RSSCategory: Category: Physical Market

Bullion Banks Sell Even More Silver: Do They Have It?

Bullion Banks Sell Even More Silver: Do They Have It?

Anyone with a naked short in the silver futures market risks getting squeezed by physical buying. Demand for delivery of COMEX silver bars is rising, even as the paper price of the metal fell more than 4.5% last week. Silver shorts sold contracts representing a whole lot more silver than they have available to deliver again last week. The disconnect between paper prices and physical demand is getting more ridiculous by the day. It is also getting more dangerous for COMEX market participants – long and short. The COMEX functions on confidence, which can vanish suddenly. It will happen when long contract holders discover, en masse, the paper they bought […]

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Nervous Fed to Give Precious Metals Markets a Boost

Nervous Fed to Give Precious Metals Markets a Boost

The Fed’s Open Markets Committee met last week and left policy unchanged – at least for the moment. No one expected central banking officials to make rate adjustments last week with equity prices rubbing up against all-time highs and the economic recovery narrative still dominant. Central bankers are likely getting nervous, however. Treasury yields are surging, and it is only a matter of time before stimulus addicted markets throw another tantrum. In fact, the S&P 500 index fell after Wednesday’s announcement and each of the following two days. Rising yields are also creating headwinds for precious metals, at least in the futures markets. Prices are having trouble getting anything going […]

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Major Optimism for Platinum, Silver, and Copper

Major Optimism for Platinum, Silver, and Copper

Attention in the metals markets shifted this week from silver to copper and platinum. While big moves in silver and gold prices may be coming down the road, the monetary metals are currently taking a back seat to electrical and automotive metals. A massive push by the Biden administration to replace gasoline vehicles with electric vehicles is helping to crank up demand for copper. Anything involving electricity involves copper – and lots of it. Electric vehicles and their massive batteries contain an average of 180 pounds of the metal.  That’s six times the copper that’s used in gasoline cars. Even larger quantities of copper are required for EV charging stations […]

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Outlook 2021: Supply/Demand Fundamentals for Precious Metals

Outlook 2021: Supply/Demand Fundamentals for Precious Metals

The supply and demand fundamentals for precious metals markets got thrown into disarray this year, leading to heightened volatility – first on the downside, then on the upside. Although gold and silver will finish 2020 below their highs for the year, gold is still headed for an annual return of close to 25%; silver around 45%. Can hard assets investors look forward to further price appreciation in 2021? Yes, but…there are some near-term risks to the favorable long-term supply/demand outlook. Assuming economic conditions begin normalizing next year, we would expect demand – especially from industrial users – to increase. Mine production would likely rebound as well. The mining industry, like […]

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You May Have Overlooked These “Sleeper” Precious Metals

You May Have Overlooked These “Sleeper” Precious Metals

Precious metals markets got off to a rocky start this week as Wall Street celebrated promising developments on the vaccine front. On Monday, stocks surged while gold and silver sold off hard. That selling didn’t bring downside follow through, however. The metals held trading range support levels and pared some of their earlier losses heading into this Friday the 13th. A metal we don’t often talk about traded up to an amazing record high earlier this week. The noble metal rhodium made palladium look dirt cheap by comparison – commanding as much as $15,000 per ounce. Like platinum and palladium, the primary application for rhodium is catalytic converters for cars […]

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Coin Scammers Strike Again, Get Slammed with Unprecedented Government Lawsuit

Coin Scammers Strike Again, Get Slammed with Unprecedented Government Lawsuit

Bad actors within certain segments of the retail precious metals industry continue to prey on people who are looking to acquire gold and silver bullion. Regulators in 30 different states recently joined together with the Commodities Futures Trading Commission and filed an unprecedented federal lawsuit and enforcement action against a company accused of operating a large-scale precious metals fraud scheme. The company, Barrick Capital (a.k.a. Chase Metals, Metals.com), is accused of targeting mainly elderly customers through traditional and social media. Once they were identified as prospects for buying gold or silver, the victims were apparently subjected to aggressive sales tactics from boiler-room phone banks, pressured to liquidate stocks in their […]

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Gold Is Dangerously Under-owned by Americans, Especially Now

Gold Is Dangerously Under-owned by Americans, Especially Now

Far from being mired in the summer doldrums, precious metals markets appear to be on their way to making this summer one for investors to celebrate.  $20+ silver and new record highs for gold are both well within reach. Even as the big tech stocks that make up the Nasdaq are posting rip-roaring gains, the best performing sector of 2020 has actually been the gold miners.  The HUI gold mining stock index is up 30% year to date – and up over 90% since bottoming in March. Investors who bought just about any stock market sector near the climax of the panic selling have since been able to make big […]

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How the C-Factor Could Decimate 2020 Global Gold and Silver Production

How the C-Factor Could Decimate 2020 Global Gold and Silver Production

Item: March 16, 2020. A huge poly-metallic (gold, silver, copper) mining operation in Mongolia “has suspended operations” after authorities “restricted the movement of goods and people within the country.” Item: March 17. In Peru, one of the world’s largest primary silver-gold producers has its 4 mines “temporarily suspended” following the Government’s Declared State of Emergency. Item: March 18. A Canadian mining major suspends construction of a $4.7b copper mine upgrade in Chile affecting 15,000 workers. Item: March 20. Argentina declares a state of emergency and imposes “a nationwide mandatory quarantine starting today.” Silver and gold mines across the country move to halt operations, except for “a reduced workforce to ensure appropriate safety, security and […]

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Short Supply and High Gold/Silver Premiums, But There IS a Solution…

Short Supply and High Gold/Silver Premiums, But There IS a Solution…

A huge spike in demand for physical precious metals has decimated available dealer inventories. The vast majority of gold and silver coins, rounds, and bars are either out of stock or come with extended shipping delays. Premiums are spiking higher. Dealers have raised bid premiums – the amount offered above the spot metal price – dramatically along with ask premiums. The market is still searching for equilibrium and bids dealers pay may need to go even higher to entice enough sellers to meet demand. Demand continues to far outstrip available supply of minted items. The problem is being compounded as mints and refiners close in response to the COVID-19 virus. […]

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THIS Is What a Run on the Bank for Precious Metals Looks Like…

THIS Is What a Run on the Bank for Precious Metals Looks Like…

The explosive price action seen in palladium recently is indicative of a physical shortage. Put simply, available inventories are failing to keep up with demand (largely from the automotive industry). According to Refnitiv GFMS, the palladium market will be under-supplied by 883,000 ounces this year. Stresses on the physical market are showing up in spiking lease rates, illiquidity, widening bid/ask spreads, and disconnections between quoted spot prices and actual physical prices. Most importantly, the deficit in palladium supply is manifesting in the form of rising prices. Palladium hit a record, briefly touching the $2,500 level last month. And despite selling off a little in recent days, Bank of America Securities […]

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Why Palladium Is on a Tear

Why Palladium Is on a Tear

Physical palladium and rhodium markets are buzzing. Reported prices for both metals leapt higher in recent days. The story behind palladium’s move is that a physical shortage has developed in London. Traders sold metal they didn’t physically possess. Now they are being asked to deliver the bars and they are scrambling to secure the metal needed, bidding prices higher. It looks like bullion bankers selling paper metal are finally getting called for selling way more than they can actually deliver! People have complained about this practice in precious metals markets for decades. More and more contracts have been sold, but inventories of actual physical metal have not kept pace. Price discovery is […]

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Yes, China Is a Currency Manipulator – And the U.S. Banking System Is a Metals Manipulator

Yes, China Is a Currency Manipulator – And the U.S. Banking System Is a Metals Manipulator

The U.S. Treasury Department announced Monday that China is no longer on a list of countries deemed to be “currency manipulators.” The timing was awfully convenient, coming just ahead of an expected Phase One trade deal between the two powers. Nobody actually believes China has stopped manipulating the value of its yuan versus the U.S. dollar. But the Trump administration is apparently willing to accept a certain degree of currency rigging in exchange for other concessions on trade. It’s not as if the U.S. government has a stellar record when it comes to heeding principles of free and fair currency markets. It (through the Exchange Stabilization Fund and other vehicles) […]

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Bullion Banks Used Paper Gold and Silver to Restrain Price Advance in 2019

Bullion Banks Used Paper Gold and Silver to Restrain Price Advance in 2019

Gold and silver investors buy metals because they are scarce. Precious metals are by nature difficult to find, and hard to produce. Consequently, above ground stocks are limited and valuable, particularly when priced in unlimited fiat currencies. The bankers and government officials behind these fiat currency systems don’t like stable monetary benchmarks such as gold putting their inflation schemes on full display. They absolutely hate that gold works as a refuge. Inflation is a stealth tax. Instead of overtly raising taxes, politicians simply borrow and print the money needed for more government. They just need people not to notice. Which brings us to the futures markets for gold and silver. […]

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Weaponizing the Dollar; Gold Mining Stocks Chart Path to Breakout

Weaponizing the Dollar; Gold Mining Stocks Chart Path to Breakout

Federal Reserve Chairman Jerome Powell’s comments on inflation last Wednesday added fuel to the contra-dollar trade. During a press conference following the Fed’s decision to leave interest rates unchanged, Powell said, “In order to move rates up, I would want to see inflation that’s persistent and that’s significant. A significant move up in inflation that’s also persistent… “To move inflation expectations up from where they are, which appears to be a bit below 2%, will not happen overnight.” In other words, the Fed won’t be satisfied until consumer prices rise much higher over time. This “weak dollar” policy may come back to bite, though, as the Federal Reserve Note steadily […]

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