Market Curiosity: Exploring Markets And Systems

February 25, 2011

How silver rumors like Wynter Benton can fit in with fundamentals like the monetary base

Filed under: Systems — Tags: , , , — Jeff Fitzmyers @ 9:34 am

Update: The Monetary Base info is getting it’s own post: Did a 140% rise in the Monetary Base lead to a 150% rise in silver?

… Blythe is handing out 30-50% premiums OVER spot to settle in cash…. Paging Blythe, we hear there are 19,500 silver contracts standing still, paging Blythe… 4500 contracts will not be settling in cash no matter what the premium is… (references: …“Wynter Benton” apparently encouraging hedge funds on how to easily make 20% every delivery month…)

I am not in a position to confirm, deny, or trade the info. But it’s in line with the crazy bullish silver situation: The longer a thing is suppressed, as long as the fundamental conditions are about the same, the more costly the suppression efforts will be until the dam breaks. Since above ground gold is 5 times more plentiful than above ground silver and silver has many more uses than gold, how long, at what cost, nay — what accelerating cost — can silver be kept from rising to par with gold??

If some rumors are true paper silver transitioning to physical silver costs up to $50/oz. If the fundamentals did not support the rumors, they would be laughed at.

Update: Apparently the 30-50% premiums were a rumor.
Feb 26: Apparently the rumor is being reiterated.

Earlier than that I posted that I was hearing that Blythe was handing out 30-50% premiums to roll over. Although the exact percentage has not yet been verified, I can guarantee its somewhere in that amount, and others like Harvey Organ will be able to verify my statement here as well.

Here is one big fundamental:

Since roughly September 24th 2008:
– Monetary base has risen 140%.
+ Silver has risen 145%.
+ Gold has risen 55%.

Fundamentally the fed (not federal, nor reserve) is busy as a bee printing and devaluing federal reserve notes that people pay to use. M2‘s The Monetary Base’s current rate of change is about 6.5%

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