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Dear Reader,
If you've been paying attention to my Gold & Silver Daily newsletter, you know there's a lot going on in the silver market right now:
- Da Boyz have accumulated gargantuan and grotesque short positions in the silver market – that will need to be covered before long. The "4 or less" bullion banks require 124 days of world production to cover all their short positions in silver... And the "8 or less" bullion banks require 162 days of world silver production to cover their entire silver short position. (See Ted Butler’s chart over at sharelynx.com in my report linked here. When they have to start covering these short positions en masse, the paper sellers on the Comex [and physical supply] will disappear and prices will melt up.
- Finally! The mainstream media are waking up to the issue, with the Wall Street Journal now covering this story. In a recent article titled, "Act Now, CFTC Is Urged," CFTC Commissioner Bart Chilton said market players have made "repeated" and "fraudulent efforts to deviously control" silver prices. The article went on to explain that the CFTC is facing pressure from all sides to crack down on fraudulent trading in the silver futures market. New CFTC regulations expected soon would literally force Da Boyz to cover their short positions, and will give them a limited time to buy up the silver to do so (at whatever market prices result from their buying frenzy).
- Not only that, JPMorgan and HSBC are now the target of several lawsuits alleging illegal trading activities in the silver futures market – which may result in them having to cover their short orders even quicker. This story has been picked up by Forbes, Reuters, Bloomberg, Dow Jones Newswires, and others – and echoes what silver analyst Ted Butler has been saying for decades. A view I whole-heartedly agree with... and have been telling you about for over three years in my daily newsletter.
- Covering short positions isn't the only reason for buying bullion right now, either. The Sprott Physical Silver Trust IPO was expected to raise $500 million primarily to buy silver bullion. It's rumored they'll be buying up 15 million ounces of bullion within days of the IPO – and we've already started seeing market action that appears to be ripples from their buying activity. And Sprott is just one of many who are buying up bullion to give investors alternative ways to invest in silver – diminishing supplies and driving up prices as a result.
- And frankly, I think we're nearing market mania. While I believe that lawsuits, position limits, and coverage in the WSJ could do a lot to clean up the Wild West silver market, the increased coverage will also bring opportunity seekers and others looking to make a quick buck off the latest hot investing tip. This has played at least some part in silver's meteoric rise to $27 – though I'm sure it's far from over. Before we're done, the Wall Street pundits on Fox Business will be shouting to buy silver – while you'll already be sitting on substantial profits from going "all in" now.
Combine these factors with increasing demand for silver as real currency while Bernanke and the Fed authorize themselves to fire up the printing presses for QE2 (this hyperinflation trigger amounts to a "license to steal" the worth of your dollars right out from under your nose – which boosts the price of gold and silver).
And these are only part of the story. In fact, over the last several weeks I've been working on a must-read special report for you about the silver market, why higher prices are coming soon, my conservative estimate for how high I think it could go in the next few months, and where to turn for advice on how to play your cards for maximum profit off silver's big moves.
I've been telling you I've gone "all in" for a big move up in silver. And I've been encouraging you to do the same.
Now here's the full story of why, and like I said, it's a must-read... the link is here.
See you soon.
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Ed Steer
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