Just because China is driving PM prices doesn't mean they go up in a straight line.. But you are right in that the paper shorts are heading for a shellacking.
Don't like the deflation concept — it's Keynesian rubbish. Banks will face enotrmous losses on their loans, mainly because a collapsing fiat currency leads to soaring interest rates. Talk to anyone in Argentina/Egypt/Turkey/Iran. The CRE problem is a subset in a wider crisis.
I just got the data on the Tuesday weekly close for the COT Report on COMEX positions. Silver shorts for the Big 8 Commercials increased by 7506 contracts. In Gold the Big 8 added 15649 shorts. These are large weekly additions, so how can we say that China aggregate demand is effectively driving the net physical price? If what you suggest is true the commercial boys on the COMEX are headed for a total shellacking!!!! What if we are facing major deflationary headwinds as the banks face major losses on real estate etc. could this not cause serious PM pricing softness in the short run?
Merrick—
Just because China is driving PM prices doesn't mean they go up in a straight line.. But you are right in that the paper shorts are heading for a shellacking.
Don't like the deflation concept — it's Keynesian rubbish. Banks will face enotrmous losses on their loans, mainly because a collapsing fiat currency leads to soaring interest rates. Talk to anyone in Argentina/Egypt/Turkey/Iran. The CRE problem is a subset in a wider crisis.
I just got the data on the Tuesday weekly close for the COT Report on COMEX positions. Silver shorts for the Big 8 Commercials increased by 7506 contracts. In Gold the Big 8 added 15649 shorts. These are large weekly additions, so how can we say that China aggregate demand is effectively driving the net physical price? If what you suggest is true the commercial boys on the COMEX are headed for a total shellacking!!!! What if we are facing major deflationary headwinds as the banks face major losses on real estate etc. could this not cause serious PM pricing softness in the short run?