Thursday October 9, 2014

Table of Contents

All-Star Silver Panel Webinar

The Holter Report

Bill Holter

An Open Letter to the Mining Industry

October 9, 2014

 

Below is a letter I plan to send to each producing mining company and precious metals mutual fund that I own personally.  Gold and silver prices have been diluted by paper contracts to the point where no money can be made producing gold and an industry loss producing silver.  Years ago, Rob McEwen of Goldcorp decided to withhold the sale of gold production to be held in their treasury until prices were higher.  THIS is exactly what needs to be done now as a counterbalance to the unbacked paper contracts being sold to depress prices.  The COMEX and naked shorts need to be starved for metal, the strong demand is doing this slowly while the mining industry could do this very quickly.   

 

Please, copy and paste the below and sign with your name to any producing mining companies you have investments in.  Also, do the same for any gold mutual funds you may own and ask the money manager to contact their holdings with this same letter.  Government has an incentive to keep metals prices down and the lapdog regulators are allowing it to happen.  Price manipulation is illegal, if the authorities will not fix it, hopefully the industry itself has sense enough to finally do something!   

 

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Dear Sirs, I am a believer in hard money and an investor in both the metals themselves and various mining shares, your company being one of them.  As you well know, hard times have hit the producers of both gold and silver.  Gold and silver prices have been forced down, capital, either debt or equity is very scarce for our industry and share prices are back to the levels they traded at when gold was under $400 more than 10 years ago.  

 

Much evidence has been uncovered by GATA (Gold Anti Trust Action committee) over the last 15 years showing how gold and silver prices have been suppressed and continually manipulated yet we've heard not a sound from the industry itself.  Many mining concerns pay dues each year to the World Gold Council which at the very best seems to be an antagonist to gold and silver.  I know of no other industry which does not promote their own product nor protect it from outside and malicious pricing practices, this needs to change and the most logical catalyst is from within the mining industry itself.   

 

The industry as a whole is mining gold at best at a breakeven and silver at a very substantial loss.  It makes no sense at all to expend labor and capital to lose money, especially when your product is a finite resource and will not ever replenish.  If working harder and digging more ore was an answer then I would be cheerleading the machines, the fact is, the more that gets dug up in the current environment the more money is lost and precious ore wasted.   

 

The facts are well documented that global demand is and has outstripped supply of gold and silver for many years ...yet the prices are dropping.  Your "product" is being diluted by paper sales of "representative metal" while the board of directors do nothing at all.  Actually, the mining industry itself is aiding the suppression scheme by delivering metal.  Years ago Rob McEwen of Goldcorp withheld production from the market and held gold in their treasury for use at a later date and higher price.  Why doesn't the industry as a whole collectively do this?  Yes I know, fixed expenses must be paid but if mining ore is done at breakeven or a loss, why not stop mining ore?  Or at least only bring to market what is necessary to fund operations.   

 

Either discontinuing operations or withholding metal from the market on an industry wide scale will break the backs of the speculators for lack of deliverable metal.  This needs to be done industry wide but can only start one company at a time, why not our company?  Why do we deplete our ore and not receive fair value for our capital and labor?  Paper gold and silver contracts without any product behind them are "pricing" our product, the government is happy with this as it allows them to print freely and have lower interest rates than otherwise would be available.  The regulators have turned a blind eye, we have only ourselves to rely on and collectively depend on.   

 

Whether this proposed action is taken or not remains to be seen.  Shortages of metal will occur sooner or later as physical demand and backwardation will eventually take the metals higher in price by multiples.  Many companies will not be in existence within a couple of years unless those with the fiduciary responsibility to protect our companies and investments ...also protect our product from fraudulent dilution.  It is time to stand up and be counted now, later may be too late and will carry liability with it.  Best regards, _________.

 

Andy Hoffman's Daily Thoughts

Just $50 Million of Silver Left, That's It?

October 8, 2014

 

OK, I'll go on the record. I believe "it" has commenced - also known as "the big one," "Global Meltdown III," or the END GAME, take your pick. Not that it necessarily means the world will implode tomorrow; but soon - perhaps, very soon. Yes, TPTB will do everything in their power to defer this inevitability by utilizing whatever "bazookas" remain in their arsenal of money printing, market manipulation and propaganda. Of course, it is our strong view that the "propaganda leg" of this tripod is broken; as frankly, it's difficult to believe anyone truly believes any part of the world is or will shortly be "recovering."

 

As we wrote yesterday - before the market plunged - we believe "2008 Is Back With One Temporary Exception." That "exception" is PPT/Fed/ESF control over financial markets, which is decidedly waning as well; objectively, on the verge of being overrun in numerous segments. Global equities are plunging; and as "PPT operatives" can only control major indices, the vast majority of non-index included stocks are doing far worse. In the U.S., key indices like homebuilders are breaking down badly, whilst trading volume has surged and the trend toward speculating on risky companies has decidedly reversed. After a quarter century of observing markets, I know ugly warning signs when I see them, manipulation or not; and this is what they look like.

 

As the calendar turned from the low volume, highly manipulatable summer to the angst-ridden Fall, collapsing economies from "West to East," and a simultaneous "commodity crash" have catalyzed fear-driven flight to the liquidity of the dollar and Treasury bonds despite their utter worthlessness. Thus, our May 2014 prediction of the "most damning proof yet of QE failure" - i.e., plunging rates despite a so-called "recovery" - was soundly validated. As was our January 2013 view that the "final currency war" was underway, yielding intense Central bank competition to debase currencies. The resulting, wildly volatile currency movements are exactly what we described in last month's "single most bullish precious metals factor imaginable"; and as we espy the "ramifications" of this scorched earth monetary policy - including widespread global social unrest; it becomes clearer each day that the end game is not only inevitable - but perhaps, imminent.

 

Today is yet another Cartel "key attack event," in this afternoon's FOMC "minutes" publication. Consequently, the Fed desperately attempted another "New Hail Mary Trade," by goosing Treasury yields in the morning's wee hours. However, it has already reversed, and as I write at 11:00 AM EST, the 10-year yield sits at 2.34%, just three basis points from late August's 52-week low of 2.31% when the Fed "painted the tape" by goosing yields ahead of the September 18^th FOMC meeting. And thus, as the PPT, Fed, Cartel, MSM and every other "manipulation organization" prepares to spin last month's FOMC meeting - in which, absolutely "Nothing!" incrementally hawkish was said - as bullish for stocks and bonds and bearish for PMs, not only are U.S. Treasury yields near all-time lows but those of the entire world. Yeah, the "market" will believe the Fed intends to raise rates - amidst an abysmal global economy, plunging stock markets and a financial system poisoned with a cancerous, irreversible debt addiction. To that end, Yahoo! Finance's "top story" this morning is "FOMC minutes loom large for markets."

 

Which brings me to today's very important topic - of the "pink elephant" in the room we have long discussed. Which is the futures exchanges and ETFs set global gold and silver prices - particularly Western ones like the COMEX and LBMA, given that Easterners buy the vast majority of the world's physicalmetal. And more importantly, how can anyone believe such exchanges are legitimate when so little metal is purported to back them? And particularly so for the "financial world's Achilles Heel," silver; where no more than a two billion ounces exist above ground - the large majority of which are in vaults like Miles Franklin's at Brink's Montreal, never to see the light of day.

 

For example, the COMEX, where naked shorting algorithms yield trade volume at least 100x greater than the amount of metal supposedly settled; a measly 66 million ounces of silver, worth just $1.1 billion, is the entirety of the "registered" inventory available for purchase. There are 1,500 billionaires on the planet and hundreds of thousands of wealthy institutions capable of taking out this miniscule amount. And yet, it never seems to get bought. Heck, in April 2011, when the industry essentially "sold out" as silver prices soared toward $50/oz. - prompting the Cartel to execute the infamous "Sunday Night Paper Silver Massacre" - we're to believe the measly 26 million ounces of purported COMEX inventory wasn't taken out? Yeah right!

 

Next, we have the "London OTC" markets - which, as I learned on David Morgan's Masterminds call last week have a comical lack of transparency regarding the amount of metal actually delivered. According to David, who will be participating in Miles Franklin's "Silver All Star Panel Webinar" next Thursday, there is essentially zero data regarding London OTC inventories. And thus, in the city where the gold fix was recently dismantled due to rampant manipulation - in the words of the President of Germany's BaFin, the equivalent of the U.S. SEC and CFTC, "worse than LIBOR" - we're told to "take the word" of the world's leading financial criminals that metal exists. Then, of course, we have the SLV ETF administered by none other than the world's largest paper silver short, JP Morgan. Its inventory has never been - and never will be - audited, but we're to believe it somehow amassed 350 million ounces of silver, nearly 20% of the aforementioned incredibly illiquid global supply in just eight years' time. And better yet, in doing so, the price only increased from $11/oz. to $17/oz., when the cost of production is closer to $25/oz.? Yeah, if you say so.

 

But most damning of all is the paltry $50 million of silver inventory supporting the world's largest silver delivery mechanism, the Shanghai Futures Exchange. Actually that number was as low as $40 million last week, when a scant 80 tonnes of inventory were available for purchase compared to a slightly higher 95 tonnes today.

  

 

SRSRocco Report

 

According to SFE data, nearly 1,000 tonnes have been withdrawn since April 2013's "alternative currencies destruction" paper raids; depicting in crystal clear manner, an all-out panic for physical metal. This gibes perfectly with similar data as Indian silver demand - despite onerous tariffs - hit an all-time high in 2013; as did North American demand, given record high silver bullion sales at both the U.S. and Royal Canadian Mints. And FYI, as the paper price continues to be attacked on the COMEX, Indian demand is on pace to match 2013's record levels - as are silver sales levels at the U.S. and Royal Canadian Mints!

 

Equally amazing is that this is occurring simultaneous with last month's launch of the SFE's "International Board," enabling tens of billions of international investment into Shanghai's physical-only gold and silver contracts. How much more powerful of a statement of looming shortage - as we experienced in 2008, 2011 and 2013 - can be witnessed than the gaping difference between said tens of billions of potential investment and a measly $50 million of inventory?

 

In real markets, of course, the vultures would have long ago "smelled blood" and taken out the inventory - let alone, eagles like "Admiral Sprott" and Stefan Spicer through the PSLV and CEF closed-end funds. And thus, we have the sneaking suspicion that not only some, but most of the purported inventories are non-existent from the fraudulent COMEX, LBMA and SLV to the so-called "honest" SFE. Surely, some supply is available; but compared to explosive global demand, we find it hard to believe this meager declining supply will be able to "keep up" much longer. Thus, we strongly believe the days of "key attack time" raids like this morning's - at EXACTLY the 10:00 AM close of global physical PM markets, with interest rates near their lows and stocks plunging (except the Dow, which "coincidently" erased its losses ahead of the FOMC minutes publication) - are nearing their long-awaited permanent end.

  

 

 

And when this inevitability unfolds, if you haven't secured your share of the metal actually in existence - particularly silver - you may never get another chance. Or at the least, anywhere near the current Cartel-subsidized prices.

 

 

Interviews and Appearances

Monday, Wednesday It Doesn't Matter, It's All Manipulated

 

Andy Hoffman joins Kerry Lutz of the Financial Survival Network to discuss the stock market, unemployment report, attacks on precious metals, the housing market and the mining industry on verge of collapse.  To listen to the interview, please click below.  

 

 

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Has "It" Begun? 

October 8, 2014

 

On his weekly podcast, Andy Hoffman discusses the European Stock Market, plunging interest rates, the U.S dollar, the stock market, gold and silver.  To listen to the audio, please click below.

 

Download the audio file: Has "It" Begun?

Has "It" Begun?

Market Recap

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