by Jason Hommel, April 6th, 2009
In the past, I've pointed out various frauds in the silver market such as, the excessive futures contracts on the COMEX, the excessive trading in "London" silver, and the excess silver in the new ishares Silver ETF, SLV.
In 10 years of reading and writing and searching, I've never known the numbers of paper silver in the OTC "Over the Counter" market until a reader informed me, just today.
This is directly from the BIS, the Bank of International Settlements. This is good data.
http://www.bis.org/statistics/derstats.htm
At the link above, see
21 Amounts outstanding of OTC single-currency interest rate derivatives
"21C By instrument, maturity and counterparty"
That's this link:
http://www.bis.org/statistics/otcder/dt21c22a.pdf
See the center middle column towards the bottom, under "Other Precious Metals", which excludes Gold. This would be Silver, Platinum, and Palladium. We can exclude Platinum and Palladium as nearly irrelevant, because those markets are much smaller than silver, and very few people hold paper instruments of that type. Furthermore palladium is much like silver in that the market is dominated by industrial demand, and investor demand is less than 5% of the market.
The number of "Single currency interest rate derivatives in other precious metals (SILVER)" from June 2006 to June 2008, in two short years, more than doubled:
From $84 billion to $190 billion!
That's about 40 times larger of a fraud than I had thought.
This is serious news. This is original reporting. Will any other news agency cover it? Probably not.
How much new paper silver is that?
Well, the physical silver investor market annual demand is about $1.3 -$2 billion per year! And yet, they sold $100 billion in new paper silver in the span of 2 years, which is over 50 times as much paper silver as exists in the world annual physical silver investment market!
Previously, I had written and exposed that one or two banks sold, over the span of about a month, 130 million ounces of silver at COMEX to depress silver prices, which is only 1.3 times as much as annual investor demand.
I'm shocked at the figures. Most people who are thinking that they are "buying silver" are still just trusting banks and brokerage firms that have no silver.
Real silver investment demand has therefore not yet really begun, because those banks have not bought any silver. Just wait. It's going to get absolutely crazy.
I just watched a History Channel show last night on the Madoff Scandal. This is nearly 4 times as big! It's the same kind of Ponzi scheme, as they have not bought the real silver that they owe their clients.
People kept saying that the Madoff Scandal was the biggest Ponzi scheme in history. It wasn't. The biggest is not even this silver scandal. It's paper money; that's also a Ponzi Scheme!
I know many people who have most of their wealth with the brokerage houses, and just "some" of their assets "in silver" with the same firms. It's time to pull 100% of your assets out of those firms. Put most of it, if not all of it, into silver first, palladium second, and gold third. Let the diverse metals be your diversification.
Spread it around in several locations if you have a lot. Buy the vaults you need to protect it.
Buy it now, when the silver market is relatively calm, when silver is available.
We offer about $78,000 worth of physical silver at auctions nightly at seekbullion.com. And it's available for immediate delivery, unlike many of our competitors who offer silver for delayed delivery.
It won't be enough.
Also, we won't be ordering or making any more of the following items, so when we sell out, those will be the last ones available:
New Obama, Old Obama, Fish, Bull, CFTC, Snake.
We will continue to re-order all of the replicas such as the Buffalo and the '29 Indian, and our other designs such as the Beer, NWO, "Love God" and the Pirates (except Obama).
At our Coin Shop in Rocklin, and online at seekbullion.com, we will be offering rounds and bars at $1.75 over spot again. Our suppliers have been good to us, and have lowered costs once again for us due to our large volume.
Sincerely,
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