1 November 2008

Calvin on silver

I regularly say here that due to my holding active positions that I regard as vulnerable to other people cottoning onto the same or similar ideas I often do not say precisely what I am doing, but have to say things with often quite extreme elasticity of the English language.

I have said in the past that I regarded the physical prices of bullion - especially of silver as artificial and related to the Comex paper market and currency speculations.

I am now able to spell out more detail as I have finalised some positions sufficiently to not feel so vulnerable.

Today I'd like to be candid and explicit about my views on the current market. My own views are markedly different from all those banging the gong about the so-called crisis and the never-ending pushing down of market prices across all sectors. I'd personally further opine that those living and trading inside the USA are bound to have a stilted and incorrect vision of what is going on.

The 'crisis' is related to the deterioration of the Basel Committee Capital Accord for all participating banks over the last ten or more years.

This deterioration was initiated quite deliberately from US sources and with the complete and total comprehension and involvement of the US Federal Reserve.

You will not have read this viewpoint expressed in this way anywhere, ever before. It is however, utterly true without a single even small variation. Further, I can tell you as a matter of personal and certain private knowledge that it is by no means whatsoever anyone from the Rothschilds who are now or have ever been behind this type of insanity. This was expressly and completely a creation of people long held as puppets of such major banking clans (and who are absolutely NOT puppets nor associated) and who have held the White House captive to their false ideologies. George Soros is totally correct in his assessments.

There IS both a shortage of physical gold and physical silver. This is not being reflected in the bullion prices because of Basel II's consequence of permitting banks to hold no capital reserves of a testable liquid kind and the automatic resorting to government Treasuries to source payment mediums. All that is happening is an assertion in the real marketplace of Gresham's Law. Real gold and silver is being hoarded somewhere and NOT re-sold or circulated across the exchanges. Derivatives in precious metals are many times what derivatives in equities are.

Technology has moved past the Federal Reserve and the note making capacity if presentday governments.

In the back streets of China and Hong Kong today are micro-chip based forms of currency in circulation that have never before been seen anywhere. You have not seen it. No one from the Wall Street Journal has seen it.

...Which just goes to show you how far behind the curve the present popular mindset really is.

There is a deflation of certain asset sectors and almost everything tied to the US financial economy. But it's all about weak holders as opposed to strong holders.

It may yet be possible for Fox and CNN to 'inform' everyone that EVERYTHING is being deflated - and hey, they might even get away with convincing people that it is true...

However you cannot buy rare things today cheaper than you could have yesterday and you never ever will.

At the risk of ruining my own prices - although as I have said, my first line of profit has already been achieved - I can say that it simply has not been the case to date that any segment of the rare coin market has reversed in demand, clearance rate or price. There is a further reason why collector SILVER coins - even moderately collectable silver coin - will go up even further compared with all other types of collector coin with the possible exception of the extremely rare bronze lines. I shall not go into this reason now.

Personally, I have been shorting bullion (and now buying it back) whilst accumulating rare silver collectors coins...

To some effect, I must say.

Of course, this will hardly rival uncle George's ability with the Pound Stirling - however each quarter million sale of a tiny silver collector's piece goes a long way to footing the deposit on a healthy leveraged contract.

And for those with a far more modest appetite yet, Christmas is soon to be on us and your old Gran's plum duff silver pieces are showing a gain of some percentage akin to the inflation rate in Zimbabwe. Considering that what was available from the Perth Mint ten years ago for twenty dollars now goes for $100 - $200.

I wouldn't be sniffing at lowered prices offered by the ill-informed for old pre-Sixties silver content coinage. I'd be buying it all as much as you can get your hands on.

IF... ...you can get any at lowered prices. Frankly, I don't see the evidence of this famous deflation (which, mind you, is absolutely in the real estate market) in the silver coin market at all. And for good reason.

Calvin J. Bear

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