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CALL OFF YOUR DOGS WALT
Copyright November 2002 Charles Savoie
The line above comes from "Hunt The Man Down," an episode of "Have Gun
Will Travel" starring Richard Boone as the white knight (in black)
gunfighter Paladin, aired on February 7, 1959. The complete line he
recited was, "Call off your dogs Walt---don't make me hurt them to show
my size!" As you can guess, Paladin had his way and the bad guy's hired
hands backed down. This could be said in relation to the silver market
in a sense, telling the derivatives bad guys to call their dogs (naked
shorts and other items) off before they get hurt. But as we know,
someone will get caught short in the squeeze ahead. Someone's dogs, so
to speak, will get hurt when the silver market shows its size by way of
the law of supply and demand overwhelming the bad dog derivatives. Many
times dogs should have been called off before they got hurt---like the
five 125 pound plus Malamutes who were beat up by a 50 pound wolverine,
one of them having his jaw broken (The Literary Digest, August 20, 1932,
"A Hound of Hell Fights for his Life," page 23). According to Science
Digest, August 1972, "Meanest Animal in the World," page 64,
"Weighing only 50 pounds fully grown, the wolverine fights grizzly
bears, mountain lions, and armed men. Its strength and cunning are
legendary."
You could say the silver market is a wolverine about to show his fury;
or like Paladin, about to hurt the bad guys who made the sad mistake of
tangling with him. Butler made reference to "the usual group of
suspects" among the 8 or less largest traders having naked short silver
positions including JPMorganChase (the derivatives nightmare pirate
galleon corrupting the financial seas); Goldman Sachs; Bank of Nova
Scotia; American International Group and others to which you might add
Lehman Brothers, Citigroup and HSBC Bank, a British institution
originally known as Hong Kong & Shanghai Bank, sometimes alleged to have
roots deep in the opium trade for centuries. Considering what is likely
to happen in the nearing silver crisis, HSBC vaults are the last place
I'd want to have any 1,000 ounce bars stored for me---if you have any
there I suggest you arrange to remove them immediately. Trust them? You
can trust yourself more fully. Any insurance covering silver held there
likely has severe claims limitations spelled out in fine print. The rank
and file shareholders of these institutions will suffer badly, because,
so to speak, Walt didn't call off his dogs!
DERIVATIVES & SILVER AVAILABILITY
We've seen the horrifying display of derivatives holding silver prices
low in the face of a catastrophic deficit. The conclusion, reached by
such as Morgan and Butler years ago, and obvious to any thinking silver
market researcher, is that the only force that will move silver prices
sharply upwards, and on a sustained basis, is widespread unavailability
of silver. I recently made a phone survey of area gold and silver
dealers. Many had no ten-ounce bars, no one-ounce bars, and no
hundred-ounce bars. No one dealer had on hand the bullion assortment I
specified in only a small order---$1,000. What good does it do to price
something at $4.30 per unit if you can't get any at that price? What
will happen when 10,000 times as many people want to buy silver as are
currently buying? Did you hear the true story about the woman who
complained to the grocer about his hamburger being priced at $1.75 per
pound, and told him she could get it down the road for $1.50 per pound?
He told her, go down the road and get it for $1.50 per pound. Her reply
was, they were out of it. He told her, "Lady, when I'm out of hamburger,
I sell it for $1.25 per pound!" This is where derivative creators have
sent the world---to an environment of silver shortages. International
Forecaster recently commented, "silver is scarce and getting hard to
find." Millennium Bullion Fund, Toronto, says silver stocks will be
exhausted before 2003. Tulving Company, a large web based dealer,
stopped offering 1,000-ounce bars in late August. Their offerings of 40%
silver Kennedy halves are also suspended, apparently due to
unavailability. Other well-informed sources say the silver will run out
by midyear 2003, however one of these also notes the crisis could still
begin in 2002. And this at a time when short exposure has just been
reduced. The keys to this may lie in factors such as---will a run on
remaining silver occur? (It should!) While users like Kodak may face
softened blows because of silver byproduct contracts with base metal
producers, I have to wonder about other important users like American
Superconductor and Intermagnetics General. Also, is there a sizeable
silver stockpile remaining somewhere which is under negotiations for
leasing, and will the silver be leased or declined to be leased? If it
exists, but is not leasable, then the silver crisis cannot be postponed
for 5 to 7 months.
The metal manipulation has squeezed so much silver out of the woodwork;
the sponge is almost bone dry. In an authoritative article dated May 26,
1997 in Barron's entitled, "What Gives? Why don't silver prices rise?"
by Michael Santoli, CPM Group at that time estimated silver supplies as
covering the next three years deficits, while Goldfields estimated 4
years worth of deficit coverage. So, as of June 2001, we were going to
be out of silver, however as these metals think tanks have often
appeared to use "fuzzy math" in their estimates and calculations, we are
now about a year and a half beyond the deadline forecast in May 1997.
Derivatives have done their devil's work to guarantee years of shortages
ahead. If you attain to a consciousness as to how near we are to seeing
the silver Himalayas thrust skyward out of the flat plains of depressed
prices, you would consider every way possible of depriving yourself of
all comfort related expenditures and place that money into silver and
the right shares at once! Which brings us to the next topic---those who
slam mining shares versus physical, and those who do the reverse.
PHYSICAL SILVER VERSUS EQUITIES
I've read commentaries by metals dealers criticizing numismatic
investments, and I have to agree with them. Unless you're a real genius
at numismatics, you'll buy high and sell low even in the huge metals run
up approaching. Then these same dealers slam mining shares. People who
don't make money if you buy shares would seek to shake your confidence
in shares so they can enjoy some of your funds instead. We aren't
speaking of Bre-X scam companies, but the fine silver equities we know
about. Someone says, if you buy mining shares, you're just buying more
paper investments. But this is begging the question. These companies own
title deed to mineral rights, and surface rights, so what you have
fractional ownership of is extraordinarily valuable real estate. We also
hear, by buying physical silver, you actually have it in your
possession. However, as with mining shares, what do holders of this
physical silver expect to exchange it for? Why, for paper money, of
course, and in due time, far more than it cost going in. I have been
fortunate to take what are by my standards large profits in a silver
stock, at a time when this was not possible in physical silver due to
the dealer spread. Where did all the available physical silver come
from? From dealers? No---it came from mining companies! Physical silver
only advocates say---mining shares entail risks including
nationalization/expropriation (government theft). The same prospect
could occur with physical silver. An advantage of mining shares is---a
burglar or thief cannot take them from you, as he can take your physical
silver in a break in or hold up when you go to sell. You can minimize
mining share risk by avoiding companies operating in locations like
Indonesia, where 2 Americans were ambushed and killed en route to the
Grasberg copper-gold mine on August 31; then there's the nightclub blast
in Bali this October. Honestly, there are plusses and minuses with both
investments. In the event of need for barter or use of silver as money,
the physical holder has the lead over the pure equity owner. The mining
shares feature not only vertical, but also horizontal leverage---number
of ounces per share, so return on investment is superior. As far as
comparisons to other periods of rising silver prices with share and
bullion analysis---they may not all be valid, since we are entering a
different era---a time of real shortages unlike ever before. As soon as
silver skyrockets, millions of people will rush out to buy silver in
coin and bullion form, but will find availability severely constrained
and price quotes rising frequently. In this environment, they will also
stampede into mining shares. To cover the drawbacks of each type of
silver position, hold something in both. Concerning Butler's recent
salvo of criticism against some producing silver companies for remaining
silent in the face of COMEX chicanery, while his points are valid,
another observation can be made. As with those buying physical, miners
buying those greatly discounted ounces in the ground can negotiate lower
acquisition prices during the price manipulation. If miners take legal
steps to end it before it burns itself out, they end their low price
acquisition opportunity that much sooner---and could cost shareholders
the addition of a hundred million ounces or more.
Silver futures or options on the COMEX? You might make a big return if
you use double margin but why risk their sorry record of rule changes
when shorts aren't winning? The only way you might win there is by being
party to a class action lawsuit, then you wait for years during
litigation. There's still another type of individual in this
landscape---the sort who tries to shake your confidence in what you know
is a sound company so you'll buy his shares instead. Just be sure you
know the sound companies from the rest. One of many attributes I like
about the company I took a position in is, it spent a six figure sum
last year to have an independent review of its assets conducted by an
internationally respected mining consulting firm based in Denver. A word
of caution to silver shareholders---because of the lateness of the hour,
those of you who are traders may wish to join long term holders
also---you should consider suspending your trading to buy orders only,
because of the risk of being caught outside the move of the century.
Furthermore, I urge all shareholders of the right kind of companies to
hold for another reason---management needs your support. You don't want
to see the board ousted then replaced by one that will hedge all
production at 1% over break-even prices! Before the physical only
investor says, I just made their case---I don't see the boards being
replaced with hedgers. The word to all long shareholders is---I counsel
you to stop selling expecting to buy more on dips. The risk is great
that you won't have your shares when the ride starts. Barring a major
earthquake in silver before January, expect to see shares of a major
miner move up then due to announcements concerning 11.47 miles of recent
drilling.
WHAT CHARTS CANNOT DO!
Some comments about charts are in order. After admitting they have their
worthwhile uses, let's discuss what they can't do for you. They can't
tell you when a major event might upset the financial landscape---like
September 11, 2001, or when other events like that may transpire. They
can't tell you when silver leasing will end, will there be a run on
remaining supplies, or when a leading silver company will have a press
release announcing a major acquisition, merger, joint venture, or large
addition to its reserves by way of fire assayed drilling results from
exploratory areas. Many commodity brokers and analysts seem to rely near
100% on charts for their decisions, and if you bring up fundamentals,
they look at you like you just shot Kennedy---you're a heretic failing
to acknowledge their omniscient charts. They think as long as they have
a chart, they can predict silver prices, and since silver has been low
for so many years, they believe it will continue to stay low. You don't
even need any silver mining; you just need charts. The boys at the COMEX
will see that things don't ever go wild again! They know how heavily and
successfully silver has been shorted, so being long is totally out of
style. Brokerages also use charts, and research reports on some silver
miners speak of silver someday attaining to $5.25 to $6 per ounce. One
featured silver rising to $7. It seems the shortside conspiracy has
influenced many sources. An unknown day is marked on the calendar in the
near future to totally embarrass these chart worshippers, as leasing
ends and a buying panic sweeps the global silver market. Their charts
won't be fit for recycling into bathroom tissue. Predictions based on
charts have been published as to how silver could rise to around $15 per
ounce in December 2002. Whenever silver does start moving for real, that
$15 level will be swept away in the rocket launch upwards. If a chart
tells you silver's potential limit is $15, you probably also believe wet
streets cause rain. The day before silver goes berserk, many investors
will take short positions because their Ouija-board charts told them to,
then they'll howl like the neighborhood boy I knew who had a medical
emergency when he was stung on the eyeball by a red wasp! As David
Morgan remarked to me, "If there was three ounces of silver in the world
and the chart looked bad, people would go short!"
SILVER MISCELLANY, SENATOR ENRON & A BANKING "WARTHOG"
(Because someone else has a lock on the potpourri!) In the October essay
hosted here I forgot to mention a critical detail---now to be remedied!
If Arab interests are to be blamed for the coming silver shortages, so
too might the Chinese Reds. After all, they form the real backbone of
Bush's "Axis of Evil," North Korea, China and Iran. So maybe the Chinese
will also be accused of removing phantom silver from mythical London
stockpiles! A Kung Fu expert, I was told, could strike a victim in 7
places in the time it takes you to clap your hands, so maybe that's how
the Chinese could be alleged to be responsible, along with Arabs, for
the silver crisis, being fast operators. On the topic of highly placed
public officials and Wall Street connections, we note that as of October
2002 outgoing Texas Republican Senator Phil Gramm, "Senator Enron," will
become vice chairman of investment bank UBS Warthog---I meant to say,
UBS Warburg, as of January 2003. This is a subsidiary of Union Bank of
Switzerland, doubtless one of the Swiss banks mentioned by Butler as
having issued unbacked silver certificates representing more phantom
bullion. Its peer institutions are Swiss Bank Corporation and Credit
Suisse. My, what company we run with---the wife once headed the CFTC in
the earlier days of silver leasing and remained silent on the matter,
the husband lobbied to have Enron's energy derivatives unregulated, and
the public took another body blow from the elitists. And what elitists
we have here in the name Warburg, intermarried with the more famous
Rothschilds and with them and others key figures in the Anglo-American
network I mentioned last month. Paul Warburg was a pivotal figure behind
the creation of the Federal Reserve System in 1913. A more recent
Warburg, Sir Siegmund, was profiled in a Business Week article, November
23, 1974, pages 92-93 entitled, "A European Prefers Wall Street." It
said that Warburg, creator of the huge Eurobond market, "still runs the
bank from his home in Switzerland" and "counts among his friends some of
the most powerful men in the world." Public officials like Gramm and his
CFTC wife Wendy also ex of the Enron board, have no compunction about
pillaging the public then taking positions with their real bosses behind
the scenes; people like the Warburgs connected to the Federal Reserve
System and the Bank of England.
According to Stephen Birmingham in "Our Crowd," Harper & Row, 1967, page
209, the Warburgs took their name from a German city but originally came
from Italy, where their name was "del Banco," meaning, the bankers! As
we know, bankers are enemies of honest gold and silver money since they
cannot create it at will. However, not ignoring metals like silver, king
makers like the Rothschilds turn up by proxy on boards like that of the
leading silver company in the world (measured by share price), and
rumors are heard about George Soros fronting for them. This same company
attempted to acquire silver properties from "61 Neutron Corporation" (my
nickname for a leading silver company); this is a solid guarantee as to
the value of its shares! Interestingly, Max Warburg, Paul Warburg's
brother, was a member of the board of Hamburg-America Line in the
1930's, at a time when Birmingham said its position "became notably
Hitlerian" (page 394). Warburg interests are centered in the Union Bank
of Switzerland, a $700 billion institution, and in the City of London,
which uncoincidentally is at the center of 24-hour international banking
time. The December 1, 1945 Chicago Tribune, page 1, noted British
interests owned vast holdings in 80 large American corporations.
Evidently if you try to retake the colonies in the War of 1812 and fail,
you send someone over to establish a central bank 101 years later and
succeed financially where you failed militarily, then you use the junior
partner as your main muscle in wars to follow.
FLASHBACKS TO JULY 2002 & FEBRUARY 1950
In his 5-page letter of July 27, 2002, Michael Gorham of the CFTC made a
successful rebuttal of Butler's assertions concerning the silver
market---successful when read by a credulous simpleton. Gorham noted
that a conspiracy across multiple markets would be required to
manipulate silver. Apart from the fact that COMEX dominates the silver
price, the necessity for a conspiracy is quite factual. There is nothing
startling about this. It stems from greed, and greed and lust for power
are inseparable twins. The fact that so many big rich worldwide are
intermarried, including descendants of European and British royalty,
explains the situation. In America it is the "60 Families" which was the
subject of a book by Ferdinand Lundberg. International finance is
dominated by a wolf pack of intermarried, long established rich. Trends
in world finance and trading arenas are therefore a result of planning
behind the scenes, and are not the result of impersonal and haphazard
forces. The long term trashing of the silver price was planned and
implemented. These planned financial trends have been going on for
centuries. In his "House Divided" speech, Lincoln said---
"We cannot absolutely know that all these exact adaptations are the
result of preconcert. But when we see a lot of framed timbers, different
portions of which we know have been gotten out at different times and
places and by different workmen---Stephen, Franklin, Roger and James,
for instance---and when we see these timbers joined together, and see
they exactly make the frame of a house or a mill, all the tenons and
mortices exactly fitting, and all the lengths and proportions of the
different pieces exactly adapted to their respective places, and not a
piece too many or too few---not omitting even scaffolding---or, if a
single piece be lacking, we can see the place in the frame exactly
fitted and prepared to yet bring such a piece in---in such a case, we
find it impossible to not believe that Stephen and Franklin and Roger
and James all understood one another from the beginning, and all worked
upon a common plan or draft drawn up before the first lick was struck."
So here we see Senator Enron joining the Warburg faction of finance.
Please note that after launching the Federal Reserve Act, along with
Rockefeller relative Senator Nelson Aldrich (for whom Nelson Aldrich
Rockefeller was named), Paul Warburg declined Woodrow Wilson's offer to
be the first head of the Fed, but instead became president of the Bank
of Manhattan, which later merged with the Rockefeller led Chase National
Bank (named after Salmon P. Chase, an Ohio Governor and Senator who
became chief justice of the Supreme Court in 1864) to form Chase
Manhattan Bank, which more recently merged to become JPMorganChase,
seemingly the leading gold and silver manipulator. However UBS Warburg
is also big in metals. You should be alarmed to know the Warburg outlook
for the rest of us, shared by their fellow intermarried financiers (from
the Congressional Record, February 17, 1950)---
"We shall have world government whether or not you like it---conquest or
consent."
Thus spoke James Warburg, son of Paul Warburg, of this family who
"counts among their friends some of the most powerful men in the world,"
and Senator Gramm is joining them next January. I guess he already knows
Lord Roll of Ipsden, one of their main British executives.
Another public official pliable to the powers on a mission to eliminate
the middle class is Harvey Pitt, head of the Securities Exchange
Commission, who has taken much Congressional heat concerning lack of SEC
intervention in sham corporations like Enron and Global Crossing which
figured in the stock busts. The SEC, investigating key banks and
investment dealers including Goldman Sachs, was jeered again in October
as Harvey Pitt met with Goldman Sachs officials---who I suppose gave him
his operating orders. With appropriate anticipation we await the great
transition in silver prices, very positive for us, very bad for someone
who didn't call his derivatives dogs off!
Goldman "Sacks" the little guy,
He's for ripping off, lousy small fry,
Keep him poor till his day to die,
How did we fool him? With lie after lie!
SEC's Harvey Pitt sez he won't quit,
He doesn't care if small investors have a fit,
Goldman Sachs yawns as many take a terminal hit,
With their stocks---a rat's rump on a banana split!
Texas Senator Enron, Joining UBS Warthog,
His wife, like a poison Brazilian rainforest frog,
He, like a wily eye patch pirate sipping his grog,
Making small investors get lost in a fog!
Notorious string pullers at JPMorganChase,
Have $3500 in derivatives for everyone in the human race,
Trashing gold and silver for years, what a disgrace,
Their ruins will splatter all over the place!
Citigroup, Lehman Brothers and HSBC,
Are like disease killing a big tree,
As their derivatives die degree by degree,
Will their executives attempt to flee?
Stocks, bonds and currencies in a free fall,
String pullers hidden behind a tenebrous pall,
Claiming to be investigative, media has their gall,
Little people with their backs to the wall!
They always told us, gold and silver aren't cool,
But in this environment, precious metals rule,
The prostitute analyst looks more of a fool,
Who had better advice? Even a stupid old mule!
Banxter metal manipulator, what the hell are you?
Always prowling for someone to lay waste to,
More of a nasty demon, with each turn of the screw,
Beware! This time you ain't gonna breeze through!
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