Jim Willie interviews by SilverDoctors - Physical Gold Orders Clearing $230 over spot [Archive]

DMac

20th January 2012, 10:04 AM

Jim Willie: Large Physical Gold Orders Are Clearing at $230 OVER Paper Markets (http://silverdoctors.blogspot.com/2012/01/jim-willie-large-physical-gold-orders.html)

3 part interview

1:

http://www.youtube.com/watch?feature=player_embedded&v=sOjSZ8fES88

http://www.youtube.com/watch?feature=player_embedded&v=sOjSZ8fES88

2:

http://www.youtube.com/watch?feature=player_embedded&v=sc2o9nFU8Wc

http://www.youtube.com/watch?feature=player_embedded&v=sc2o9nFU8Wc

3:

http://www.youtube.com/watch?feature=player_embedded&v=e52FE-frqqE

http://www.youtube.com/watch?feature=player_embedded&v=e52FE-frqqE

Complete Interview Transcription here:

http://silverdoctors.blogspot.com/2012/01/jim-willie-large-physical-gold-orders.html

osoab

20th January 2012, 03:10 PM

Contrast what wille says to what kid dynamite had to say about premiums and Sprott.

Quote not taken in any order.

Paper and Physical Silver Prices Are Not Decoupling Yet (http://kiddynamitesworld.com/paper-and-physical-silver-prices-are-not-decoupling-yet/)

So let’s completely ignore the fact that Eric Sprott himself told you “we can buy silver, basically, at spot (http://kiddynamitesworld.com/eric-sprott-dispels-one-of-the-greatest-silver-myths/),” after all, that was last year – maybe things have changed? No – let’s go to the math. Remember yesterday’s post when I explained (http://kiddynamitesworld.com/sprott-physical-silver-trusts-premium-is-lower-than-you-think/) how you can approximate the new NAV of PSLV before it was posted on the website? Well, now that the website has updated data, we can do even better – we can calculate the price per ounce $PSLV (http://stocktwits.com/symbol/PSLV) paid for its silver.He runs the numbers.

My numbers come to $30.44, which, it should come as no surprise, is right in the range where silver was trading yesterday:

A little more on Sprott.

Sprott Physical Silver Trust’s Premium is Lower Than You Think (http://kiddynamitesworld.com/sprott-physical-silver-trusts-premium-is-lower-than-you-think/)

Eric Sprott is the King of the Silver Market. He is a master at work. Some people think that I have a “hard-on” for Sprott – on the contrary – the way in which he has played the silver fanatics like a fiddle to line his own pockets (http://kiddynamitesworld.com/eric-sprott-sells-the-balance-of-his-pslv-shares-for-his-for-profit-funds/) should be a case study in marketing for profit. What I do not tolerate is people drawing idiotic, blatantly false conclusions from data points like “PSLV is trading at a 30% premium to NAV, that must represent the real price of physical silver” – hint: it doesn’t.

Data Shows PSLV Over-Allotment Option Exercised (http://kiddynamitesworld.com/data-shows-pslv-over-allotment-option-exercised/)

Look at the shares outstanding, ounces held, and cash from yesterday and from today (which as you can see is really last night’s data) (just like we did yesterday (http://kiddynamitesworld.com/paper-and-physical-silver-prices-are-not-decoupling-yet/)), and you can see that the Shoe was exercised – the shares outstanding increased by the amount of the Shoe: 3.45 MM. We can repeat the process outlined in yesterday’s post and calculate the price that the 1,300,000 ounces of silver to back these new shares was purchased at. I come out with $30.70, implying that it was done yesterday.

Now, it sucks that the Trust had to pay more for the Shoe silver than for the Secondary silver, but if you work out the math, you’ll find that it was still accretive to NAV (by a sum total of TWO cents!) due to the fact that even when you include the underwriting fee, the shares were sold above NAV.