Most of our readers are aware of the ongoing debate on whether a return to the gold standard would fix the massive debt problem plaguing the Western financial system.  Sound money advocates led by Ron Paul have long called for a return to the gold standard rather than the paper fiat debt currency currently issued by the Federal Reserve.
The gold standard debate has even recently reached the mainstream, with the Republican party even making it a portion of their party platform to study the feasibility of such a return to sound money.

In this excellent and MUST READ piece, Martin Sibileau presents a technical perspective on why a return to the gold standard alone is NOT ENOUGH to solve our current economic crisis, stating that it must be accompanied by the extinction of the shadow banking system.


*Update: Silver has now retraced nearly the entire waterfall decline, as it has traded back to $34!

After consolidating over $34 throughout the morning COMEX session, the cartel has just initiated another waterfall decline in silver, as the metal was just sent from $34.05 to $33.44 in seconds.

SPOT MARKET prices for buying gold eased to just above $1770 an ounce during Tuesday morning London trading, around ten Dollars below where they started the week, while stocks and commodities were broadly flat despite major economies seeing their growth forecasts downgraded by the International Monetary Fund.  Prices to buy silver dropped below $34 an ounce – down more than 2% on the week so far.
US Treasury bond prices gained this morning, in contrast with those for UK and German government debt, which fell along with the Euro.

Submitted by SD Contributor FW:

Since early September, will all the huffing and puffing the cartel has directed towards silver, they’ve accomplished virtually nothing other than scaring the bejesus out of all but the most informed strong hand silver investors.  All the cartel has been able to do is push silver under $34 for a few hours per raid per week.  That’s pretty much unprecedented, yet sentiment remains so despondent that few seem to even notice that the cartel is actually already showing the weakness one would expect to see at the initial stage of a commercial signal failure.

The cartel has been attacking like mad for the better part of a whole month now, ripping out not only the kitchen sink but taking much of the rest of the plumbing out of the walls and hurling it at the paper markets.  Yet even through one of the fastest additions of short interest we’ve seen throughout this entire bull market, the cartel has little to show for it’s effort.

I believe we have been witnessing the initial stage of an evolving commercial signal failure.

Bloomberg & it’s BNY Mellon guest are bullish on gold and silver, stating that gold will punch up through the critical $1800 level, and that silver will clear $35 and target $37.5-$40 by the end of Q4.
Does this call by the financial MSM warrant caution for precious metals investors over the short term- particularly with commercial net short positions in gold and silver near record highs, or do they just recognize the early stages of a commercial signal failure, as pointed out by FW?

CNN Money’s HelpDesk blog today published a Q&A responding to an inquiry regarding the question How do I purchase silver in physical form?

CNN Money’s response? ETF’s such as  SLV or SIVR (notice Sprott’s PSLV is not included), silver certificates- essentially own paper silver in any way or form as long as investors avoid actual physical silver bullion like the plague.

By Jim Willie,

The recent decision by the US Federal Reserve to contaminate the financial body until it responds favorably was the last straw in my book. Witness a declaration of permanent QE and hyper monetary inflation of the most virulent strain, unsterilized. The USFed is essentially admitting failure. The signal serves as the loudest death knell for the USDollar among many in a sequence.  The QE bond monetization of USGovt debt has turned viral and entrenched. It is sold as stimulus, when in fact it acts like a giant wet blanket on the USEconomy. It is intended as stimulus to businesses, but the effect is felt on the financial speculation and on Asian direct business investment. In the past the emergency lever device had been successful only because it was used on a temporary basis. But now the USFed high priest assures it is a permanent fixture, a sign of their failure.

The money is not finding its way into the USEconomy for further circulation. The plague is insolvency, soaked by endless applications of tainted money from central bank fire hoses.


Gold market instability could be a tremor before a burst upward. The same appears true for the silver market. On a single day last week, JPMorgan dumped two years worth of US silver mine output in the form of paper silver supply on the COMEX market. The corruption went largely unnoticed. They defend the important $36 level.
A powerful USDollar decline is imminent.

Submitted by SD Contributor Marshall Swing:

Gold COT Report 10/5/12

Commercials sold off -8,256 longs and covered 1,341 shorts to end the week with 56.33% of all open interest, virtually no real change from the previous week in total open interest, and now stand as a group at 26,927,000 ounces net short, an increase of 691,500 ounces net short from the previous week. 

On this semi-holiday with volume extremely low, silver is struggling to regain the $34 level after the cartel’s vicious raid on the overnight Asian session smashed price below $33.70.

After consolidating between $33.80 and $33.90 throughout the rest of the overnight Asian and London sessions, silver has finally regained the $34 level early in COMEX trading, and is rallying back towards $34.30.
Gold has also just regained the critical $1775 level.
With volume light and commercial net short positions near all-time highs in both silver and gold, it would not surprise us to see another raid attempt after the pit close during the afternoon access market trading.

Forget fiscal stimulus or even quantitative easing, imagine the ‘boom’ to the economy if it is suddenly illegal to sell used products?
The Supreme Court will rule this fall on whether it is legal to resell any product without the consent of the original copyright holder.
Welcome to the totalitarian, socialistic state known as the USSA.

It could become “illegal” to resell your iPhone 4, car or family antiques

*Updated: 2nd wave of attack in progress, silver smashed under $33.70
Friday’s desperate attempts by the cartel to prevent a weekly close about $35 in silver and $1800 in gold were well documented on SD (and even Kitco’s weak attempt to erase the evidence of the massive raid).
This week’s silver COT report revealed that the cartel piled on another 31 million ounces to their net shorts, bringing the commercial net short position in silver to a mind-blowing 289 million ounces.

Thus, it should be no surprise to SD readers that the cartel has just initiated another water-fall decline smash in silver.