"That imbalances in the supply and demand of precious metals, particularly
silver, could lead to a shortage of physical product in the future should not
come as a surprise to many - it is a topic covered extensively here in the past.
Nonetheless, as a useful reminder of the big picture in the silver market,
Future Money Trends has released another update video, reminding viewers that if
traded purely on fundamentals, there is a high likelihood of increases in the
price of silver, and other precious metals. As the authors put it, " There
simply isn't enough physical silver to deal with the demand of a fiat currency
crisis. As the paper silver market pushes prices down, all hell will break loose
in the physical market." While that conclusion may or may not be applicable just
yet, when coupled with recent revelations of potential double counting of
precious metals at the warehouse level (see HSBC-MF Global story), the situation
will certainly get only more exacerbated. Furthermore, should silver miners take
Eric
Sprott's advice to heart and decide to convert some or all of their product
into physical, the market will suddenly recall that in addition to liquidity,
prices are also determined by something called fundamentals. And fundamentals,
especially in combination with a market risk spike, confirm a price jump may be
imminent."
at http://www.zerohedge.com/news/physical-silver-shortage-spike-imminent
at http://www.zerohedge.com/news/physical-silver-shortage-spike-imminent