Modern Bank Run?

Comex Silver inventory Data

The rumors are plenty and have circulated for some time that Comex, the leading U.S. exchange for metals futures and options trading, may default in the face of demands for physical delivery of gold and especially silver. Now mix in with that the international exodus from the U.S. dollar and a new rumor that a foreign investor may be attempting to repeat the Hunt Brothers’ effort in the 1980’s to corner the market and you have a perfect storm brewing that could see silver reaching unheard of numbers in U.S. dollar valuation.

An interesting angle on the Russian investment in silver is the fact that it is far less likely that U.S. “authorities” would be able to do much about someone outside their jurisdiction attempting to corner any market.

I confess that I do not personally listen to a lot of the noise surrounding and attempting to affect  market fluctuations and I’m not sure it surprises anyone that these voices are getting louder as the price rises or that such voices are beginning to stimulate opposition that are growing as fervent in their bearish enthusiasm. A lot of people seem to be anxious to say “I told you so” one way or another.

What the savvy investor or barter-trader should want to recognize, I believe, is the improvement of their position when holding and using metals in whatever form that may be. For those who are privately trading for goods and services, your leverage grows as the market does. Regardless of what the market claims the value to be, as a friend of mine likes to say: ‘motion causes emotion‘. What I mean with that quote is that the promise of future increases in value can be a considerable tool when negotiating a trade. As a holder of real value, never degrade the advantage you have over the guy holding paper.

In the meantime, rest assured that the market “experts” will speculate day and night on where prices are headed. Your job is to survive and prosper and invest in future prosperity with any resources at your disposal. The value of your commodity remains the same, the value of paper does not. Whether the market goes up or down, you will always be able to trade and no one will be saying “I told you so”.

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