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3.04.2011

Maxwell's Silver Hammer

Bang Bang, Maxwell Silver Hammer
by Jim Willie CB - Hat Trick Letter

Everybody leaves the Beatles, whose strange songs are stuck in the memory of millions of people. "Bang, bang, Maxwell's silver hammer, came down upon her head. Bang, bang, Maxwell's silver hammer, made sure that she was dead." Little did the legendary Beatles realize they were providing the theme song for the linchpin of the USDollar in its lethal slide into the dustbin of fiat currency history. The song might have referred to Blythe Masters herself, the arrogant megalomaniac in wait, and the JPMorgan queen of ruin.

Silver rules! Gold is the victor, but Silver takes the spoils! The little sister shines! Central banks own no silver, nor do governments anymore. Industry requires and consumes silver, but not gold. Mint coin sales have exploded to record levels, and now struggle to continue amidst grotesque shortages. So on a supply basis and on a demand basis, silver is the dominant metal. In the last several months, Silver has shown its power and exerted its strong dominance. It has led the precious metals move, an explosive one. Gold has confirmed. Excuse the outline format, but the message is clear, offered without the burden of details. In this case, at this time, the important message is the firestorm of positive factors leading to a silver price explosion. The Jackass is on a brief vacation in Central America where the sun never stops shining. Apologies in last weekly article where mention was made of a negative real rate of inflation. The error was blatant in a slip of fingers. Given the price inflation of 8% in the USEconomy and near 0% rate of short-term interest, the inflation adjusted real rate of interest is negative. It is in the minus 7% to minus 9% range. That is a primary jet fuel accelerant for the gold bull market, a factor overlooked by the clueless cast of economist hacks!!


SILVER ON THE VERGE OF EXPLOSIVE MOVE

prepare for an explosive upward price move toward $40 this spring/summer
a bullish silver hammer was shown last week, with open & close at the weekly high
year end price target is $50 per oz should be easy to achieve
a flag pennant pause pattern has been completed at the 28-31 range
usually it signals a half-way mark, so get ready for a move to 40 in next runup
gains in silver have tripled the gains of gold, as Jackass forecasted late last summer
do not be surprised if in 2 to 3 years, the silver price exceeds $100 per oz
latest noontime reading was 35.22 per oz for silver, in breakout (03/04/2011 EST)

GOLD FINALLY CONFIRMS BREAKOUT

it was bound to happen, and finally it did, confirming the silver breakout
a rectangular pattern was evident throughout the consolidation period
gold has shown a very different price pattern behavior consistently
the entire global monetary system is in ultra slow motion breakdown mode
latest noontime reading was 1430.77 per oz for gold, in breakout (03/04/2011 EST)

GLOBAL SILVER SHORTAGES

strong industrial silver demand (not true of gold)

absent depleted USGovt stockpile from 1905 created by Teddy Roosevelt

fully 6 billion ounces of silver in stockpile has been exhausted for five years

numerous government mints around the world have announced no silver supply

evident in the futures contracts, in backwardation of varying degree

expect arbitrage in full force to continue to make backward price extreme

HUGE QE2 EFFECT ON COMMODITIES

monetary metals, industrial metals, energy, foodstuffs all rising fast in price

silver being accepted as monetary reserve, even as asset reserve

Chinese Govt announced plans to diversify reserves into silver

India is the first nation to begin a silver monetization plan

early stage of hyper price inflation in the global economic price structure

inflation adjusted real rate of interest is minus 7%, a primary gold market fuel

denials by USFed Chairman Bernanke is its confirmation !!!

Ben has a nearly perfect track record of wrong analysis and conclusions

DEPLETION OF COMEX VAULTS

demands for delivery have been heavy since September

secret supply bailouts come from BIS and even the Holy See

some sort of March delivery climax event might be in progress

China has targeted the COMEX for delivery raids

demand staved off by COMEX cash delivery with 25% bribe (contract fraud)

metals markets have no silver !!

CHINESE PLOT TO CORNER SILVER MARKET

China is angry at a broken secret treaty over Favored Nation Status grant

the USGovt sold the leased metal and cannot return it to China

China honored its side of the agreement by purchasing USTreasury Bonds

China is angry over the unilateral QE programs on US$ devaluation

the devaluation of the USDollar was done unilaterally without agreement

China is angry over charges of currency manipulation by the USGovt

the grand currency manipulator in gross violation is the USGovt & USFed

China senses an exposed jugular vein, and is using Sun Tzu war tactics

GIGANTIC U.S. MINT SILVER DEMAND

January coin sales were more than 2x the demand in previous months

mint coin sales are setting records not seen in 20 years

the USMint is purchasing silver from the open market

SPROTT FUND CHALLENGE TO SOURCE SILVER


the fund required over three months to secure the entire supply of bullion

its manager reports of extremely tight silver market, no loose supply

James Turk echoes the shortage claim, from his GoldMoney vantage point

MINING FIRMS BYPASS COMEX

the mining firms are not given a fair price by the metals exchanges

they are selling to the more honest investment funds, as metal source

the funds might strangle the official corrupted COMEX on supply cutoff

SLV SUPPLYING COMEX TO MEET DEMAND

SLV stock shares used to offset naked shorts of futures contracts

back door to fraud written in their fund prospectus, in careful language

129 million oz originally came from Warren Buffett, the great deception

prepare for a gigantic lawsuit from defrauded investors in late 2011 or 2012

penalty in negative 2% SLV price premium, which is heading to minus 25%

in time, the SLV fund will own zero metal .