silver

This year some 900,000 oz of silver on average have moved into or out from these six warehouses on a daily basis.
The daily average movement of silver into and out from the COMEX silver warehouses at 900,000 oz is equal to 28% of total world daily mine production.” -Ted Butler

Over 1 in every 4 ounces of silver that planet earth will bring out of the ground this year, will be shuffled through the vast halls of Comex warehouses.  Over 1 in 4.  The Comex system has gone from moving perhaps 1 million ounces of silver per week, to moving nearly 1 million ounces…per day!  In fact, in just the last two business days, the Comex has moved over a whopping 4 million ounces of silver!
As prices continue their descent for both gold and silver, it’s more important than ever to keep a clear focus on the implications of this price action, not just for investors like us(which are obvious), but also for those trying to orchestrate it.  It’s all a game of ounces in the end, for these banks, after all.  They must bring enough physical metal to deliver on their exchanges, both to investors, and to the industrial users.  There’s no “Plan B”.
Since both sources of demand won’t back off from their record level purchases, the bullion banks realize that they simply have to bring even more product to market. Their backs are against the wall hereThe moment the metal is not delivered to some large customer in size, is the precise moment the end to this game will begin.  That’s the Catch 22 of the situation though: the banks want lower silver prices, yet the lower the price goes, the more threatened their constant source of supply becomes.
The banksters are Trapped Like Rats

empty-vault

While the Comex utilizes highly leveraged paper contracts to control the price of silver, physical metal continues to be drained out of the Shanghai Futures Exchange.  In just one week, total inventory has declined by another 24%.
At the beginning of August, there were 148 metric tons of silver on warrant at the Shanghai Futures Exchange.  In just three weeks, 29% of the total inventory was removed.
The majority of this decline took place last week when 22 metric tons were withdrawn on Friday alone.

broadside

The Unlooked for Juggernaut
As many commentators point to very significant signs that the imbalance in silver’s supply and demand are reaching critical points, very few of them seem to be paying attention to a forgotten metric to watch in silver.  

It is that metric which may be about to broadside the silver market again and break it open for good:

Shangahi Silver Stocks July 2014Chinese silver inventories are growing increasingly tight as stocks at the SFE continue to fall to record low levels. 
After the PAPER SMASH in the price of silver in April 2013, we can see just how fast inventories declined. 
By August, 2013, silver inventories at the Shanghai Futures Exchange fell 610 mt to 533…  a staggering 53% decline.  Inventories continued to fall, but a slower pace until they reached a low in November at 418 mt.
Then over the next three months, there was a build of silver stocks to a high of 575 mt in February, 2014.
Once the price of silver started correcting lower, inventories declined in March to 417 mt, and then a huge fall to 246 mt by the end of April.  In May and June, silver inventories remained relatively flat as spot price bottomed then headed higher in June.
When June rolled into July 2014, once gain, the price of silver headed lower right along with the decline in silver warehouse stocks..  Another 86 mt were withdrawn in July as inventories are now the lowest level (148 mt) they have ever been.
In a nutshell, silver inventories declined nearly 90% from their record peak set in March, 2013.  
The Shanghai Futures Exchanged experienced a net decline of 995 mt from March, 2013 to the end of July this year.

Shanghai Gold Exchange withdrawals 2014 week 23Chinese gold demand in the past few weeks is not as strong as in the beginning of 2014 or as in 2013 after the price of gold crashed in April, though the levels are slightly higher as they were throughout 2011 and 2012.
On the Shanghai Futures Exchange (SHFE) all silver futures contracts came out of backwardation this past week (week 24), and on June 13, most Shanghai silver premiums over international price closed under 6 %.
The prior week they all closed above 6 %.

The scarcity of silver in Shanghai appears to be easing.

SHFE silver backwardation june 6, 2014Silver remains scarce in Shanghai, premiums for spot silver this week have been above 6 percent over the international price and some contracts on the Shanghai Futures Exchange (SHFE) are still trading in backwardation.
On June 6, when the SHFE closed, the bid price for the first delivery month silver contract, which expires on June 16, was ¥ 4058 yuan. The ask price for the December contract was ¥ 4053 yuan.
This means that when you own physical silver, or can get your hands on any, you can sell it in June and at the same time buy it back in December for less money.
Silver delivered in June trades over a premium to silver delivered in December, which emphasizes spot demand.
Normally precious metals trade in contango; future prices being higher than spot.

SRS8The top 12 primary silver miners sold an additional 5.8 million oz of silver this quarter compared to Q1 2013 for a net loss of $78 million in revenue ($550 million – $472 million = $78 million)… whereas by-product revenue increased $105 million.
This resulted in the estimated break-even price for the top 12 primary silver miners of $19.78 or $4.27 lower than the average for full year 2013. 

Elephant hunting MorganIt’s no secret that demand for the U.S. Mint silver eagles coin has been unprecedented. It is a walk back through memory lane following the 1986 confirmation of the growing (exponential) popularity of the legal tender coin program.
Many are left these days scratching their heads about who is buying all these coins. Retail demand seems soft at best, with stable coin premiums relative to times of relative shortage.
Speculation has ranged from steady domestic demand to JP Morgan or some other large entity quietly or surreptitiously stockpiling silver eagles.
However, the real elephant in the room for silver demand may be the oldest form of silver – the demand for silver jewelry.

Global Conventional Investment Assets Updated 2013 EstimateThere is no need in trying to prove precious metals manipulation, because it’s out in the open… right in front of your eyes.  However, this doesn’t stop the silly games being played by some of the well-known analysts in the precious metal community.
It is the siphoning of the majority of the worlds fiat currency-funds into the Derivative-Paper Market that is guilty of manipulating the values of gold and silver.  If a fraction of these funds moved into physical assets such as gold and silver, their values would rise to unimaginable levels.
The world will be forced to move into Gold and Silver one way or another.
My advice is… you better get some before it’s too late.

Canadian Maple Leaf Sales Q1 2014With the release of the Royal Canadian Mint’s first quarter 2014 report, sales of silver maples increased substantially compared to the same period last year.  While Silver Eagles sales in Q1 declined slightly year-over-year due to a backup at the U.S. Mint, the Royal Canadian Mint reported a 24% increase in Silver Maple sales.
The Gold (and Silver) price manipulation will end one day OUT OF THE BLUE.  There will be no warningAnd of course it will be too late to purchase gold or silver.

Play

end badlyHarvey Organ joins the show this week for an EXPLOSIVE and MUST LISTEN Metals & Markets discussing: 

  • Massive US gold exports: NY Fed stealing sovereign nations gold- Harvey states ALL CUSTODIAL GOLD AT NY FED has now been shipped to China! 
  • GOFO Negative & silver backwardation with huge physical premiums in Shanghai- shortage looms
  • Death-blow to the dollar- Russia/China $400 B Gas deal a decade in the making is official
  • Eric Dubin explains how after years of rumors, COMEX default could come this summer!
  • Eric makes the case for a 50% upside move in silver coming in 6 months, while Harvey states that the cartel is nearly down to their last ounce of gold, & AN OVERNIGHT REVALUATION OF GOLD TO $4,000 WITH NO-BID SELLERS IS COMING IN 2014- PERHAPS AS EARLY AS JUNE!!

“The fun starts when the run on COMEX begins- $1.4 quadrillion in derivatives will burst in 2014 in a full-blown implosion! -H.O. 

The SD Metals & Markets With The Doc, Eric Dubin, & Guest Host Harvey Organ is below:

gold & silver sold outThe Doc joins Wall St. for Main St.’s Jason Burack for a wide reaching interview discussing current precious metals demand through the eyes of a retail bullion dealer, the current supply/demand situation for the ammunition and firearms market, and The Doc’s take on the overall macro-economic situation- how long do we have before a complete systemic collapse? 

The Doc’s full interview with Wall Street for Main Street is below:

U.S. Gold Exports Jan & Feb 2014As Russia, China and the other BRIC countries work towards a system that doesn’t include the TURD called the U.S. Dollar, Americans have less and less time to prepare for the GREATEST TRANSFER OF WEALTH…. in history.
Not only did the U.S. export 128 metric tons of gold in the first two months of the year, its supply deficit continues to increase. 
While gold exports to Hong Kong fell in February, Switzerland imported another 28 metric tons of gold during the month, more than twice the 12 metric tons it imported in January.
If we look at the chart below, we can see where the United States exported the majority of its gold.