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Silver Wheaton Corp. Message Board

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  • subprime_suicide subprime_suicide Aug 15, 2008 12:04 PM Flag


    "Many of the dealers above will buy paper futures to offset the silver that they sell. They don't take delivery, since the public never buys 1000 oz. bars from them. Instead, they use futures contracts to offset any losses. They intend to sell the futures for the cash to buy the physical silver "from the public" when it "comes in the door". Thus, they can sell physical product if they have it, even if they paid more for it, simply by buying futures contracts. So, it's not a case of them being unwilling to part with silver that they bought at higher prices. They make money on the immediate spread of the immediate buy and sell."

    Dealers are hedged... They don't lose money on their inventory when the price goes down. But nice try shortie.

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    • Have you even bothered to look at the Comex, Einstein? They are short at a margin of almost 3-1! Yes, they play this little game everytime the PMs tank {and sometimes, they have reasons for not buying when the prices are soaring}. There has been a sea change this time around. Deflation is begining to replace inflation. July was the high water mark for inflation, now withthe USD headed back above 80 on the index, you can kiss your PM "investments" goodbye. I have been following this trade since 2003, and I know a top when I see one. This trade {inflation} has played out. All downside from here....

13.12+0.53(+4.21%)Nov 30 4:03 PMEST