Best of the Week
Most Popular
1. Gold vs Cash in a Financial Crisis - Richard_Mills
2.Current Stock Market Rally Similarities To 1999 - Chris_Vermeulen
3.America See You On The Dark Side Of The Moon - Part2 - James_Quinn
4.Stock Market Trend Forecast Outlook for 2020 - Nadeem_Walayat
5.Who Said Stock Market Traders and Investor are Emotional Right Now? - Chris_Vermeulen
6.Gold Upswing and Lessons from Gold Tops - P_Radomski_CFA
7.Economic Tribulation is Coming, and Here is Why - Michael_Pento
8.What to Expect in Our Next Recession/Depression? - Raymond_Matison
9.The Fed Celebrates While Americans Drown in Financial Despair - John_Mauldin
10.Hi-yo Silver Away! - Richard_Mills
Last 7 days
Stock Market Correction Review - 26th Jan 20
The Wuhan Wipeout – Could It Happen? - 26th Jan 20
JOHNSON & JOHNSON (JNJ) Big Pharama AI Mega-trend Investing 2020 - 25th Jan 20
Experts See Opportunity in Ratios of Gold to Silver and Platinum - 25th Jan 20
Gold/Silver Ratio, SPX, Yield Curve and a Story to Tell - 25th Jan 20
Germany Starts War on Gold  - 25th Jan 20
Gold Mining Stocks Valuations - 25th Jan 20
Three Upside and One Downside Risk for Gold - 25th Jan 20
A Lesson About Gold – How Bullish Can It Be? - 24th Jan 20
Stock Market January 2018 Repeats in 2020 – Yikes! - 24th Jan 20
Gold Report from the Two Besieged Cities - 24th Jan 20
Stock Market Elliott Waves Trend Forecast 2020 - Video - 24th Jan 20
AMD Multi-cores vs INTEL Turbo Cores - Best Gaming CPUs 2020 - 3900x, 3950x, 9900K, or 9900KS - 24th Jan 20
Choosing the Best Garage Floor Containment Mats - 23rd Jan 20
Understanding the Benefits of Cannabis Tea - 23rd Jan 20
The Next Catalyst for Gold - 23rd Jan 20
5 Cyber-security considerations for 2020 - 23rd Jan 20
Car insurance: what the latest modifications could mean for your premiums - 23rd Jan 20
Junior Gold Mining Stocks Setting Up For Another Rally - 22nd Jan 20
Debt the Only 'Bubble' That Counts, Buy Gold and Silver! - 22nd Jan 20
AMAZON (AMZN) - Primary AI Tech Stock Investing 2020 and Beyond - Video - 21st Jan 20
What Do Fresh U.S. Economic Reports Imply for Gold? - 21st Jan 20
Corporate Earnings Setup Rally To Stock Market Peak - 21st Jan 20
Gold Price Trend Forecast 2020 - Part1 - 21st Jan 20
How to Write a Good Finance College Essay  - 21st Jan 20
Risks to Global Economy is Balanced: Stock Market upside limited short term - 20th Jan 20
How Digital Technology is Changing the Sports Betting Industry - 20th Jan 20
Is CEOs Reputation Management Essential? All You Must Know - 20th Jan 20
APPLE (AAPL) AI Tech Stocks Investing 2020 - 20th Jan 20
FOMO or FOPA or Au? - 20th Jan 20
Stock Market SP500 Kitchin Cycle Review - 20th Jan 20
Why Intel i7-4790k Devils Canyon CPU is STILL GOOD in 2020! - 20th Jan 20
Stock Market Final Thrust Review - 19th Jan 20
Gold Trade Usage & Price Effect - 19th Jan 20
Stock Market Trend Forecast 2020 - Trend Analysis - Video - 19th Jan 20
Stock Trade-of-the-Week: Dorchester Minerals (DMLP) - 19th Jan 20

Market Oracle FREE Newsletter

Nadeem Walayat Financial Markets Analysiis and Trend Forecasts

Your Silver Holdings are they Paper or Real ?

Commodities / Gold & Silver May 31, 2008 - 03:26 AM GMT

By: David_Morgan

Commodities In 2001 I was asked to write the "Ten Rules of Silver Investing" for the investing rules book published in Great Britain in 2001. The complete title of this book is The Global-Investor Book of Investing Rules -- Invaluable Advice from 150 Master Investors . My portion is available for free to anyone on the Internet willing to sign up here . In this week's article, let us examine Silver Investing Rule Number Six.


What's yours is yours - so keep it that way.

While it is wise to keep some of your silver where you can get to it easily, it is also important to keep the bulk of your metal in a safe place -- especially as your holdings increase. However, if you establish an account with a brokerage warehouse or other public storage facility, you should make sure your holdings are kept segregated and that you can inspect them when you wish.

Anyone who has studied the Silver-Investor.com Web site knows there is far more paper silver than real silver in the world. In last week's article, we discussed the fact that there is 100 times as much paper silver as there is actual metal. Certainly, I am not the only silver commentator pounding the table on this point, and we will look at a few more in this article.

In fact, my primary premise is that the real sustained move up in silver will not occur until the market recognizes this fact. You certainly can participate in alternative precious metals investments such as pool accounts or options, but remember, you are dealing in the paper world and should expect settlement in paper not in metal. I wish to be crystal clear: fully paid COMEX warehouse certificates held by you in your name do comprise real silver.

Many commentators have questioned various certificate programs from locations far and wide.

Ted Butler has described how there are maybe "billions of ounces of silver represented in bank certificate form that have no real metal backing." Ted goes on to state that bad things may happen to the owners and issuers of those unbacked silver certificates when the price of silver explodes. Butler mentions that banks all over the world, and in particular Swiss banks, have issued many of these silver certificates. Butler's conclusion is that you should, if you own silver in any questionable paper form, switch to an unquestioned form.

Jason Hommel has begun a dialogue with the Perth Mint on their certificate program and recently wrote to various agencies of the government of Western Australia. Hommel states in his open letter to these various government agencies, "You (Western Australian Government) may have a growing precious metals liability of over 880 million Australian dollars at the Perth Mint, which is backed by you, the government of Western Australia."

Hommel states he has received about 30-50 complaints about the Perth Mint over the last few months from investors who have tried to purchase silver bullion coins, kilo bars, 100-ounce bars, and 1,000-ounce bars and have had their orders refused or delayed. The way to de-leverage the whole system is to take real metal into your possession.

Be real, but get real to begin with. In other words, we have always advocated beginning a precious metals portfolio with the real metal first; once that is accomplished, if you wish to speculate further you can then branch out into other areas such as mining equities or other speculative situations.

By David Morgan,
Silver-Investor.com

Mr. Morgan has been published in The Herald Tribune , Futures magazine, The Gold Newsletter , Resource Consultants , Resource World , Investment Rarities , The Idaho Observer , Barron's , and The Wall Street Journal . Mr. Morgan does weekly Money, Metals and Mining Review for Kitco. He is hosted monthly on Financial Sense with Jim Puplava. Mr. Morgan was published in the Global Investor regarding Ten Rules of Silver Investing , which you can receive for free. His book Get the Skinny on Silver Investing is available on Amazon or the link provided. His private Internet-only newsletter, The Morgan Report , is $129.99 annually.

Contact information: silverguru22@hotmail.com , http://silver-investor.com

Disclaimer: The opinions expressed above are not intended to be taken as investment advice. It is to be taken as opinion only and I encourage you to complete your own due diligence when making an investment decision.

David Morgan Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules