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« Silver Prices 17 January 2011 | Main | The Accumulator Trade 1 Update 11 January 2011 »

The Silver Market is really tight

John Embry of Sprott Asset Management.JPG
John Embry, Chief Investment Strategist at Sprott Asset Management

“The returns over the last 10 years, gold returned over 18% and silver close to 24% annually.  These are spectacular returns and we haven’t seen anything yet, we’re not even close to the third leg which is the blowoff.

As you know we started the Sprott Physical Silver Trust about 3 months ago.  We still haven’t got all of our silver in yet, we’re close, we’ve almost got every last bar.  But it’s taken the better part of 2 1/2 months to get it in, so the suggestion that this physical market is tight probably isn’t a strong enough suggestion, it’s really tight!”

The above is a snippet from King World News, to read this interview in full please click this link.

Retail buyers sometimes get frustrated at the length of time that it takes to get delivery of their order of silver bars but the above comes as a surprise as even the big boys are having difficulty too.

We imagined, quite incorrectly, that an organization the size of Sprott would have the 'clout' to get their order filled and filled quickly. If they have to wait the thick end of three months then that tells us that the demand for physical silver is outstripping the supply by a considerable margin.

When asked once again about tightness in the silver market Embry remarked, 

“There is infinitely more demand for physical silver than there is supply.  I mean all of this stuff coming out of the ground is long since spoken for by traditional industrial and medical uses and what have you.  And now with investor interest picking up, I just saw that on the 3rd of January there was 1.7 million silver coins sold in the United States which was equal to the amount that was sold in all of the month of December.  So, investment demand for silver is going off the chart, this could only mean dramatically higher prices.”

We have waited a long time for silver prices to take off and these comments suggest that we are getting closer by the day, so hold on to it as we are sure that one day soon it will be putting a sparkling smile on the face of all silver bugs.

And the final word from the man himself:

When asked about price targets for 2011 Embry replied, 

“I’d be disappointed if it didn’t trade through $2,000 this year, in that event if gold were to make a run at that, silver is a layup for $50.” 

Indeed, we can live with $50.00/oz silver prices, well for 2011 at least!

Over in the options trading pit, we now have 59 winners out of 61 trades, or a 96.72% success rate. If you have any questions regarding these trades please address them through their site where they will be handled quickly and I hope efficiently.

sk chart 10 Dec 2010.JPG

The above progress chart is being updated constantly. However, to see exactly how it is going, please click this link.

So, the question is: Are you going to make the decision to join us today, before we decide to cap membership.

Stay on your toes and have a good one.

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