NAV Premiums of Certain Precious Metal Trusts and Funds - Shenanigans /off

The premiums in the Sprott Funds remain tight, but certainly not as expansive as we had seen in the prior bull market leg in the precious metals.

It was nice to see gold rebound so sharply after the FOMC antics earlier this week. Silver is lagging a bit.

If and when the bull market returns in metals I would expect silver to outperform gold just on the basis of its greater volatility.

Last night I posted a few charts showing the extreme to which silver seems to have been driven. You may see them here.   Others have written more eloquently and repeated about the expanding open interest in Comex silver on declining prices that suggests a shorting campaign by the bears.

If this is in fact the case, then they might very well get stuffed rather handily should silver turn and break out.  But I suspect the ringleaders will have taken their gains by then and left some patsies holding the bag. 

The spread between price and NAV widened back out on the Central Gold Trust (GTU) after having narrowed with the announcement of the Sprott offer. Not quite sure exactly what to make of it, except that perhaps holds of the unitholders are not favorably viewing the offering which is intended to decrease the discount to NAV. I don't think it is a reversal of the arbitrage which we had seen narrow it down to around 4 percent.

Silver: Short Term, Longer Term, In Relation to Equities and Gold

“If you shut up truth and bury it under the ground, it will but grow, and gather to itself such explosive power that the day it bursts through it will blow up everything in its way.”

Émile Zola

Never buy something just because it has declined from a high.

If a principle is fundamentally sound and remains so, then there will be an inevitable reversion from any extreme high or low, back to a primary trend. 

Silver may present an outstanding opportunity. 

In the short term silver is coiling, and is deeply oversold relative to stocks.   It is even out of balance with gold.

But longer term it still remains in a bear market.

Timing and patience are everything.

Gold Daily And Silver Weekly Charts - Shenanigans, Confidence Games, and Bailouts

"If you dont own gold...there is no sensible reason other than you don't know history or you don't know the economics of it."

Ray Dalio

Gold was under early pressure this morning and was pushed lower to the 1176 level for no particular reason. It is in a trading range after all.

What was notable is that silver barely budged, holding stubbornly on to the 16 handle. Sometimes they do hang a lantern on their antics, and silver has an astonishingly large open interest already at The Bucket Shop.

And so as expected, the Fed really did nothing except to update their verbage and gold shot back up again into the capping range they have been maintaining this week.

I provide some thoughts on the Fed's motivations and probable actions here in today's stock market comments.

You may be surprised to hear that Wall Street is whining through their enablers and cronies about more subsidies and handouts. You can read about that here.

Gold is being capped by a Western gold pool that is seeking to prop up their awful policy errors and vainglorious ambitions in managing the world's reserve currency.   Like all pools that run contrary to the primary trend of the markets it will most likely fail.  Forecasting exactly when and how it will fail is a problem, as long as the cheat is profitable, and any consequences are distant and therefore easily ignored.  The forces of paper money are powerful.  That is why it is attractive to those who seek power.

I was saddened to hear that Jimmy Lee, Vice Chairman at JP Morgan, died unexpectedly today at age 62.   My most sincere condolences to his family in their sadness.   I am sure he was a loving father and husband, and he seems like he was a genial colleague.  I have heard him talk, and he was strong on the notion of working hard but 'putting family first.'

One can only wonder what Jimmy might tell us, if he were able to speak to us now.  But then it probably would not matter, because people full of the world 'will not listen even to Moses and the prophets.' Lk 16:31

Eternal rest grant unto him O Lord, and let perpetual light shine upon him.

Have a pleasant evening.