Monday, December 10, 2012

Some Thoughts on Silver

First my positions. I own physical silver and shares in PSLV. I plan on buying SSRI as early as tomorrow.

I have been doing a lot of silver research over the past two weeks. There is very good evidence that the supplies of silver are very tight and that a silver surplus- does not exist. 

Please remember that just because silver is 50 times cheaper than gold does not mean silver is 50 times more plentiful. In fact, there is strong evidence to suggest that the only thing keeping the price of silver down is market manipulation and specifically two banks. Here is an eye popping report showing short positions and a potential price explosion in metals. The top report on the GATA site.

Not only has the price of silver been solid for the last few weeks, but I have been seeing serious buying action at the silver miners. SSRI was up nearly 6% at one point today.

In fact, on a day when the DJIA and other averages were pretty flat, all of the silver miners that I track were showing green on my 60 stock watch list. 


Historically, silver has traded from levels of 15 to 20-1 with gold. A move up, over 100% from here, will still not get silver to historical norms. That's why I am a silver investor now. That's where I am focused.

A significant problem is taxes. If you are buying silver stocks or positions in a trust like PSLV...if you want to take some money off the table...Uncle Sugar is going to be there with his hand out wanting his cut. Selling a few ounces here or there, is not reportable like short term capital gains on a sale of a stock or trust. In fact, because of the huge potential for gains and rising tax rates, you are probably better off buying the real stuff. In the smallest increments that you can.

I wouldn't wait too much longer. The supply is very tight.


Anonymous said...

Ted Butler has been saying much the same thing, that there is actually less silver than gold because it has been eaten up by consumption (with more uses for the stuff appearing daily) and buried in landfills, and that the only thing holding it down has been blatant manipulation. On the subject of silver miners, take a look at First Majestic.

MizuBob said...

I wondering what you meant by buying in the smallest increments you can.
1/2 oz? 1/10? Or am I completely missing the point?
Thanks for your time.

Anonymous said...

Perhaps what Brian is saying is that rather than buying a 1000 oz monster slab, buy in units of 1, 5 or 10 oz. It's a lot easier to sell and is more easily verifiable for both seller and buyer, an example being the 1 oz American eagles or even junk silver (quarters and dimes dated 1964 or earlier). I don't know if this is what Brian means, but it's what I would do.

Anonymous said...

Buy Silver in junk bags pre dated 1964 and use it for everyday living, gasoline, food etc. If you can afford Gold buy and hold. When T.S.H.F. unprepared people will be selling real estate, cars and other big ticket items for Gold. I know that this may sound opportunistic and cold, but we will see the largest transfer of wealth in our lifetimes occur in the next two years. Play the game the bankers and the elite are playing and you will come out ahead.

MizuBob said...

Thank You for the reply anon. It does makes sense that way.

Brian said...

I buy one oz increments. I keep thinking government will confiscate it this time by taxation.
It will certainly be harder for them to trace that way- not to mention if I need it to barter.

People are catching on. Government is corrupt, not us. I'm not going to turn anything over to them that I don't have to..


MizuBob said...

Thanks for the clarification, and thanks for keeping this blog.