Silver Prices

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CFTC’s Chilton Assures Silver Price Manipulation Probe Not Over

By , Money Morning -

A report Monday that the Commodities Futures Trading Commission (CFTC) would drop its four-year-old probe on silver price manipulation may have been premature.

According to The Financial Times, the CFTC was supposedly unable to find enough evidence to support the claims after reviewing 100,000 pages of documents and interviews. But Bloomberg News reported today (Wednesday) that CFTC Commissioner Bart Chilton said silver price manipulation did occur, and he's intent to find it.

"I continue to believe, consistent with my previous statements and information from the public, that there have been devious efforts related to moving the price of silver," Chilton wrote to Bloomberg. "There have also been silver and gold market anomalies outside of the silver investigate window that have raised, and continue to raise, market concerns."

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Summer Slump in Silver Prices Closer to an End

By , Money Morning -

Silver prices have suffered this year as the white metal has lost its luster as a safe haven investment, but the pullback has slowed and may be bottoming out.

Cash has gained some allure over metals, but according to FX Empire, as bullion prices near support levels buying interest has been on the rise.

In July, silver prices broke out from a three-month price slump and closed up 1.1% to $0.302.This came after fourth months of consecutive losses: 0.5% (June), 10.5% (May), 4.5% (April) and 6.2% (March).

Silver prices ended last week on a positive note, up $0.54 to $27.69. Futures and options players made bullish bets at the end of last week on the commodity based on speculation for additional stimulus from the Federal Reserve.

This week, silver prices have continued their rise. The metal's up 0.3% to $27.84 an ounce.

Can this uptrend continue? Here's what to expect from silver prices in the near term.

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Silver Prices Ready for QE3

By , Money Morning -

Recent economic data might be enough to get the U.S. Federal Reserve to finally commit to more stimulus measures, which in the past has delivered a good run for silver prices.

The United States last week reported economic growth of just 1.5% for the second quarter of 2012, down sharply from the rates posted for the previous two quarters.

As a result, the Dow Jones Industrial Average jumped as traders anticipate more economic stimulus from the Federal Reserve, either at the Federal Open Market Committee (FOMC) meeting this week or when Chairman Ben Bernanke speaks at Jackson Hole in late August.

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Silver Prices: Metals Rise on Hopes of QE3

By , Contributing Writer, Money Morning -

Fresh weak economic data and comments from Federal Reserve Chairman Ben Bernanke have stoked hopes that another round of quantitative easing is on the horizon. Those expectations gave gold and silver prices a boost this week.

Glum retail sales numbers released from the Commerce Department on Monday and high initial jobless claims on Thursday fueled optimism of QE3 despite the lack of hints from the central bank chief earlier in the week. But, Bernanke and his team have clearly left the option of QE3 on the table and stand ready to intervene when they see fit.

The markets' recent spate of lackluster financial reports and escalating concerns over the waning global economy are suggesting a pressing need for QE3 - sooner rather than later.

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Investing in Silver Still a Shiny Option

By , Money Morning -

After the U.S. Federal Reserve's announcement last week that it would keep doing Operation Twist, silver prices dropped 4% the following day.

Adding to the white metal's decline was weakening in U.S. manufacturing, a declining Chinese factory sector and worries about the Eurozone.

It wasn't a great week.

Jeffrey Sica, chief investment officer of SICA Wealth Management LLC, said to Reuters, "When you see slowdown in China and in the United States and the debt crisis accelerate in Europe, it leads people to believe that we will have significant depreciation, especially when commodities and precious metals prices have been so tied into the monetary policy."

Since last week's decline, silver prices have been mixed and yesterday (Wednesday) they closed down 0.13% to $26.91.

The markets have a slew of economic data to review and mull over this week along with the two-day European Council meeting that begins Thursday in Brussels.

Despite last week's slump, there's still reason to be investing in silver. Its prices in the first quarter fared better than the other precious metals.

As legendary investor Jim Rogers told a financial advisor summit Wednesday, the likelihood of more central bank action around the world is bullish for silver.

"Governments print money - that's all they know," said Rogers. "So own real assets like silver... and you'll survive."

Rogers said of all the precious metals if he had to buy just one, it would be silver.

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Silver Prices Look to Rebound

By , Money Morning -

Silver prices did not fall as much as some expected following Spain's $126 billion (100 billion euro) Eurozone bailout last Sunday. Many investors planned for a spike in the U.S. dollar following the bailout, hurting silver prices.

With everyone's attention focused on the Greek elections this Sunday, silver prices might be the beneficiary of any more turmoil and bailouts overseas. Money Morning Global Resources Specialist Peter Krauth recently weighed in on the subject of silver prices and the Greek elections.

"If Greece is allowed to leave, that will shock Europe into ensuring all is done to keep the larger faltering economies of Spain and Italy from leaving," said Krauth. "If Greece stays, it will likely do so under renegotiated, somewhat relaxed austerity conditions versus those that were required in its last bailout."

"So it's a case of print if you do, or print if you don't," continued Krauth. "There is really little else central bankers know how to do. While nothing's certain in this world, it's a pretty safe bet that raising rates is not something that's happening anytime soon. And that's why the money printing that's likely to come has one antidote: hard assets like gold, silver, oil, and other commodities."

News that Europe's central bankers will work together to stabilize the markets if needed following the Greek elections left silver up 1% Friday to $28.71.

With Europe hinging on Greece's vote this weekend, now presents a good opportunity to take a position in silver.



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Silver Prices: Market Loses $90 Million to Ponzi Scheme

By , Contributing Writer, Money Morning -

Silver prices this week dipped after U.S. Federal Reserve Chairman Ben Bernanke failed to confirm that more economic stimulus is on the way. Silver prices hovered below $29 an ounce Friday.

Meanwhile, millions of dollars that would have been invested in physical silver it turns out were instead held in a $90 million Ponzi scheme orchestrated in South Carolina.

The Commodity Futures Trading Commission (CTFC) reported Thursday it charged Ronnie Gene Wilson and Atlantic Bullion & Coin, Inc., both of Easley, S.C., with offering contracts on silver sales, but never actually purchasing any metal.

The CTFC maintains in a filing Thursday in U.S. District Court in South Carolina that Wilson and Atlantic Bullion & Coin violated the Commodity Exchange Act and CFTC regulations by operated a Ponzi scheme dating back over a decade and continuing through Feb. 29 of this year.
Wilson and Atlantic Bullion & Coin fraudulently obtained at least $90.1 million from some 945 investors, the CTFC alleges.

The CFTC received jurisdiction over the entities from Aug. 15, 2011, to Feb. 29. During that time, Wilson and Atlantic Bullion & Co are accused of deceptively obtaining at least $11.53 million from at least 237 investors in 16 states under contracts of sales to buy silver, without buying or delivering the white metal.

According to the CTFC charges, Wilson and Atlantic Bullion issued fake account statements to unknowing investors who believed they had invested in silver.

The CFTC is after compensation for scammed investors, a return of illegal gains, civil monetary penalties, trading and registration bars, and permanent injunctions against further violations of the federal commodities laws if successful in its suit.

Cases like this are why choosing where to buy silver is a decision requiring research - which we've done for you in our special report, "How to Buy Silver."

However you choose to buy physical silver, gold or other precious metals, the most important rule is to deal only with reputable dealers who have proven experience in the business and clearly stated policies and warranties - especially if you're purchasing by phone or online.

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What's Next for Silver Prices

By , Money Morning -

Silver prices got a boost yesterday (Wednesday), giving brief relief to their three-month downtrend.

The white metal rose on short covering and bargain hunting purchases. As gold touched on a new low for the year before rebounding, silver closed in on $27.983 for the July contract, up 19.2 cents. But silver priceshave dropped in 16 of the last 21 trading sessions through Wednesday. So why the volatility?

Here's what's weighing on silver - and why a price rally is still to come.

The Bears are Out

It hasn't been a pretty marketplace and as we enter the summer months. We've seen Facebook fall flat with its IPO, questioned whether Greece will leave the Eurozone and asked if Spain is in more serious trouble than initially thought.

The troubles have weighed on silver prices. Silver spiked to over $35 an ounce in late February, but has since slipped back near $28 an ounce, where it started the year.

Just in the last month, the Global X Silver Miners ETF(NYSE: SIL) has fallen almost 19%. The month isn't quite over yet and there are still hurdles for silver prices to face. The U.S. economic growth numbers just released Thursday showed first-quarter growth slowed to 1.9%, down from a previous estimate of 2.2%. The latest U.S. employment numbers will be released Friday.

This data combined will give a preview of what the Federal Reserve policymakers could hash out at their June meeting.

And should Spain ask for a bailout of Greek proportions, metals could drop in the short-term as investors run to the safety of the dollar.

But the long-term silver prices outlook remains bullish, as we told you a few weeks ago. "The long-term bull market is still very strong," Charles Morris, who oversees about $2.5 billion at HSBC Global Asset Management, told Bloomberg News earlier this month. "Silver spends more time going nowhere than it does going up, but when it goes up it tends to do it very quickly." Silver's next upside breakout has been forecast to come between $29 and $30 per ounce, where it's trading now. What will help boost the metal higher?

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Silver Prices: An Option Trading Strategy That Tells You When to Buy

By , Contributing Writer, Money Morning -

As last week's Money Morning special report pointed out, the long-term fundamentals for silver prices are decidedly bullish.

However, in today's volatile market, picking the right time to buy silver is something of a guessing game.

But if you are familiar with options, you can let them be your guide in learning precisely when to buy.

And here's the best part: This option trading strategy will only cost you a few dollars.

It works with either options on silver futures - e.g., the standard 5,000-ounce Comex contract, recently valued at around $140,000 - or any of the much more affordable silver-based exchange-traded funds (ETFs) on which options trade.

Taking the Guesswork Out of Silver Prices

For ease of explanation, I'll base our example on the iShares Silver Trust ETF (NYSEArca: SLV), recently priced at $27.34. For comparison purposes, the price of a single SLV share typically tracks the price of one ounce of silver, but is usually 75 to 80 cents lower.

Here's what you do:

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Special Report: How to Buy Silver

By , Money Morning -

In late December, silver dipped to a 12-month low near $26 an ounce, and traders who responded to the barrage of "buy" recommendations were quickly rewarded as the metal soared to a high of $37.18 just two months later.

Today, silver has pulled back below $29 an ounce, giving investors another chance to establish a position before the metal makes its next move higher.

After all, the fundamental case for silver prices remains as strong as ever.

The U.S. dollar continues to weaken, inflation remains a concern, silver demand from industry and emerging markets remains strong even as supply shrinks - plus we're facing growing uncertainty over the outcome of the 2012 elections.

It's a perfect recipe for higher silver prices - most likely even higher than last year's peak at $50 per ounce.

But what's the best way to play the next upmove by the "poor man's precious metal"?

For the purist seeking to hold metals as a long-term store of value and a hedge against inflation and global turmoil, the first choice is always the physical silver itself.

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Three Reasons Silver Prices Will Rally

By , Money Morning -

With the recent volatility and lows in the gold market, many investors also have been wary of silver prices.

Silver on Friday closed down 0.4% to $28.87 per ounce. For the week, prices dropped 5.1%.

Not the prettiest picture, but for the year silver has increased more than twice the price of gold thanks to growing confidence that the global economy will dodge another recession bullet.

David Jollie, an analyst at Mitsui & Co. Precious Metals Inc., recently said to Bloomberg News, "A greater amount of confidence in the global economy generally means higher growth and that means more silver demand. If you look out beyond the end of the year, you can still see reasons to be bullish."

Why Silver Prices Will Rally

Increased Demand: The global head of metals analytics at Thomas Reuters GFMS, Philip Klapwijk, has forecast silver sales to increase as end-users expand inventories that thinned at the end of 2011.

A large portion of silver demand - 80% - comes from fabrication, which is expected to rise about 3% to 5% this year to roughly 900 million ounces.

Also helping is China's manufacturing expansion and an increased electronics industry demand.

Klapwijk also sees current monetary policy increasing investors' appetite for silver and triggering a subsequent price rise.

He expects "a continuation of very loose monetary policy," he wrote in a report earlier this year. "We also see rates likely being cut in some of the emerging-market economies such asChina, India and Brazil."

This means current silver market lulls are great buying opportunities since the long-term outlook remains bullish.

Klapwijk toldDow Jones Newswire, "We see a range for silver north of $40 and maybe getting to a low of $28" per troy ounce.

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Silver Prices: New Chinese Futures Trading Supports Rally

By , Money Morning -

We already told you that silver prices would rally this year, and developments last week could make the surge approach even faster.

The white metal was trending down last week until dovish remarks from Team Bernanke following the Federal Open Market Committee meeting on April 25 reversed the price slide. Spot silver prices on the Comex ended the week at $31.27.

But there's another reason supporting a long-term silver price climb.

That reason lies in a news item out of China that many investors may have missed.

China and Silver Prices

On April 26, China Daily reported that the Shanghai Futures Exchange received approval to begin trading silver futures.

Previously, Asian investors had to access international markets to trade silver futures, or else they could trade indirectly on local Chinese markets.

"There has been an absence of a means of trading in silver in China," Wang Ruilei, an analyst with precious metal trader CGS Co Ltd, told China Daily. "The market will be bigger and more liquid with the advent of these futures contracts."

The Chinese announcement allows for two major things to take place.

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Buy on the Lows as Silver Prices Will Rally in 2012

By , Contributing Writer, Money Morning -

Silver prices Friday headed for a gain of 0.9% this week, its biggest weekly gain in nearly two months as the metal has taken a dip this year.

But silver prices are set to rally in the second of half of 2012, according to a report from the global head of metals analytics at Thomas Reuters GFMS.

Philip Klapwijk of GFMS says silver sales for industrial application as well as for jewelry, silver, silverware and photography will rise as end-users restock inventories that diminished in late 2011. Fabrication demand makes up 80% of total demand for the metal, and should be up about 3% to 5% this year to roughly 900 million ounces in 2012.

Klapwijk told Dow Jones Newswire, "We see a range for silver north of $40 and maybe getting to a low of $28" per troy ounce.

GFMS's independently researched and assembled World Silver Survey 2012, released Thursday, stated silver prices will pick up into the end of the year. Factors boosting investors' desire for silver will help drive the price.

"We see a continuation of very loose monetary policy," Klapwijk said. "We also see rates likely being cut in some of the emerging-market economies such as China, India and Brazil."

This means current silver market lulls are great buying opportunities since the long-term silver prices outlook remains bullish.

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How To Buy Silver: A Guide To Today's Top Silver Investments

By , Money Morning -

As precious metals go, silver may not have quite the same mystique as gold.

But let's be honest: The "white metal" has its backers, too.

In fact, when Money Morning published its "How to Buy Gold" special report just a few weeks ago, one of the biggest questions that we received in response was: "When can you do the same for silver?"

That's just what we've done here. In this special report, we show you how to buy silver.

Silver: The "Other" Precious Metal

Although gold possesses the greatest allure of precious metals, silver has a longstanding tradition in many cultures - a tradition that in some cases reaches back thousands of years. Nearly 2,500 years ago, for instance, China was the first to use silver as money.

Here in the United States, silver alloys were still present in some of our everyday coins as recently as 40 years ago. Today, however, silver is no longer viewed that much as a monetary metal. But that's because about 40% of silver is used for industrial applications.

The physical silver market is small, with annual demand of slightly less than 900 million ounces.

Since the financial crisis of 2008, silver prices have increased by 300%.
And that's only the beginning. Silver is on the verge of a massive "short squeeze". The last time something like this happened, investors pocketed upwards of 195% in just a few months - but more on that later (Or you can get a sneak peek of our new silver special presentation right now. You can find it here.)

An important metric to understand and watch is the silver-to-gold ratio. It tells you how many ounces of silver it takes to buy one of gold. Historically, that ratio is 16 to 1. On this basis alone, silver should be much higher right now.

But perhaps a more realistic level, at least in the short term, is the ratio of silver-to-gold since the start of this bull market back in 2000. That ratio has been about 50-55 ounces of silver for one of gold. Even this more conservative estimate of silver prices vs. gold provides an excellent opportunity for investors to cash in as gold prices continue to rise.

How to Buy Silver

Like gold, silver investments can be made in a variety of forms. Let's take a look at some of the most popular.



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Physical Gold and Silver Dividends Offer Investors the Best of Both Worlds

By , Money Morning -

What if I told you there was a company that paid its shareholders in physical gold?

Would a "golden dividend" be enough to get you interested in gold stocks?

If not gold, what about silver?

Neither one of these options even existed when I first started talking about them just three months ago.

But thanks in part to billionaire resource investor Eric Sprott, today's investors can benefit from a dividend payable in physical gold or silver.

Sprott had sent a letter to silver producers, suggesting they reinvest some 25% of their earnings back into silver, rather than in cash at the bank.

That took my earlier discussion about gold and silver dividends to a totally new level: dividends in kind.

These aren't paper profits, but real, hold-in-your-hand gold and silver dividends.

For precious metals investors, these "hard asset" dividends make perfect sense.

Today, one innovative gold and silver producer offers investors the best of both worlds.

Finally: Physical Gold and Silver Dividends

In a bid to gain the "first mover" advantage, Gold Resource Corp. (NYSEAmex: GORO), a low-cost gold producer, is launching a gold and silver dividend program on April 10, 2012.

The company has already paid out $41 million in dividends to its shareholders over the past year and a half.

But now they are offering shareholders a unique option by partnering with Gold Bullion International (GBI). GBI is a New York-based precious metals provider to individual and institutional investors, with storage vaults in New York, Salt Lake City, London, Zurich, Singapore, and Australia.

Essentially, GORO shareholders can elect to convert their cash dividends into Gold Resource Corp. "Double Eagles" consisting of one ounce 0.999 fine gold and/or one ounce 0.999 fine silver rounds.

These "Double Eagles" will be drawn from GORO's physical treasury and placed into the shareholder's "individual bullion account" with GBI.

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