Silver and the Power of Leverage

[gspotjazz]

Great call; great vid. You nailed this one. I'll be following you a lot more here. my sense is you know the markets better than most others. Thanks.

[SilverPatri0tsGeorge]

____________ Join the NEW group Silver Patriots ______ Search for the video : We Are the Silver Patriots _____ join the fight with us and tell your friends ______we all get together and share information _____We the ppl create the internet buzz _____We have a true leadership ______________________________­_WE NEED YOU

[merlinspower]

Today 4/25/2011 one oz.. of silver sells for OVER $ 47.00 The Paper dollar is CRASHING in value. The facts are that The NAtional debt goes up every HOUR 188 million dollars!. The paper isn't worth the ink thats printed on it. Silver is 4 times rarer than Gold , it is needed in industrial electronics. I continue stacking. Silver will go to $ 50 per Oz., this week . Mark MY  words . Buy and hold physical silver. Its easy to liquidate.Hedge against inflation.

[merlinspower]

Today 4/25/2011 one oz. of silver sells for OVER $ 47.00 The Paper dollar is CRASHING in value. The facts are that The NAtional debt goes up every HOUR 188 million dollars!. The paper is worth the ink thats printed on it. Silve ris 4 times rarer than Gold , it is needed in industrial electronics. I continue stacking. Silver will goe to $ 50 per Oz., this week . Mark MY word . Buy and hold physical silver. Its easy to liquidate.Hedge against inflation.

[van1976]

Looks like on Ebay I can get mid $50 for my Silver Maples (I bought at $17) and I could pay off some of that silver I bought from $30 to $45....tempting. "Sell in May and go away" I heard you say.

--Van

[Eraser7622]

$43 and counting... You really think this move up is due to leverage?

I swear John.. I don't know which John to believe anymore.. the John who a couple years ago was saying silver could go to the moon due to the manipulation scheme, OR the John today who sells physical, plays the shorts and calls silver's top. I'm sorry if this comes across as rude, b/c that's not what I intend. I intend ONLY to point out inconsistencies at a time when your viewers need the old John more than ever.

Best

[aqeel3344]

I have paper silver, my objective is to exchange is with cash when the price goes up and jp morgan crashes. Am I gona be able to do that? or whats the story exactly for ppl holding silver paper? your inputs highly appreciated thanks

[veritasfiles]

The volume was really low on this video, but the content was great! Thanks!

[ArgentPur]

Read Mike Maloney's Hunt Brothers analysis. If the Hunt brothers did not leverage through the corrupt system, they might still have their fortune today.  And we probably would be seeing silver at its true value.

[ChrisPCrunchy]

Or the CME could increase margin requirements & trigger mass liquidation of leveraged positions.

Its a catch 22 we need physical buyers taking delivery to flush out the paper shorts who have no real precious metals. Leveraged speculators can't take delivery as they dont have all the funds. So the more people who are leveraged, the more demand for physical precious metals is diverted into a manipulated paper market & the easier it is for J.P.Morgan & HSBC to bury the longs in unbacked paper.

[0urGaia]

Just had look at spotmex, very polished site. I have added spotmex banner to my small website, more that do so, will help improve its google index rating. Might be an idea to provide a few different sized banners under contact or help menu.

[charlesfuchs]

$50 is the target this year, however we will test somewhere around $30. If you think about it. who cares

[carlhopkinson]

what would a stock market crash do for the incumbents chances of remaining in political office or even avoiding swinging from tree branches?

A crash of which you speak could get easily out of hand and cause another 2008....I thought they were trying to avoid that?????

[carlhopkinson]

Still top calling, eh? 

[drutter]

I appreciate the information about leverage. You have a shitload of informative videos that will be educating people for many years to come.

[TrustNoShadows]

John...Have you ever checked out Reggie Middleton's boombustblog? It's pretty good stuff. He always mentions how dangerously leveraged the big banks are...to the point where a 1% drop could completely wipe them out. Scary!

[93msinclair]

The majority of the leverage is JPM's short position.

[GSDebunked]

sorry, what do you mean theres a 'gap' at 36? i looked at the chart and dont really understand

[66boeken]

Wish I could know 1/10 of what you know about investing. I started too late. Great videos, thanks

[campeona5]

BTFD!

[wyoraider86]

"The money printer will continue to print...of that I am sure."--Marc Faber

[ytrogergt]

GET A BETTER MICROPHONE, John!

[buttonmonkey01]

turn up your volume

[LibertarianChristian]

Cheers, great video. Made my first video on Australian's opinion of freedom and government, let me know what you think.

Thinking of making a video on silver, your vids will help with info :)

[edgegame]

Great analysis of the situation. Ties in with one of Maloney's scenarios, Martin Armstrong's recent essay, political gridlock thanks to Republicans in US, inflation already showing signs of dropping off in UK...

[SuperAdamBill]

thanks John, always an education listening to you.

great channel

[0urGaia]

Thanks for sharing your insight John, very kind. If commodities does take a hit I'm presuming Oz dollar will as well so perhaps a large silver correction from an Australian perspective will not be as bad.

[nlucctw2]

Have you even watched Mike Maloney's recent video on Metals Stocks vs. Physical Metal? I have to agree, the scarce thing and most sure thing is physical. Not sure why anyone would want to introduce risk into the situation when there is a sure thing.

[SnoutDonuts]

Hey john i got the same poster. its a old ww2 propaganda poster when fears of a german invasion of britian were possible. keep stacking.

[stellaconcepts]

@SnoutDonuts ha! didnt know that - love it! ;)

[lizadfuel]

I agree for awhile after QE2 there will be behind the scenes monetizing the debt. However, in the US its all about getting votes and keeping the system inflated.

We could see a significant pullback in the stock market and G/S. But eventually the FED will have to step in and initiate QE3 because they are the only organization willing to buy US debt, and the big correction ahead will be the excuse to initiate QE3 - IMO.. Peace

[odin422]

VOLUME!?!?!?

[cpswyl2]

selective rules on leverage eg, 50-100% margin on silver, whereas other areas equities/other commodities remain leveraged as-is could hammer the precious metals market. But that's valuing the physical through the massively leveraged fiat currencies. WOuld be interesting to see what deleveraging of the forex market would do. I suppose it's leverage that's taken on the role of debt-creation. Very scary times to be all-paper

[cpaulpsy]

Please up the volume.

thank you

[smokiethebear912]

I applaud your bringing rationality to an otherwise irrational market

[LibertyDownUnder]

John, as far as I know, very few gold / silver investors (physical) are leveraged.

The ETFs will fall in the long term, but physical is safe.

Unless you have data that says otherwise?

[stellaconcepts]

@LibertyDownUnder the average joe is not leveraged thats correct... but it only takes a few hedge funds to start looking at silver (or any market) to build leverage.

[deadlizard64]

Was the QE2 / Ship metaphor intentional :P

[slimnskinny]

Nvm just my setting (:

[slimnskinny]

can you speak up in your vids i can hardly hear u!

[ArgentPur]

Nice vid great insight about leverage. Appreciate the education. Keep up the great vids.

[stellaconcepts]

@economyvsstate im thinking $30.

[stellaconcepts]

@cj747747 I didnt say to do that.

[DuvallSilver]

can t hear u

[STOPPUCKNOW]

nubiru is behind h=johns head

[a10fjet]

why do they want to raise the debt ceiling? why not just get rid of it? it obviously doesnt mean anything

[addbball]

John, I think you are doing people a disservice here. It seems to me that this video is going to encourage people to wait for a huge correction below where silver is now. I don't see that happening. I think people need to get as much silver as they can before it hits $50/oz.

[syyenergy7]

@addbball I agree. The USD is lot softer than the experts say. When the USD really goes south watch the metals soar in all currencies.

[stellaconcepts]

@addbball disservice? perhaps you don't remember me screaming from the ceilings to load the boat at $11, $14, $17. All I am saying in this video is be aware of how leverage can swing markets - up and down.

I don't think people should blindly jump in at any price, assuming everyone on this channel has a core position.

I've stated in many vids... if you don't have a core position then any price is a good price to start.

but for those that can afford the luxury, don't go buying into the peaks

[addbball]

@stellaconcepts I understand what you are saying. I'm just afraid that a lot of people will misunderstand you.

[silverjunky999]

as always good video John cheers

[InTheSticks0001]

It was either March or May 27, 1980 that margin requirements were brutally raised to 100% instantly killing the price and the Hunt brothers. It's rumored that JPM is using it's stock as collateral and is naked short for the Fed. If JPM could default anyway, why not raise requirements? Who wants to bet against the Fed? I would own physical as my bet against the Fed. I learned years ago never to use margin, that's how the big boys can get to you. I sense desperation and danger here.

[GOLDSILVERDUDE]

Good video. Basically explains how in the short term their will be a lot of turbulence in the Silver markets, however long-term fundamentals suggest that Silver is still extremely undervalued.

[wizardofounce]

@GOLDSILVERDUDE

I would say the video was, to the layman, in depth and comprehensive.

Your comment, on the other hand, was basic/redundant.

[davincij15]

Banks know what the leverage is.

[BLynchCAN]

So the current push in silver is a leverage bulge and will reverse or could rewind?

[stellaconcepts]

@BLynchCAN what leverage can do on the way up, it can do on the way down.

[BLynchCAN]

@stellaconcepts If they bet on silver the wrong way -. Still, all they have to do is create a crumple in just one day.

But it would have to be big enough, like 10%. So they make on the selling of the silver at the top and then crash the market and make on the fall on the way down with cds's. Turn around and start the process with Gold. Beautiful, all on taxes paid in by the workers. They are using our own taxes to fleece us. Lovely, Fkn lovely.

[GuildF40]

Watch ya self :O)

[silvergoldhedge]

turn up the volume. Id like to hear what yre saying! Great vid. Thumbs up

[nld1960]

But, what will happen soon when the U.S. government will hit its debt ceiling of $14.29 trillion — and Congress fails to raise it?

[notpcone]

@nld1960 Don't fret, the idiots in Congress would never let that happen! The debt "ceiling" has no ceiling.

[stellaconcepts]

@nld1960 that would be bearish for silver.

[drewzillasaurusrex]

I favorited endless mountain's 600 year silver log chart. I haven't figured out how the producer of the chart determined that Silver was worth $800 US dollars an ounce in the year 1400 AD but we have over 300 years of manipulation to unwind with the price of Silver. The Au/Ag ratio stands out prominently out of balance. I'll keep buying until the ratio drops to 15:1 bide my time until it drops to 11 and then diversify a percentage of my Silver holdings into other metal. What about that?

[slhines7]

Low volume on my end?

[Hoepsakee]

Thanks for the vid John. There aren't many around explaining how it actually works and influences prices. The Rickards scenario will indeed "clean up" the market, only to start another wave. Cheers.

[MrAlkatraz1962]

He may not call it QE3, but the FED will continue the manipulation. Who's going to fill the 70% when the FED vacates the market? And at what interest rate? The increased interest rate will crush the economy. You say QE is going to end? I say it will not end but maybe will be called something else or behind the scenes. We will see. Thanks for your video.

[stellaconcepts]

@MrAlkatraz1962 i agree... but market perception is what drives the market (and leverage)

[MrAlkatraz1962]

@stellaconcepts ok understood

[xtop23]

What are the tax liabilities if I were to sell my physical prior to a possible dip then rebuy into the physical market? Are you liable for taxes on your profits or is there a way to avoid this I.E. a few weeks pass and you reinvest in physical at the lower price point and acquire additional ounces. Is there a time frame you must remain in to avoid taxes or is it unavoidable? ( assuming you don't sell privately and avoid taxes altogether.

[stellaconcepts]

@xtop23 talk with ur accountant... depends on your country, how long uve been holding and a few other things.

[tyronebiggums3]

@xtop23

Capital gains and deductible capital losses are reported on Form 1040, Schedule D.

Almost everything you own and use for personal purposes, pleasure, business or investment is a capital asset, including:

Your home, Household furnishings, Stocks or bonds, Coin or stamp collections, Gems and jewelry,

Gold, silver or any other metal, ...

Search irs.gov for capital gains reporting. And, of course, everyone will report their gains. hehe

BTW, Senate repealed 1099 tax rule last week.

[AgdrAgon999]

@ 10:34 you're saying don't BTFD? :( Heck, if I had the $ I'd be buying on every single one. lol

I see what you're saying but at the same time not everyone has a large core position like you do. So the more we're able to accumulate while it's still under $50/oz the better in my opinion because who knows how much longer it will remain at this still considerably low (inflation adjusted) price.

Remember, silver's 1980 high of $50 would equate to somewhere around $130 in todays dollars.

[stellaconcepts]

@AgdrAgon999 I wouldnt. I understand the long term picture... very well... doesn't mean I run out and buy the dip. I will be the dip that scares the bejesus out of everyone else.

[AgdrAgon999]

@stellaconcepts I understand, but for me the risk of not owning enough is greater than the risk of buying at these prices and watching it go down. I only have a small amount as it is and since I'm in debt the only way that I've been able to afford any at all has been to forgo unnecessary luxuries.

I just feel like the opportunity cost (of not having enough) is personally much greater than any loss that I might incur if I continued to buy at these prices or even higher.

Thank you, though!!

[creditliberation]

@AgdrAgon999 I see it going much higher than $130....in my opinion $130 is just the starting...

[terilooney]

Cool about Spotmex launch. Can you give me a very simple explanation why leveraging is legal? Sounds like a shell game to an uneducated ear. "Now you see it now you don't."

[JP5466]

Leverage is for professionals. Most only need to buy physical, then hold. 

When the PM paper markets crash, there will be a run on physical. When/if that happens, I will be backing up the truck.

[vince4782]

Silver went up because of deleveraging in my opinion. The banks used leverage to put downward pressure on silver especially. With Sprott taking delivery of more than 15 million ounces isn t it less leverage than before??? Sory for my bad english... I would like to know your opinion in that regards

thanks

[Zachary5489]

Lets hope it goes from 40 to 70 in the next 8 months!

[smasila]

@Zachary5489 Hold your horses...that's way too fast!

[Zachary5489]

@smasila X D  i know, but no harm in wishing!