A small Croatian audience was treated today at the Mimara Museum by Thorsten Schulte, known as the “Silver Boy” from Germany, and his presentation on why silver must represent a significant part of everyone’s portfolio going forward.
Due to all the negative news we are getting from everywhere in Europe(by Europe I mean the periphery), it is not surprising that people would want a hedging instrument to counteract Mario Draghis’ printing presses. Real “stuff”, such as valuable precious metals and other industrial commodities have a long bull market and according to Thorsten there is still time to jump onto the silver bandwagon.
Underpriced and manipulated
It was pretty amusing to see a room of bankers and financiers closely listening to a former Deutsche Bank commodity supervisor as he basically called for an end to the current monetary order. Strange enough, he expressed his view that he didn’t expect any deflation in the future, but rising inflationary pressures. This definitely goes in line with statements made at last years Cheviot’s Sound Money Conference and David Morgan’s speech regarding the subject. Others, such as Peter Schiff, Marc Faber and Max Keiser also stress the fact of wealth preservation through the ownership of silver and other precious metals.
The case for silver being underpriced is more of an investment argument, than an industrial one. The total market cap of all the mining stocks is less than the market worth of one or two juggernaut companies, and the representativeness of silver and gold in portfolios around the world are miniscule to say the least. The investor demand isn’t there yet; coupled with a massive fractional based silver and gold market such as the NYMEX in New York provide artificial downside pressure on these commodities.
Unlimited amounts of liquidity are also a source of manipulation from the banking sector because by using as I like to call shadow derivatives (naked shorts), they can artificially suppress the price of these commodities. And if they get a certain trade wrong, its OK, because an unlimited credit line will be extended to the bank from the largest and over bloated GSE’s on the planet. (O yeah, they are called central banks).
Isn’t it also convenient that in Croatia, these forms of investments are classified as luxury goods are charged with excessive import duties and taxes? The government doesn’t seem to realize that the populace would also like a certain mechanism which would allow them to preserve purchasing power and to generate a store of value.
After all, it’s only fair if the government goes on a spending binge through credit creation, that the “average Joe” has a fighting chance to survive in this debt constructed fiat prism.
Also check this video post from the Keiser Report a couple years back on silver manipulation, to see where we stand today. Among silver, Max explains rigged markets, a falling market, well…..a lot of fun stuff. Enjoy
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