0:00 - Introduction0:30 - Cheaters5:07 - Shorts Hedging?6:24 - Banks Spoofing?8:51 - Gov't Response14:01 - A New Era Begins17:16 - Silver Shorts Legit?20:43 - What Has Changed?24:17 - BOA OTC Position27:58 - COT Reports30:53 - Silver Squeeze33:26 - Retail Premiums38:41 - Industrial Users43:44 - 1000oz Bar Market48:27 - Wrap Up
Tom welcomes Ted Butler back to the show to discuss the recent activity in the metals market.
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Ted discusses the Comex's 'commercials,' composed chiefly of banks and financial institutions which arguably aren't using the futures markets for legitimate reasons. They are speculators and are not legitimate hedgers. They cheat the other traders by sending out false price signals and utilize algorithmic systems to manipulate the rest of the users.
Today, we're down in silver because these commercial interests suppress the price by artificial means to get others to sell. So in every price decline, the commercials manage to be net buyers while everyone else is net selling. It's like a three-card monte game only with millions and billions at stake.
Spoofing is a short-term tool used to suppress prices briefly. The CFTC should instead be concerned by the concentrated size of these short positions.
Ted has received many responses over the years from the government, and usually, they tend to dispute and reject most of his points. They often argue that the concentrated positions don't matter. However, earlier this year, he wrote to his Florida Congressman, who did an excellent job following up with his concerns. This time they didn't argue and instead passed on the information to the enforcement divisions.
The big shorts have been reducing their positions and are now at the lowest levels since 2015. If banks don't add to these positions, then on the next rally, silver will fly. These big banks have gone through a lot of work to reduce their short positions. As a result, the message may be getting through to the government and these crooks.
The silver squeeze movement has brought much attention to silver, and because silver is still a small market, there will be a lot of room for new investors. So the sky may be the limit from here.
We've been in a tight trading range for silver for some time, which has kept silver demand somewhat at bay. There are few sellers today, even though retail demand is steady. The single best reason to buy silver is due to the manipulation and because it can't stay that way much longer.
Talking Points From This Episode- Cheaters and the methods used by large financial firms used to manipulate markets.- Why the manipulation is ending, and we are entering a new era.- Ted's opinion of COT reports and some of the manipulation theories.- The silver squeeze movements impact and overall demand for the metal.
Theodore Butler is an independent silver analyst who has published unique precious metals commentaries on the internet since 1996. He is the head of Butler Research LLC, where he offers a subscription service of weekly commentaries, including detailed analysis of the Commitment of Traders Report, regulatory developments, supply and demand considerations, and topics of interest to investors in precious metals, with an emphasis on silver.