Quote from Article By all accounts the price volatility in silver for the month of May 2011 was shocking. Silver went into a FREE FALL from near $50/oz to $35/oz in a matter of days. Clearly this is a market that is massively dysfunctional and an immediate remedy is needed if the regulators want to preserve what is left of the people's faith in free markets. The CME recently published their Monthly Metals Update for May in which they disclose the total volumes of futures and options traded for the month. That report can be found here: http://www.cmegroup.com/trading/metals/files/MoMU.pdf According to the CME the average daily volume of Silver futures and options in the month of May was 117,196 contracts and 13,786 contracts respectively or 655M ounces of paper silver traded per day. There were 22 trading days in the month which puts the total amount of paper silver traded on the COMEX in May at 14.4 BILLION ounces (14,408,020,000 to be exact). Wait just a minute! These are NOT legitimate trades in silver but rather SILVER DERIVATIVES that have lost all touch with their underlying physical asset. The market for silver futures and options is supposed to exist to help the silver market function smoothly for price discovery as well as to help participants manage risk. It is not designed to set the price of the underlying commodity which should solely be determined by specific supply and demand characteristics according to commodity law. Long article,vg chart. http://www.roadtoroota.com/public/630.cfm
Peter, Thanks for the article...sorry but no time to read now...however the thing that jumps out to me immediately is the volumes! (you put them in UPPER case? or what that's the article?) Anyway...WFT! Does this not WREAK of problems...or '14,408,020,000 to be exact' problems from one month of May? Simple - above = paper Silver This is why you hold physical...
the question is for all to understand what is manipulation. to effect the price to fall within a range or outside the pre-specified range are actions of manipulative market. to arrange the closing price at a specific price is manipulative. to make it move slowly in a baby step manner is manipulative. free market can be extreme, this is free market. let the market place decide. if some entity is trying to guide the price either up or down, we call it intervention, this is manipulation.
I think we all know what would happen if the precious metals markets, silver in particular, were free. The bottom line is the silver market is not a free market. its manipulated to its back teeth. Supply and demand doesn't work with paper. Its all f$%&ing rigged. Its a joke. And it makes me want out.
S&P 500 Futures Pit on May 6, 2010 (Flash Crash) and here comes JPMorgan http://www.youtube.com/watch?v=5gmpbsZ9H_w
Regarding this topic I can only advice to google some interviews with Ted Butler or watch such at youtube.
I'm new to silver and have been reading a lot and I keep hearing that silver prices have been held low for decades, but what I never read about is why? Can someone please explain what the purpose of this would be? Thanks.
