The Silver Market: An 'Operation,' Not a Liquidation

VANCOUVER, Canada ( Bullion Bulls Canada) -- Recent commentaries have focused on the massive liquidation in the paper-gold market, as large investors (and in large numbers) have fled that paper in favor of real metal. It has now been established that this flight out of the paper-gold market was in response to the Cyprus "steal" -- and at least to some extent has been a choreographed event.

Naturally this had led to a question from readers: What about the silver market? Indeed, while the silver market has also seen the price for paper-silver plunge, there has been no corresponding liquidation seen with respect to demand for paper-silver.

So what is going on here?

Regular readers have already supplied their own answer to this question, via mail and in their comments on this Bullion Bulls Forum. In a nutshell, readers said: Yet another "manipulation operation" in the silver market. When any market exhibits some violent move in prices for no reason; we are justified in suspecting manipulation. When any market exhibits violent price-moves for no reason on a regular basis, we are justified in concluding that manipulation is taking place.

Such has been the case in the silver market, not simply for years but for decades. The primary whistle-blower in the precious metals sector has been GATA, the Gold Anti-Trust Action Committee. Yet despite its original focus on the gold market, it has spent increasing time/energy focusing on the silver market -- drawn by the especially blatant/egregious evidence present there.

Chart courtesy of Nick Laird,

What the chart above illustrates is not a recent phenomenon, or a temporary aberration. It is a permanent, heavy-handed club; being used by the same handful of bullion-banks to perpetually beat-down the silver market (and to a slightly lesser extent, the other precious metals markets as well).

In both its size and its concentration, it represents a significantly more extreme position in the market than that of the Hunt Brothers, when they were convicted (in 1980) of manipulating the silver market. By itself, it is conclusive evidence of silver manipulation.

Those readers interested in a more detailed, long-term examination of silver-manipulation can refer to an older commentary: Fifty Years of Suppressing Silver. And for those readers interested in even more historical insights into the silver market, there is The Silver Stealers, a detailed chronology of the silver market, by Charles Savoie.