Gold and Silver Paper Shorting Collusion?

Gold and Silver Paper Shorting Collusion?


(Text on Screen): with guest David Morgan.
Elli$Martin. The Report. TSX-VELS. El Tigre Silver Corp. Ellis Martin: The following segment is sponsored
by El Tigre Silver Corp., trading on the TSX Venture Exchange under the symbol ELS.V and
on the OTCQX as EGRTF. El Tigre Silver Corp. is focused on silver exploration and development
in prolific Sonora State, Mexico. Find them on the web at ElTigreSilverCorp.com. Join me for a conversation with a frequent
guest of the show, David Morgan, the Silver Guru, an expert on money, metals, and mining,
also, a lecturer and an author. Mr. Morgan has written Get the Skinny On Silver Investing,
available on Amazon.com. His website is TheMorganReport.com. David,
welcome back to the program. David Morgan: Ellis, it’s great to be with
you. Ellis Martin: Even though I follow your work
closely and I know you’re involved in the futures market with regard to silver, you
did a recent interview saying that there aren’t any limits on shorting. You said you can really
sell as much as you want, but according to Gene Arensberg, who I’ve interviewed, of the
Got Gold Report, well he’s saying that’s not really true, David. What’s the deal? David Morgan: Yeah, well thanks for again
holding my feet to the fire Ellis. You’ve done that in a couple of instances. One not
long ago is when I said the Chinese word for silver and we kind of got that straightened
out on your show and here again we have something to discuss on am I right or am I wrong. Basically, what Gene says is correct. If you
go to his article, that I put out on our Twitter feed, so much for position limits on COMEX
gold and what Gene points out in his articles it that there are limits that are applicable
and in gold there are 3,000 contracts in the front month, and 6,000 contracts in all months. And the article goes on to say that the recent
smashing that took place in both the gold and silver markets was 40,000 contracts. So
what that would mean is that there were 14 traders, if they were all at exact limit and
that would be collusion. You’d have to get 14 or more all saying: “OK we’re selling limit
amount that we’re allowed to hold,” which, of course, would show collusion and this is
his article and I agree with that. Or, that basically it might have been one,
two, three, four traders, probably more likely three or four, or it might have been just
one, we don’t know yet and the CME group and the CFTC is just turning a blind eye. So, when I made my statement that you can
sell as much as you want of what doesn’t exist in the gold and silver markets but try taking
delivery where there’s also a limit, then it only applies to one-way trade. If you try
to take physical delivery, oh they’ll uphold that part of the limit: “Oh no, you can’t
have more than the limit,” but when it comes to the sell limit they ignore it. So, I was saying it from a purely realistic
perspective, meaning that, yeah, these laws that are on the books are ignored and have
been ignored for a very, very long time. And this took place more than once. It took place
in the silver market during this gold smash and before that, one that comes to mind, is
one that took place around May 1 of 2011 after there were five margin increases in the silver
market and there was a massive amount of selling on paper that drove the price down significantly. So, again, I’m looking at it from what the
real situation is; in other words, if the real world event is, is it outside the purview
of what the legal limit is on paper? Yeah, it is. But from the realistic perspective
of what takes place, when these smashings take place, it’s ignored and this, of course,
should infuriate people. And there’s been a couple of articles on this
Ted Butler talked about where is the CFTC when you need them and Gene’s article and
there’s been a few more that basically are trying to bring attention to the regulating
bodies that are supposed to be doing something and they’re doing absolutely nothing. Ellis Martin: Why do you think that is? Why
are they looking the other way right now or not looking at all? David Morgan: I think the reason being, and
this is opinion, is that the financial markets have become so corrupt that the government
itself and the regulators underlying these government entities, are basically being pushed
around by money, by the power brokers of Wall Street, if you will. I think the CFTC’s hands
are basically tied. I think there’s some collusion in between
the bankers and these regulators; that’s a possibility. I don’t know that for a fact.
But regardless the obvious needs to be stated: that the regulations are being upheld and
you can guess your own reason why. I think it’s money. I thinks it’s, one, the CFTC doesn’t
have nearly the amount of money to fight these bankers doing whatever they want and basically
Wall Street has Washington, D.C. in their back pocket, as a metaphor, and I think that’s
true. There are other opinions out there, mine is very strong and that’s the way I see
it, Ellis. Ellis Martin: So there’s easy money in shorting
right now. How long can that go on? David Morgan: Great question. It could go
on till it stops, which is a very non-answer answer, but I do have meaning behind that.
It could only go on as long as they’re able to keep this paper market put together and
it’s falling apart and we know that for a fact because you have the ideas that we’ve
seen also throughout the gold and silver communities where Germany has asked for its gold back
and the feds said, “Oh, it will take seven years.” I mean, when Venezuela wanted their gold back,
they did get it back in these armor trucks that went through the streets of Venezuela
and brought the gold home, basically, and they had a big celebration over that and of
course that was kind of dismissed as this tin-horned dictator, Chavez, and what a horrible
man he is and on, and on. I won’t comment on that I’m pro-liberty; I’m
pro-freedom. but regardless that was sort of dismissed. But Germany is sort of in a
different class politically, at least how the; what’s left of the free world thinks
and yet they’re given a short shrift. Like: “No, you don’t get your gold back right now.” It’s also happened in a Dutch bank that had
reportedly physical gold for clients and they made a statement recently saying they’d have
to settle in cash. And that is legal on the futures exchange, by the way, that is in the
contract that you sign when you sign up to trade futures that if they deem necessary
they can make you settle in cash, not in physical. The point being that the paper game continues
to wag the market, in other words, a tail wagging the dog. But that can only go on until
enough people stand up for physical delivery that it becomes apparent to enough people
that something is drastically wrong and that is taking place as we speak. Many of the ETF holders have bailed out on
the ETF, taken their paper and moved into the physical market on the gold side. And
that puts more and more pressure, and you’ll see more and more information coming out where
people can’t get the gold that they thought they had paid storage on for a long time or
there’s some kind of road block or some kind of delay. And this will happen more and more as we march
forward in time and that’s what it’s going to take. So there’s going to be a break between
the physical reality and the fiat fiction in the metals markets and really is taking
place but will become more and more apparent, again, as time marches on. Ellis Martin: I can see where all of this
would continue to add to a suppression of prices per se. However, with all other factors
running against suppression and all the demand right now which is not decreased or abated
for silver and gold, when can we see a turn around in metals prices? David Morgan: Well, I’ll give you my best
guess, I could use the word “analysis” but I’ll say “guess.” I think we’ve probably got
until the end of the summer. I wrote that in the last Morgan Report. Usually the summer is very dull for the metals,
not always, the seasonalities haven’t worked real well the last few years in the metals
markets. Nonetheless, I think you’ll see this really aggressive buying in the physical markets,
especially on the retail side, subside. There’s really two markets, I mean, there’s
several to the gold and silver markets, but they really break down to the physical reality
or this fiat fiction and the problem with the physical market in gold right now, from
what I have been able to determine, is that some of these ETFs are being drained of gold
but there’s also gold going into some of the depositories. And I know that for a fact because I know
some of these people on a first-name basis and I trust them and they have told me that
commercial bars are coming in to the facilities. So, the big bars, the commercial bars, are
coming in and the gold coins of denominations, and gold jewelry in the Asian markets are
being sopped up at a very high rate by the investing public. So, to look at the market in total, it looks
as if we’re still seeing enough supply coming in through the refiners and through liquidation
of some of the larger holders of physical gold to keep the market quiet for awhile,
and my guess is probably September or so you’re going to start seeing these markets come up.
I think you’re going to see gold above this smashing price of 1550 level, well beyond
that probably up to 16, 17, 18; it’s hard to predict. By the end of the year silver
will breach the 26 level, up to 27, probably up the 30 by the end of the year. And that’s all in a perfect world where the
bankers still have control, not accounting for any kind of a one-off event or a black
swan, if you will, that is out there. And it could be very quickly that something
manifests in the financial markets that’s somebody that really has some power isn’t
getting a gold delivery or something like that, that all of a sudden these markets start
moving up very rapidly. But discounting that, I think it’s going to take some time. I think
this is a transition year; that’s what I said in the beginning of 2013 and I’m maintaining
that idea that this is the year, 2013, where not only the people that are already in the
gold and silver markets acknowledge it but a lot of people that are on the periphery
that look at it on a casual basis, or a what-if basis, that are kind of just watching it for
entertainment purposes find out for an absolute fact that there is a physical market that
exists and there also this phony baloney derivatives market that is way, way, way over-extended
and it’s going to start falling apart. So, I think that’s going to manifest this
year. I really believe that. Doesn’t mean that when we have sky-high prices this year,
but it does mean that there’ll be a turning point or tipping point, if you will, that
the acknowledgment that, “Geez, I have to have gold and silver.” And I believe strongly there’ll be a day where,
in this bull market, and I don’t know when, where it will be extremely difficult to get
the physical metal at some point and I’m not talking about a roll of Eagles or a silver
bar of a hundred ounces or something like that. I’m talking about some big entity such
as the Central Fund of Canada or Sprott Physical Silver Trust or the Zurich Continental Bank;
one of these bigger entities that buys physical and has a no-nonsense policy where they don’t
use derivatives has a difficult time in gets delayed. When we see that, we pretty much
know that this derivatives covering of sales is starting to break down. Ellis Martin: We’ll be right back. The Ellis Martin Report is sponsored by El
Tigre Silver Corp., trading on the TSX Venture Exchange under the symbol ELS.V and on the
OTCQX as EGRTF. Silver has been considered a precious metal for 6,000 years and currency
since 600 B.C. It’s been commercially mined in Mexico since 1530 in mineral prolific and
mining-friendly Sonora State, where El Tigre Silver Corp’s 5000-meter drill program is
now underway. El Tigre’s properties with gold and silver mining concessions span approximately
267 square miles. With an attractive share structure and a strong,
proven management team, El Tigre Silver Corp. is poised to identify a resource in an area
that from 1903 to 1938 produced 75 million ounces of silver and 380,000 ounces of gold.
Additionally, their tailing stockpile is currently progressing to production. Learn more about
El Tigre Silver Corp. by visiting their website ElTigreSilverCorp.com or click through El
Tigre’s logo on the home page of our website EllisMartinReport.com. We offer expert opinions only. Find them on
our website EllisMartinReport.com. That’s EllisMartinReport.com. Ellis Martin: Perhaps I should be asking Rick
Rule or Eric Sprott about this, but do you think they have any more major purchases of
silver coming up, like they did several months ago with $26 an ounce? David Morgan: I actually have a pretty strong
relationship with Sprott, as you well know, and I asked that question and the problem
is that they’re in business to make money like anybody that has a business and they
need a premium on their PSLV to make it worthwhile and the premium has basically been exhausted
out of that. So, they really wouldn’t make an offering unless they can at least break
even on it. They’re not going to offer physical silver at a price where they’re going to actually
end up losing money. Which is unfortunate because it would be a
great time, in my view, to at least add to the position that they already have, but,
again, they’re in business, they have certain regulations and certain requirements that
they have to meet in order to make an offering and it just would not work at this particular
time. So, it’s a great question, it’s one that I had and I just had answered recently
and that’s the reason. Ellis Martin: And in addition to selling into
the futures market, are you accumulating more silver and gold bullion right now? It would
seem like if you’re going to do it this summer, now would be a good time. David Morgan: Yes. You know I’ve been a advocate
of this silver123.net, which is a monthly purchase program; I participate in that. But
on top of that, yes, I’ve been buying in the regular markets, physical, all along and I
continue to do so and I am willing to pay a higher premium currently because I feel
it’s worth it. I do think that the margins or the premiums
will come down during the summer, which makes it an even better buying opportunity. And
I honestly don’t think the ultimate lows have been seen for silver and gold at this point
in time. But I’m also aware of the fact that no one can call an exact bottom every time
and I’m willing to do what I’ve taught all along, which is the dollar cost average. And when it’s low you want to buy, but that
doesn’t mean you have to make your total purchase. It’s a lot smarter to just filter into the
market over time, say three month, five month, eight month, one year, type of a purchase
program, than it is to just try and pick an exact bottom and then find out your wrong
and be disappointed. Ellis Martin: Let’s talk about TheMorganReport.com.
What are you offering to current and new subscribers? David Morgan: Well, I’m going to be talking
about some of these newer reports that just came out. I haven’t finished reading them,
but I will before I write the report. The Silver Institute, Silver Survey 2013 just
came out so I’ll be reading that and commenting on it. Also, there is a bank report on the silver
market not looking that robust and they make some good points particularly about the solar
industry, which I will also be commenting on. You know, I try to be objective. One thing
that these analyses miss and where I stand on the other side of the fence from them,
is they already have the presupposition that the currency markets are fine enough and it
will never happen to them. In other words, they presuppose that the dollar market, the
U.S. dollar, is always going to be there, it’s always going to be settled that way,
everyone’s always going to want the dollar and because of that, well here’s, you know,
the situation: We’ve got this much supply, this much demand, investments are starting
to fall off, silver’s where it’s not going to be as robust, jewelry won’t be as strong
and all this stuff. Well, that’d make sense in a market where
the dollar really had strength and where the financial markets weren’t in the crisis mode
that they’re in. But I am on the other side. I think we are still experiencing a currency
crisis in kind of an ongoing way since the 2008 financial crisis, which every one refers
to in those terms. And it’s yet to be resolved and the problems that occurred at the time
have only continued to increase. And because of that fact, I believe that all
this analysis about what might happen in the industrial side or the investment side of
the silver market or the gold market, for that matter, is not looking at the big, big
picture, which is: We are in a world situation that’s never been experienced before. We’ve
been running the whole system on a lie and that is you can print wealth. It cannot be
done. Where adding more debt will solve the debt crisis; it cannot be done. And because of those two absolute facts, I
have a different approach. I say that all this stuff matters to a certain level until
the dollar breaks down further. And at that point people will look for whatever they can
to either preserve their wealth, get out of the situation that they’re in, which is a
currency that they don’t trust, and move into something they can trust and that’s always
been gold and silver, particularly in today’s world. So, that’s where I view the market and those
of course are factors that are never really commented on in these mainstream studies.
And if I worked for a mainstream bank or the Silver Institute or one of these other places,
I probably would have to have the same view, because it’s the establishment view, it’s
the mainstream view, and it’s held for quite some time. But if you look at what’s really
happening, and it’s really right there in front of us, what you’ll see is that nothing
has been solved since the 2008 crisis. I think that shook up everybody and, again, those
problems have only gotten worse, not better. Ellis Martin: Has nothing been solved since
2002, for that matter? David Morgan: I don’t think anything in a
significant way been solved. I do think that, yeah, the economy may be quote-unquote, “recovering”
in some areas and maybe there’s a pickup in the velocity of money and maybe the feeling
about the economy is better and all that can be true. But the fundamental facts of getting
out of this debt burden is not been solved and I don’t think it can be solved. I think
we’ve already passed the point of no return. Ellis Martin: With all the uncertainty happening
with the federal government, we don’t need to expound on that. Everyone is hearing about
it from every other direction. With all that uncertainty and all the trouble and everything
we’ve just discussed, we still have a relatively strong dollar. Does that mean we’re better
off then Western Europe right now? David Morgan: For right now. I mean it ebbs
and flows. I mean, we’ve done enough of these shows together and watched the financial markets
very closely and you’ve had times, when I forget who it was, but one of these very well-known
stars, I don’t follow that stuff much, I think she’s a model, said, “I don’t want the dollar
any more; I want to be paid in Euros.” So, there’s been time where, like, “No dollars
are no good; I want Euros,” and now, “Euros are no good: I want dollars.” And this is
kind of what I call the bankers’ last vestige of hope, pretending that one currency is better
than another. I’m not saying you can’t treat currencies as if they don’t move against each
other, but the ultimate reality is that they’re all fiat fictions and in the end they’re all
going down. I mean, if you look up what currencies are
doing versus gold from a long-term perspective, they’re all falling against gold and that’s
as it should be, because you’ve got the currency market and you’ve got the money market. The
money is gold and silver and the currency is just fiat fiction, it’s paper money, it’s
what we call currencies and it’s what people believe in. But they believe in them until they stop believing
in them and it’s not going to be 99 percent of the population, it’s not going to be 90,
it’s not going to be 25; it’s going to be just a couple percent of the population that
catches on in time and the rest of the people are going to wonder what the heck happened.
And what happened is something that’s been repeating again and again and again throughout
monetary history. And that is you cannot solve a debt problem with more debt, and paper finally
finds i’s intrinsic value and that’s practically nothing. Ellis Martin: Now, we can find you all over.
In addition to this radio show, you have your website; TheMorganReport.com or Silver-Investor.com,
and quite a few followers on Twitter. David Morgan: That’s right, and I also have
a You Tube channel, which is SilverGuru. We archive all the interviews that we do on that
channel. It’s myself, David Smith, our junior analyst gets interviewed from time to time,
and videos that we do and that type of thing. So, it’s a good place, if you want to catch
everything, that’s fine, I don’t know anyone that’s got that much time, but maybe some
people do. But if you want to pick and choose something you want to hear or see, go to the
You Tube channel, it’s probably one of the best places. The other place to go is to go to the website
and sign up for our free weekly report and that is also archived; everything we do in
a given week and we also take questions from our readers that we answer on a weekly basis.
So, there’s a lot of free information out there and for those that are serious can subscribe
to Money, Metals and Mining, The Morgan Report, and all that information is over on the right-hand
side of the website. Ellis Martin: Once again a great interview.
I appreciate your taking the time from your day to join me today. David Morgan: My pleasure. Thank you. Ellis Martin: I’ve been speaking with David
Morgan of TheMorganReport.com. Listen to the segment again on the podcast page of our website;
Ellis Martin Report dot com and download the entire program on iTunes. This segment has been sponsored by El Tigre
Silver Corp., trading on the TSX Venture Exchange under the symbol ELS.V and on the OTCQX as
EGRTF. El Tigre Silver Corp. is focused on silver exploration and development in prolific
Sonora State, Mexico. Find them on the web at ElTigreSilverCorp.com.

12 Comments

  1. If i owned a shop that sold PM's i would be telling everyone to buy gold and silver.
    My time investing in PM's i have seen youtuber's fight tooth and nail that PM's is the only investment and if your not in PM's you will loose everything!
    Fiat money is a medium of exchange ,i doubt it will ever fold.There is not enough gold and silver in the world to be a medium of exchange for 6 billion people.

  2. i wish there were more billionair like sprott in silver in there was 10 billionairs adding at least 15 million oz every year we would be going somewhere like the hunt bros did in the 70s

  3. You know there is a parallel planet Earth out there in the Universe that has silver at 1$… I wish it was here… ;o(

  4. Our dollar really isn't true fiat. It's pegged to oil, so the limit on printing is sky high. I'm waiting for a day that our dollar gets pegged to water once electricity becomes the major source of energy. But, it wouldn't be a bad idea to hold on to a small amount of precious metals as a dooms day fund.

  5. Couldnt agree more,i think LN Gas is the power of the future.It's abundance is everywhere. I always get thumbed down ,for stating the truth on PM's ,but people dont realise i stack and have been since 2007.I just hate how people put blind faith into PM's without understanding it. Alot of stacker's got burnt but will fight tooth and nail,on a subject hey know little about.Half my mates work in the mining industry and laugh at these so called experts.
    Cheers

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