Crowne Gold
FAQ Sign In Open an Account
Overview Buy Gold Buy Silver Sell Gold Transfers & Exchanges Physical Delivery Referrals Merchants
Brokers
Fees and Costs
 
Live Gold Spot
SPOT MARKET IS OPEN
closes in 07 hrs.24 mins.
Aug 16, 2007 NY Time
bid 662.6
change -2.8
contractmonth
high 666.3
open 665.4
openint
pctchangeS -0.42
prevclose 665.4
time_ymdhms 2007-08-16 07:24:16
volume
Silver & PGM'S
SPOT MARKET IS OPEN
closes in 07 hrs.24 mins.
Aug 16, 2007 NY Time
bid 12.34
change -0.10
contractmonth
high 12.52
open 12.44
openint
pctchangeS -0.80
prevclose 12.44
time_ymdhms 2007-08-16 07:24:24
volume
 
Ted Butler on continued deterioration - mar - 18, 2005

Dear Crowne Gold Clients;

Sean Trainor, President of Crowne Gold, Inc. 

www.Crowne-Gold.com

By Ted Butler
InvestmentRarities.com
Wednesday, March 16, 2005

The most recent Commitment of Traders Report indicated continued deterioration, with increased tech fund and speculative buying and dealer short selling in gold and silver. Extrapolating from the Tuesday, March 9, cutoff date, I would estimate that the dealer net
short position in COMEX gold futures has grown by some 100,000 contracts from the lows as the price rallied by more than $35. In silver, the dealers have increased their net short position by more
than 20,000 contracts as the price rose more than $1.25 from the early January lows.

While these increases in the dealers' net short position still leave room for more short selling and higher prices, the odds have also greatly increased for a short-term selloff of more than
insignificant proportions. Accordingly, while core long-term positions in silver should be held, highly leveraged speculative positions should be assessed. Preparations should be considered for aggressive buying if the brain-dead tech funds liquidate at much
lower prices.

I don't like to speak out of both sides of my mouth, but I am unsure where prices are now heading in the near term. Silver could explode
at any moment, given the spectacular fundamentals, even as a dealer engineered selloff would not shock me. But there is a larger issue here, which I hope is clear to all market participants and observers.

The larger issue is this: While there are any number of legitimate reasons, rooted in basic supply/demand considerations, to explain why silver should explode in price, there is one, and only one, reason why it would go down. That reason, of course, is dealer
engineering of the price. When the dealers decide that they want the price to go down, it goes down. End of story. They do this by collusively pulling their bids as the tech funds move to sell large
positions. How this is tolerated by free-market advocates, regulators, and, particularly, by the silver producers is a mystery to me.

In last week's article, "The Coming Silver Accident," I tried to show how short positions are open transactions that must be legitimately closed out in one of two ways -- by delivering that which was sold short or by repurchasing the short sale. I argued that silver has the largest short position of any item ever, and its
short position is many times larger than the real silver in the world that could be delivered. The only possible remaining way to resolve the open short position is by repurchase by the short sellers. To my knowledge, no one can refute this.

The very existence of such an uneconomically large short position is, in and of itself, criminal in nature. If someone or some organized group sells short and continues to sell short in quantities greater than what actually exists, and they know that, then that party is acting with the criminal intent to artificially depress prices. There is no legitimate explanation for why someone
would persist in such behavior. Just because the dealers make a profit with this criminal intent does not legitimize it.

If it's not possible to deliver and you are down to buying back as your only option to close out a transaction, you wouldn't sell more. You would do it only to control the price. That is not legitimate. It does not matter that there exists a willing counterparty, in the tech funds, who will allow you to reduce (but
not eliminate) your illegitimate short position from time to time. That just facilitates the manipulation and sanctions the criminal intent.

I believe that there is criminal intent behind the big dealer short selling in silver. There can be no other logical explanation. While I am sure the dealers and others play price games in many markets,
the significance here is that only in silver has the market rigging reached the level where no one can refute that the short position is greater than what exists or could be produced in a year.

The remarkable aspect to this crime in progress is that the regulators not only know all about it but also know the identity of the dealers who are acting with criminal intent. While not all of them may be necessarily involved, it is impossible that some of the
four or eight largest silver short sellers on the COMEX are not acting with criminal intent. That the CFTC and the COMEX process weekly reports from obvious manipulators and fail to act against
them highlights the worst of regulatory behavior. Hopefully, there will be a day of judgment for regulators who refuse to regulate. But it would be a mistake to assume that all law enforcement officials are asleep at the switch.

In a surprise to most, it was revealed this week that the long-time head and guiding force of AIG, Maurice Greenberg, was given an unceremonious boot. After all, AIG is the leading factor in the insurance world and Greenberg was considered the most powerful
individual in that world. I must say that it was not a surprise to me. It was also not a surprise to me that the attorney general of
New York, Eliot Spitzer, was credited with Greenberg's departure, as well as the previous dumping of Jeffrey Greenberg (Maurice's son) from the top job at Marsh & McLennan. Here's the headline from the
business section of today's New York Times: "In Clash of Titans, Chief of AIG Met His Match."

Regular readers know that I had long considered AIG to be the ringleader in the silver manipulation. That's why I had petitioned Spitzer to intercede against AIG. Because we have not read anything about AIG's silver involvement, some have accused Spitzer of not doing much about the silver manipulation.

It's my opinion and my opinion only that Spitzer privately intervened and caused AIG to retreat from the silver market or sharply curtail its activities. Spitzer could snap AIG or any company involved in wrongdoing like a matchstick, if he chose to. But he is more interested in reforming. It does not serve the greater good to put major
U.S. corporations out of business.

The problem in silver is that there is no easy solution except save sharply higher prices. When the silver manipulation breaks, it will be disorderly and disruptive. It will be a matter of great upheaval.
No official wants to be responsible for that.

But that is not to say that Spitzer hasn't done a great deal behind the silver scenes. Not all his activities must be in full view. And
I think he will do more.

 

Crowne Gold www.crownegold.com

is the easiest way to buy, sell, transfer, or use Gold as a currency outside the banking system.

 

 

TO JOIN:  Subscription is free, visit us at www.crowne-gold.com



 
  International Customer Service: 1-869-466-4977USA Customer Service: 1-775-841-3573