Erstmal guten Abend allerseits! Nach langem stillen Mitlesen möchte ich mich jetzt auch mal zu Wort melden.
Schon übel diese extreme Drückung, bin froh heute noch so einiges von Silber auf Gold umgeschichtet zu haben, trotzdem glaube ich aber immer noch an die Unterbewertung von Silber und bleibe long.
Hab heute einen interessanten Kommentar bei Turd Ferguson (tfmetalsreport.blogspot.com) gelesen den ich Euch nicht vorenthalten möchte, er ist lang und auf Englisch aber imho trotzdem wert zu lesen.
SilverSurfer said...
I have no expert opinion on what will happen if silver runs out of the Comex because I have not studied how it all works. That said, I've been around the block a couple of times and follow successful guys who predicted most of the calamaties in the past few years (i.e. stock bubble, housing crash, upcoming peak oil, etc) and will share some of what I've learned:
1. COMEX Default on Silver is not = to US $ collapseAside from Silver likely shooting up in price like a rocket, a Comex default on physical silver delivery will have no major economic impact. I see people on this blog preparing of the end of the world and some making the jump in logic that comex default = end of us dollar. If you really believe that, please explain yourselves step by step - IN DETAIL, I'd seriously like to read and learn, maybe I am not fully informed, but I don't see the connection. I am not saying don't research SHTF scenarios and don't prepare for very high inflation and even riots etc, but as I read recently, betting on the end of the world is a lost cause, because you will only be right once but unfortunately you won't even be around to enjoy life after it happens ;-)
2. US dollar will *NOT* hyperinflate in 2011 - Will the US dollar eventually crash and go to zero? Maybe, bu that's a BIG maybe, or at least not this year, and likely not even next year. I put that possibility at about 60% chance in the next 2 years. Why? Because no global ***RESERVE*** currency has ever experienced hyperinflation - EVER. Read your history. A hyperinflation of the US dollar would translate to the US dollar reserves of over 150 countries around the world going to $0 in a matter of a few months. China holds 2.7 Trillion worth - that's cause for WAR people. You think USA elites are stupid enough to provoke war with large countries around the world? One thing is to fight off guys on camels with tanks from 1970's another is to take on China and the Saudis. Now that doesn't mean that there couldn't be very high inflation (say 5 to 15% per month and beyond) due to continued QE + rise in oil. Hyperinflation by most economist's definition = 40% to 100% *per month*. We're currently experiencing REAL inflation between 7 and 15% *per year* (I'm not referring to CPI here that excludes food & energy). So will the dollar devalue another 15 to 40% in the next 2 years? Well devalue against WHAT exactly? All currencies are in a race to the bottom. So I say 15 to 40% against a basket of comodities and goods you buy at stores, in short against the average person's buying power - then I'd say yes.
3. US Dollar "collapse" is NOT the end of the US dollar. All kinds of websites talk about the "collapse" of the dollar, but if you listen to the expert economists that throw this word around but seem to often forget to define it. It's like 2 people talking about love, but never defining what they mean by it. Until you ask them to QUANTIFY by *how much* will it collapse, you won't really understand what they truly mean by that. Many people listening just assume it will go to zero, but that's hardly the case when expert economists refer to "collapse". I've heard figures anywhere from 20% to 60%, not 100%, at least not from any reputable economist. Also the problem I have with the word "collapse" is that it suggests that it is an EVENT. Yes there may be a day or a week where it goes down 10, maybe even 20%, but until that day, we will be "collapsing" very sloooooooooooooooooowly. Inflation my friends, as you have been witnessing for the past...well 40 years, is not an event, it is a process. Yes it can accelerate as we're seeing right now, but it's typically not an event in as far as reserve currencies go.
Got off topic there about silver & COMEX.
Back to the COMEX & Silver...
I view the COMEX as a place of exchange between 2 parties, neither of which is the COMEX itself. So the silver default will have counter parties. What happens to your paper contracts with those other parties depends entirely on who those parties are and how liquid they are. Best case scenario, they pay you cash 100 cents on the dollar for your contract - end of story. Worst case, they go bankrupt and then a court would decide who would get to claim $$ on their assets. Typically bond holders get the most of it at a fraction of its original value, and stock holders often get $0. Not sure how a court would decide on an options contract. If the counter parties are really large TBTF (too big to fail) like JP Morgan and HSBC, then either they pay up... btw, I don't see a mere $12 billion bankrupting JP Morgan. Firstl of all they make anywhere from 1 to 3.5 billion per QUARTER. So I imagine they have some savings or some of those billions invested in other areas that they could liquidate. See their 2009 Q1,2,3,4 profits:
http://money.cnn.com/2010/01/15/news/companies/..._earnings/index.htm
Worse case scenario, they are TBTF - aka. The Fed will bail them out and somehow you will probably still get scammed out of your money. Hey it's JP Morgan, they win 97% to 100% of the time. Don't believe me? Read this:
http://www.bloomberg.com/news/2011-02-15/...ree-quarters-of-2010.html
Further, HSBC, if that's the other counter party, is an international bank. I'm not sure if it is even possible to bankrupt them. Why? Because bankrupcy laws are different from country to country. Further, they also make about $5 to $13 billion per YEAR. So, again, likely they have cash reserves, and other investments they could liquidate.
http://www.telegraph.co.uk/finance/8291190/...24-billion-profits.html
Don't imagine for even 1 second that you can rally up the masses to buy 1oz silver coins and expect to crash entities like JP Morgan and HSBC. That's just plain naive. First of all 80% of the silver in the world is used for Commercial purposes. The BoS owns some 30%-50% of the rest of it, the ETFs own another 30-40%, and the rest might be physical coins and bars that you are buying. Further, the JP Morgans of the world (and they can be counted on 1 or 2 hands), only hire the brightest individuals from the best schools (i.e. Harvard) with fancy degrees and MBAs. Blythe Masters is one of those people. They are NOT stupid people. There's a reason their employees average $300K to $800K salaries per year - ON AVERAGE. FYI, a comodities broker these days goes for about $3 MILLION per year. JP Morgan had about 27 of them before they closed their prop desk and did an internal re-shuffle last year. I'm too tired to provide more links, just google this stuff if you want, it's all there.
Silver has plenty of reasons to go up in value without the need to bust COMEX's or bankrupt JP Morgans (I am long silver in a big way) although either/both events would be wonderful if they were to happen, but you are dealing here with extremely intelligent people who's combined IQs and economic degrees (enhanced by cocaine addictions) are even greater than the combined brain power and trading skill of the 74,000 turd visitors that showed up yesterday.
Appologies for the extremely long rant. Have a good night everyone, and thanks also for sharing what you know.
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