Silver extinction hype yet another price manipulation stunt
Analysts said all these hypes goes to the category of price manipulation, like the one attempted by the Hunt Brothers earlier, albeit, in a different manner & direction.
If U.S. Geological Society can be trusted, Silver got just seven years before it would become the first element in the periodic table to get extinct.
And yet it doesn't create any buzz in silver markets (may be 'panic' is waiting for the right time to appear, possibly in the last two years before its extinction year 2020) as many experts reject such reports even if it was raised by the USGS.
According to the USGS the total amount of silver mined in history is about 46 billion ounces. This compares to about five billion ounces of gold. This ‘mining ratio’ is 9 to 1.The current ‘trading ratio’ is 57 to 1.The ratio is clearly out of whack.
Analysts said any such figures might cause panic among traders, investors and above all net users of the white metal as the set USGS deadline of 2020 approaches.
They added that if that's the situation then silver prices would have hit at least $500 an ounce compared to today's average of $22 an ounce.
In view of the fact that most of the silver consumed by industry is ‘used up’, the expectation is that the ratio could narrow dramatically in the years ahead. At the same time silver investors stand to profit considerably on such situation.
They however said silver supplies all over the world are at their lowest levels in 200 years and dropping. Right now there are less than 200 million ounces of above-ground silver reserves.
But analysts said all these hypes goes to the category of price manipulation, like the one attempted by the Hunt Brothers earlier, albeit, in a different manner & direction.
But this kind of manipulation may not last long enough and silver prices may soon find its own way to go ahead even if a supply vacuum or a crunch appear soon.
Analysts added that radical changes are bound to occur after such manipulations cross the sustaining limits and large organizations or entities, capable of cornering and manipulating the markets, though for a small period of time, will crumble as like nature, the markets & price discoveries take their own right course.
They said silver bullion has become an increasingly popular option for investors who are seeking a safe haven asset during these challenging economic times.
Any moves to create a panic may work temporarily but not for too long but at the same time if the supply gets thinner, a price explosion may just be around the corner on heavy demand as commodity market play is all about demand and supply, they added.