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. http://www.gata.org/node/12011

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. http://www.silverstandard.com/

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. 

Odd. 

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.