Thursday, April 14, 2011

Another stunning week in Silver

Last weekend we posted that Silver had broken through the $40 mark.

And as the metal climbed over $41, the Banking cartel struck HARD this week and attempted to completely crush the silver surge.

On Monday the confirmed volume of paper contracts dumped on the COMEX was an  earth shattering 132,213 contracts. Remember... each contract represents 5,000 ounces of silver.  Thus, in one day, the cartel sold 661,065,000 ounces of paper silver to the silver market!

On Tuesday the cartel attempted to smash silver again by flooding the COMEX with a totally monstrous 141,111 paper contracts.  In ounces this is 705 million oz or 100% of annual silver production.

Yesterday the confirmed volume was another huge 106,025 contracts.

As all of this paper silver was dumped on the market at the start of the week, the price of silver plummetted from around the $41.75 level to the mid $39.00 level.

But demand has been equally strong and silver keeps rebounding.

Then came some stunning news out of Bolivia today which has completely reversed the cartel's attempts to pound down silver.

Bolivian daily newspaper La-Razon reports that Bolivia's president Evo Morales is planning on expropriating zinc, silver and tin mines sold off by previous governments.

Bloomberg reports that "Morales will announce a decree May 1 to “dismantle the privatization model,” said Nicolas Fernandez, a spokesman for state mining company Corp. Minera de Bolivia, known as Comibol.

"The government is recovering all the privatized companies,” Fernandez said today in a telephone interview from La Paz. “When the decision is taken, Comibol will be ready to manage these mines.”

Among the contracts to be affected are those with Glencore International AG, Pan American Silver Corp., and most importantly, Coeur d’Alene Mines Corp., which is operator of the San Bartolome mine: the world's largest pure silver mine. Notably San

Bartolome and Sumitomo's San Cristobal account for about 83% of the nearly 1.1M tons of fine silver Bolivia produced in 2009.

Speculation is that if this privatization actually happens, the price of silver will spike significantly because 1.33 million kilograms of silver were produced in Bolivia 2009, according to the U.S. Geological Survey.

Production is expected to fall off a cliff in the utter chaos that will accrue from this unexpected nationalization.

As a result, Silver closed out the day soaring over $42 an ounce.

And when you consider what the banking cartel threw at the silver market this week, that's nothing short of astonishing.

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1 comment:

  1. Whoomp...there it is!Every day when i look at silver this my new silver song!Whoomp...there it is!Smile.