ownership

I agree with smarty-p. I have always thought that the mint could only use Au mined in the US. But aren't there situations where it is difficult to tell where the Au was mined? I assume there are.

Gold Breakdown

The amount of almost universal lack of understanding of how the gold market operates that i observe in all recent commentary is beyond belief. The cash market (London gold ring) is operated by 5-6 market makers. The number has changed over the years (JM got kicked out, Mocatta was taken over, etc.). They trade with each other depending on their needs and publish for convenience sake an AM & PM fix for purposes of settling with their customers. Basically they are bonifide hedgers, trying not to speculate.

If you are a cash & carry hedger and embark on an option writing program needing to write to a neutral hedge ratio daily you will have hundreds of options being traded.

Gold just trades inversely to the USD (not 100% though).

Premiums Paid for 100 Ounce Silver Bars

When you take 'delivery' from COMEX, you receive a 'warrant" for metal at the certified warehouse. This is after you've ponied up the dough. In the past you had to hire a certified shipper to physically pick up the metal at the vault. Is this till true?

Manhattan Real Estate Is Teetering - Barron's

Judy is an editor, not a news writer!

Gold Futures' Dirty Secret (Part II)

Referring to a primary producer as 'Hedging' when he sells futures is incorrect. I know that it is said universally, but it is really price fixing. They still have market exposure! Hedging is when a Merchant Banker buys in the cash market and sell futures. A primary producer or consumer cannot hedge. If you want to take physical delivery off a public futures exchange (e.i.-NYMEX, COMEX, etc.) you pony up all the money (after all the final notice stuff); then you will receive what is called in the trade a 'warrant'. Then you contact a certified carrier (Brinks, etc.) to pick it up at the certified warehouse (Chase Manhattan,etc). And deliver it where you want. Keep in mind all this stuff cost money.