FunnyMoney
3rd October 2010, 11:30 PM
Here's a post lost to the destoyers of Internet knowledge.
The thread was started in 2007 and had some great responses. I did not save the responses which is very time consuming to do. But I did save the OP as I know how corrupt forums can become.
So please allow me to re-post now in 2010 an updated version of the original, and present it to GSUS for the reading pleasure of today's freedom forum members...
Silver: Just Another Walk in the Park
I challenge you to tell me what will prevent the following scenario from playing out...
I TOLD YOU SO
November 2012, Above ground stocks of mothballed silver stop selling into the marketplace - they mostly just run out.
Industry and investor demand remains strong despite some lingering global economic slowness, mostly caused by severe stagflation in the US. The Silver ETFs also stop any seasonal releases of silver, they recognize the lack of trust among some analysts and investors and don't want to appear to be doing anything but buying as the price of silver moves quietly but steadily upward.
Without large reserve selling, mining production and scrap recovery alone are unable to keep up with the demand for silver due to the fact that both investor interest and industry requirements return to consumption growth: a supply deficit which appears to be more, much more permanent than those of the past is finally created.
March 2013, Prices that have kept banging up against 40 for months now, all of a sudden climb rapidly into the 50s as investors focus on the now permanent silver deficit.
Some in industry begin to look for silver substitutes because of the deficit, and the rest look for ways to pass the higher raw materials cost onto consumers. They succeed in passing along some costs, but for many finding substitutes proves elusive.
Investor demand for silver delivery and silver ETF stock refuses to slow, despite occasional spikes down due to profit taking. But despite significant volatility which is normal for silver, the bounce backs are quite quick and on average prices continue to move up at about 3% per month.
THERE'S A WAY TO MAKE IT ALL OK
Mining takes on a "fast track" approach but large quantity finds are extremely ellusive.
2015, Industry demand is getting met by using an ever increasing lag in the delivery wait period for silver orders (silver on back-order). This works just barely in keeping industry fed (better late than never). A few industries which are unable to replace silver with alternatives and can't take the delays close up shop.
These select industry failures, and the widespread pass along costs for products and construction projects that rely on silver, along with large numbers of new mining operations drawing capital and using so much energy and resources begin to take a toll on worldwide economic growth. Global growth had been recovering in little fits and starts recently after years of what's been called "anemia" by the media but in reality has felt more like a depression. Due to the silver inflation as well as sudden bouts of severe inflation in selected sectors, the global economy stagnates and even begins to slide down again in certain areas.
Silver keeps within a lofty trading range for most of 2015 / 2016.
Still, for every month that passes the silver "on back order" delays get longer.
WE CAN PLAY NICELY TOGETHER, CAN'T WE?
Jan. 2017. Spiking prices for silver which have made a significant new high, and an uptick in volatility at the top sends many investors to the side-lines in worry since the theory is that it's more an industrial metal than a monetary one. Still, most longs stay bullish and net sells are a minority with silver, as gold continues to hit new highs and simply climbs and climbs in a methodical, almost boring fashion.
However, what's not boring is the general global inflation story which is now pushing all other stories to the sidelines. Finally, people realize just what it means when everybody's bills comes due but nobody has much wealth or reliable collateral to make payment.
Summer 2017, industry's silver consumption pains, however, are a different story altogether and their pain turns to utter frustration over the ever increasing delays in their silver shipments. They begin to significantly increase orders, as key sectors and competative companies decide to make an attempt to rapidly build stocks of silver; thinking this will prevent the growing delivery lags from impacting their businesses.
Most don't even notice the industry run for silver as there's plenty of inflation impacts occuring now. But long term silver investors, having never really taken their eyes off the ball, take notice of the surge in industry orders, and they too order more silver.
TOO BAD TO BE TRUE
2018, can price volatility know only one direction? It does now: silver prices march past the triple digit milestone without even looking back.
The massive silver shorts, having never unwound their prior positions, and still holding stacks of silver IOUs, only know one tune: they start it up again, shorting silver even more than ever before. Where do they get the money from? Massive liquidity comes from a variety of sources, ultimately loans are given and paper money is printed.
Only by these so-called "helpful" shorts, market's try to explain, are the ETFs and commodity option books able to satisfy the overwhelming long silver demand.
110, 120, 140, 180... they begin to look like posts on the side of the road, or more like it, the expressway.
Due to very long delivery delays, investors select the ETF and other virtual accounts as the preferred vehicle. Around the clock, the vaults of the ETFs take constant delivery of physical, but the questions remain: is it fast enough, how much is really in there, what is the percentage of short IOUs?
Goverments begin to take notice, wonder if there's a problem here, and ponder taking some kind of action.
DON'T WORRY, BE HAPPY, GOOBER TO THE RESCUE
September 2019, Investors in silver long option positions and in silver ETF stocks, trusting no one, but addicted to ever rising prices, ask for more delivery, for additional vault audits, and request to see exactly what collateral shorts really have backing the gigantic outstanding stack of silver IOUs.
At this same time, geological data regarding existing worldwide underground reserves is finally released to the public, after a multi-year study. It shows that even using only the world's industry consumption rate (no additional investor purchases and minus industry hoarding), the mining supply of silver will, for all intensive purposes, run out (no real significant mining production left available for anyone but the most critical industries) in around 10 years.
But the report says that if you factor in investor demand, the ETFs stocking as fast as they can, and some possible future unwinding of the massive short positions, silver will, uhm, ...well just suffice to say, we might as well be out right now.
Now that things have long since past the breaking point, goverments see the time as right to take action. Many countries, trying to protect vital industries, make it illegal to buy silver without a special "critical industry" permit, and encourage investors to sell into the marketplace with threats of potential confiscation.
Prices are fixed at the price of ???, in a more or less worldwide arrangement.
Most silver mining production, and scrap recovery operations are nationalized.
ETF and option trading in silver is abruptly halted pending regulator's decisions on what to do there; regulators describe the situation as "a real mess".
Industry is strongly encouraged by goverment laws and still high prices, to look for alternative metals, and methods that rely less on silver consumption. And over the years they see some success in that endeavor.
The squeeze upon investors with the new "just say no to silver" laws, allows for more years of goverment controlled silver markets.
Most investors holding acutual physical silver (you and me), facing a dead or "Gov't only" market, are forced to sell: the big boys get a premium price as the claim is made that their stocks are large enough to really help industry, whereas small scale selling (less than a million ounces) is priced much much lower, due to so called "handling charges" and new withholding taxes (sound familiar?).
SILVER DONE, TOWEL PLEASE
The day of reckoning finally comes, and silver mining hits a wall and begins to drop considerably, prices soar - at least on goverment ledgers.
The remaining mine production of silver and investor releases still continue to supply the industries that must use silver. Investment trading in silver is legal in only a few places, but a black market does still exist for silver and is growing. The period of hyperinflation and continued severe inflation has helped to make the blackmarket a powerful force in most every city.
Shorts are asked to unwind by regulators, but their front companies go bankrupt as there's no where they could possibly buy that much silver from anyway now, or ever. There had never been any significant collatoral.
Silver ETF stock and long option positions are revalued at a fraction of prior values. Nobody gets delivery and hasn't for a while but devalued checks are mailed to the paper holders. These checks quickly devalue even more while in the mail.
Investors holding physical through tried and true are now rewarded at top dollar, as long as they live in a country that did not enforce confiscation. They rake it in if they can sell it the black market way (some will get caught and go to jail), otherwise there's the tax man.
FOR A SILVER COIN TODAY, I'LL GLADLY PAY WITH DOLLARS NEXT LIFETIME
As for the shorts... Who they were, and how, and why, those few shorts, over the past many decades, were allowed to extract such huge wealth from the silver marketplace, on only the "promise" of ever returning it, is described as one of the greatest scams of the Century. A scam which will only be topped several decades later, when a similar "who, how, why" question is asked about the Century's worldwide paper money printing free-for-all.
The grandchildren of un-trusting investors who kept secret stocks of gold and silver hidden away, see the ideas of their fathers vindicated as finally a system which uses silver, platinum, gold, and copper coins is demanded for by inflation ravaged investors threatening to create their own private currency system, monetary policy, and even tax rules. It's based on some worldwide scientific standard (maybe a Metals Metric System?). Only after the hugest global Internet banks, ignoring all regulations and regulators, begin to buy mines and set up coin minting plants of their own, do goverments grudgingly adopt this new precious metals based monetary system.
The goverments of the globe continue to tax and tax, but at least now the hidden tax of paper money printing is history.
A "Gold Card" finally means something for real, when Master Card buys what's left in Fort Knox.
But the "Silver Card" is the most desired of all.
:whistle
:wwfg
The thread was started in 2007 and had some great responses. I did not save the responses which is very time consuming to do. But I did save the OP as I know how corrupt forums can become.
So please allow me to re-post now in 2010 an updated version of the original, and present it to GSUS for the reading pleasure of today's freedom forum members...
Silver: Just Another Walk in the Park
I challenge you to tell me what will prevent the following scenario from playing out...
I TOLD YOU SO
November 2012, Above ground stocks of mothballed silver stop selling into the marketplace - they mostly just run out.
Industry and investor demand remains strong despite some lingering global economic slowness, mostly caused by severe stagflation in the US. The Silver ETFs also stop any seasonal releases of silver, they recognize the lack of trust among some analysts and investors and don't want to appear to be doing anything but buying as the price of silver moves quietly but steadily upward.
Without large reserve selling, mining production and scrap recovery alone are unable to keep up with the demand for silver due to the fact that both investor interest and industry requirements return to consumption growth: a supply deficit which appears to be more, much more permanent than those of the past is finally created.
March 2013, Prices that have kept banging up against 40 for months now, all of a sudden climb rapidly into the 50s as investors focus on the now permanent silver deficit.
Some in industry begin to look for silver substitutes because of the deficit, and the rest look for ways to pass the higher raw materials cost onto consumers. They succeed in passing along some costs, but for many finding substitutes proves elusive.
Investor demand for silver delivery and silver ETF stock refuses to slow, despite occasional spikes down due to profit taking. But despite significant volatility which is normal for silver, the bounce backs are quite quick and on average prices continue to move up at about 3% per month.
THERE'S A WAY TO MAKE IT ALL OK
Mining takes on a "fast track" approach but large quantity finds are extremely ellusive.
2015, Industry demand is getting met by using an ever increasing lag in the delivery wait period for silver orders (silver on back-order). This works just barely in keeping industry fed (better late than never). A few industries which are unable to replace silver with alternatives and can't take the delays close up shop.
These select industry failures, and the widespread pass along costs for products and construction projects that rely on silver, along with large numbers of new mining operations drawing capital and using so much energy and resources begin to take a toll on worldwide economic growth. Global growth had been recovering in little fits and starts recently after years of what's been called "anemia" by the media but in reality has felt more like a depression. Due to the silver inflation as well as sudden bouts of severe inflation in selected sectors, the global economy stagnates and even begins to slide down again in certain areas.
Silver keeps within a lofty trading range for most of 2015 / 2016.
Still, for every month that passes the silver "on back order" delays get longer.
WE CAN PLAY NICELY TOGETHER, CAN'T WE?
Jan. 2017. Spiking prices for silver which have made a significant new high, and an uptick in volatility at the top sends many investors to the side-lines in worry since the theory is that it's more an industrial metal than a monetary one. Still, most longs stay bullish and net sells are a minority with silver, as gold continues to hit new highs and simply climbs and climbs in a methodical, almost boring fashion.
However, what's not boring is the general global inflation story which is now pushing all other stories to the sidelines. Finally, people realize just what it means when everybody's bills comes due but nobody has much wealth or reliable collateral to make payment.
Summer 2017, industry's silver consumption pains, however, are a different story altogether and their pain turns to utter frustration over the ever increasing delays in their silver shipments. They begin to significantly increase orders, as key sectors and competative companies decide to make an attempt to rapidly build stocks of silver; thinking this will prevent the growing delivery lags from impacting their businesses.
Most don't even notice the industry run for silver as there's plenty of inflation impacts occuring now. But long term silver investors, having never really taken their eyes off the ball, take notice of the surge in industry orders, and they too order more silver.
TOO BAD TO BE TRUE
2018, can price volatility know only one direction? It does now: silver prices march past the triple digit milestone without even looking back.
The massive silver shorts, having never unwound their prior positions, and still holding stacks of silver IOUs, only know one tune: they start it up again, shorting silver even more than ever before. Where do they get the money from? Massive liquidity comes from a variety of sources, ultimately loans are given and paper money is printed.
Only by these so-called "helpful" shorts, market's try to explain, are the ETFs and commodity option books able to satisfy the overwhelming long silver demand.
110, 120, 140, 180... they begin to look like posts on the side of the road, or more like it, the expressway.
Due to very long delivery delays, investors select the ETF and other virtual accounts as the preferred vehicle. Around the clock, the vaults of the ETFs take constant delivery of physical, but the questions remain: is it fast enough, how much is really in there, what is the percentage of short IOUs?
Goverments begin to take notice, wonder if there's a problem here, and ponder taking some kind of action.
DON'T WORRY, BE HAPPY, GOOBER TO THE RESCUE
September 2019, Investors in silver long option positions and in silver ETF stocks, trusting no one, but addicted to ever rising prices, ask for more delivery, for additional vault audits, and request to see exactly what collateral shorts really have backing the gigantic outstanding stack of silver IOUs.
At this same time, geological data regarding existing worldwide underground reserves is finally released to the public, after a multi-year study. It shows that even using only the world's industry consumption rate (no additional investor purchases and minus industry hoarding), the mining supply of silver will, for all intensive purposes, run out (no real significant mining production left available for anyone but the most critical industries) in around 10 years.
But the report says that if you factor in investor demand, the ETFs stocking as fast as they can, and some possible future unwinding of the massive short positions, silver will, uhm, ...well just suffice to say, we might as well be out right now.
Now that things have long since past the breaking point, goverments see the time as right to take action. Many countries, trying to protect vital industries, make it illegal to buy silver without a special "critical industry" permit, and encourage investors to sell into the marketplace with threats of potential confiscation.
Prices are fixed at the price of ???, in a more or less worldwide arrangement.
Most silver mining production, and scrap recovery operations are nationalized.
ETF and option trading in silver is abruptly halted pending regulator's decisions on what to do there; regulators describe the situation as "a real mess".
Industry is strongly encouraged by goverment laws and still high prices, to look for alternative metals, and methods that rely less on silver consumption. And over the years they see some success in that endeavor.
The squeeze upon investors with the new "just say no to silver" laws, allows for more years of goverment controlled silver markets.
Most investors holding acutual physical silver (you and me), facing a dead or "Gov't only" market, are forced to sell: the big boys get a premium price as the claim is made that their stocks are large enough to really help industry, whereas small scale selling (less than a million ounces) is priced much much lower, due to so called "handling charges" and new withholding taxes (sound familiar?).
SILVER DONE, TOWEL PLEASE
The day of reckoning finally comes, and silver mining hits a wall and begins to drop considerably, prices soar - at least on goverment ledgers.
The remaining mine production of silver and investor releases still continue to supply the industries that must use silver. Investment trading in silver is legal in only a few places, but a black market does still exist for silver and is growing. The period of hyperinflation and continued severe inflation has helped to make the blackmarket a powerful force in most every city.
Shorts are asked to unwind by regulators, but their front companies go bankrupt as there's no where they could possibly buy that much silver from anyway now, or ever. There had never been any significant collatoral.
Silver ETF stock and long option positions are revalued at a fraction of prior values. Nobody gets delivery and hasn't for a while but devalued checks are mailed to the paper holders. These checks quickly devalue even more while in the mail.
Investors holding physical through tried and true are now rewarded at top dollar, as long as they live in a country that did not enforce confiscation. They rake it in if they can sell it the black market way (some will get caught and go to jail), otherwise there's the tax man.
FOR A SILVER COIN TODAY, I'LL GLADLY PAY WITH DOLLARS NEXT LIFETIME
As for the shorts... Who they were, and how, and why, those few shorts, over the past many decades, were allowed to extract such huge wealth from the silver marketplace, on only the "promise" of ever returning it, is described as one of the greatest scams of the Century. A scam which will only be topped several decades later, when a similar "who, how, why" question is asked about the Century's worldwide paper money printing free-for-all.
The grandchildren of un-trusting investors who kept secret stocks of gold and silver hidden away, see the ideas of their fathers vindicated as finally a system which uses silver, platinum, gold, and copper coins is demanded for by inflation ravaged investors threatening to create their own private currency system, monetary policy, and even tax rules. It's based on some worldwide scientific standard (maybe a Metals Metric System?). Only after the hugest global Internet banks, ignoring all regulations and regulators, begin to buy mines and set up coin minting plants of their own, do goverments grudgingly adopt this new precious metals based monetary system.
The goverments of the globe continue to tax and tax, but at least now the hidden tax of paper money printing is history.
A "Gold Card" finally means something for real, when Master Card buys what's left in Fort Knox.
But the "Silver Card" is the most desired of all.
:whistle
:wwfg