Short Squeeze In Silver

[chux03]

Have you seen this article yet?? Here's a partial read of a few paragraphs complete with the link so you can read the whole thing. I'd post the whole thing but don't want any copyright complications or to be stepping on any toes. He's one the authors who write about silver that I NEVER miss what he has to say.



by Jason Hommel - March 3, 2008


What is a short squeeze?

A short squeeze is one of the most exciting events in finance, and could drive silver to $100/oz. very quickly! A short squeeze happens when those who manipulate the market begin to act according to old Wall Street rhyme,

"He who sells what isn't his'n, buys it back or goes to prison!"

The silver shorts, who have been one of the key forces capping the price of silver ever since 1980, are buying back the silver they sold, the silver that they don't have, the silver that may not exist, and they are buying "contracts for it" from people who might not have it either, in a rising market, because the shorts have begun to panic.

Another way to say it, is that the fat cats are beginning to wake up, repent and change, and realize the error of their ways! Perhaps we are seeing the inevitable failure of a 100+ year war of the international bankers, a war waged against an inherent property of silver. But silver is a monetary metal, and the failure to recognize that truth has consequences.

Dan Norcini reports at http://www.jsmineset.com/ that the commercial shorts in silver last week were "buying on the way up!"

http://www.jsmineset.com/cwsimages/Miscfiles/5830_Charts_for_2-29-2008_COT.pdf

The commercials are buying silver futures contracts from the category of traders that is labeled "non reportable" which are mostly small capitalized individuals, while the funds, or "speculators" have not changed their long positions much.

Short Squeeze definition:
http://en.wikipedia.org/wiki/Short_squeeze

"Short squeezes result when short sellers cover their positions on a stock. This can occur if the price has risen to a point where these people simply decide to cut their losses and get out. Since covering their positions involves buying shares, the short squeeze causes an ever further rise in the stock's price, which in turn may trigger additional covering."

Continues here: http://www.gold-eagle.com/editorials_08/hommel030508.html

[chux03]

And YES, I'm (still) buying...

[Barbaric Relic]

Silver at 20 $ is more than it was of course BUT look at the other pms all in the hundreds of dollars and even thousands, gold platnium.

silver really must be still cheap cheap cheap, isnt that a sound baby birds make before they FLY.

[chux03]

Great minds think alike and I've read that same "theory" in more than one place and by more than one author. I was contemplating a 3 ounce purchase of gold with an unused credit card account that I'm thinking of (finally, it's been unused for almost 4 years. I had to call them up and inquire if it was still good...it is) using specifically to replace the dollars in that account with gold. 3 different 1 ounce gold bullion coins. One Maple leaf, one gold Eagle and one Krugerand. Easy as pie, $3000 (the exact credit limit in that account) and I'd get 3 pieces of gold (although it would cost more now today). It would be the only gold I'd own. I'm thinking that within "not too long" gold is going to be high enough that I could sell back 2 of the coins, pay the bill off and pocket 1 gold coin for my troubles. OR...wait awhile longer, sell 1 gold coin, pay off the bill and pocket 2 gold coins. That was the plan...

Then I start hearing about the possibilities for silver (which I own already) and I'm rethinking the $3k gold purchase and instead going with more silver. In "normal times" I would advise against doing what I'm thinking of doing but these don't look like normal times to me. I would use the credit card for purchasing precious metals anyway though it's always with a debit card when I have purchased silver in the past. I think my girlfriend said it best when she said, "you're just taking one form of money and exchanging it for another (kind), you aren't really "spending" it..." I took that to mean she's hoping I'm going to "cut her in" HA!! But my thinking is coming around to sticking to acquiring silver, and sooner rather than later.

cheap, cheap, cheap!!

[TTAZZMAN]

Chux, I think any conversation concerning the silver short position should be discussed only after studying the articles put out by Ted Butler most all of his writeing concerns the silver short situation also he is constantly conversing with the COMEX about the situation

his site is

http://www.butlerresearch.com/archive_free.html

they are all good and worth reading the whole archive to understand the history but i would specificly point you to this article

http://www.investmentrarities.com/01-15-08.html

his work is worth the read

chux, just a opinion gold and silver can be extremely volitile be extremely careful buying on credit, it can bite you if you guess wrong, need to keep some powder dry in case we get a short term pullback

[chux03]

I read Ted Butler and have since I first read him oh, a year or two ago. Since I got serious again with physical silver. That's one reason I'm thinking silver is going up, especially when the shorts have to start covering. I can't imagine that's going to be very far into the future but I'm betting if silver goes up another couple of bucks these guys will start jumping out of buildings. On their way down they'll be passing silver prices shooting to the stars because of what they've...created.
That and the fact that I think these a-holes running the Fed, the Treasury, etc, etc are in over their heads. I am no dooms day prophet but from everything I've read these past months leads me to believe that there'll be bank failures, bank runs as well as all kinds of other "financial calamities" and that will also make silver go up in value. The powers that be don't know it yet but silver WILL be coming back into MONETARY favor, as will gold. Millions of people have trusted precious metals for thousands of years as safe, secure stores of value. One of the main reasons I always figured why that was so was precisely because the government (try as they might, I'm betting) can't make gold. They can mine it, they can tax & steal it and they'd probably go to war over it but a gold standard of some kind would be more stable and would keep the government out of financial mischief and as such would be WAY better for the American taxpayer. Soon as the general public figures out that INFLATION IS US GOVERNMENT MONETARY POLICY, their gig will be up... In the old days it wouldn't have been pretty. The French revolution comes to mind here. But today and personally I'd settle for seeing these criminals wearing orange jumpsuits for an extended period of time. Anyway...
(I think) I got these a-holes all figured out and I DON'T LIKE WHAT I SEE COMING DOWN THE PIKE FROM WASHINGTON DC. I truly believe that EVERYTHING that ails us as a country is plotted on Wall Street and hatched in Washington DC by fraudsters and criminals of the highest order and that they are the root of ALL our troubles. Government adds NO VALUE to the final product, ONLY COSTS.
Where will the line start for succession??
Oh, do I still sound "bullish" on silver?? Do you think I think it's going to continue going up? It ain't going straight up but I try to buy on the dips and I think if I have the money in todays climate I may buy all the way to $25 an oz THEN pull-er back for a spell. That's my current strategy...you won't lose one penny on buying silver up to $25 an oz imho, over the long term especially.
Bets?? :-)

[prahudka]

Oh, do I still sound "bullish" on silver?? Do you think I think it's going to continue going up? It ain't going straight up but I try to buy on the dips and I think if I have the money in todays climate I may buy all the way to $25 an oz THEN pull-er back for a spell. That's my current strategy...you won't lose one penny on buying silver up to $25 an oz imho, over the long term especially.
Bets?? :-)

I wouldn't bet against.