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August 26, 2011 / Jeb

Time To Buy Silver?

Readers continue to express an abiding interest in silver, also known as the “poor man’s gold.” Prominent among the questions they raise: Quo vadis silver?

Recently the noble white metal experienced a rapid run-up to the halcyon heights of $50, only to retreat precipitously to the low $30s. This on-again, off-again action was due to a technical response to silver’s inherent volatility as both an industrial and a safe haven metal.

In order to quell such ebullient action, the Comex lowered the boom by a series of increasing margin requirements similar to what is occurring now in gold futures. I’ve written that such moves were in the cards with silver in late April, and gold more recently. Too much hot, speculative money was entering this market in late April (and early August in gold). Moreover, the big banks and hedge funds grew uncomfortable with their growing short interest positions. The actions of the Comex arrived just in time to save the day for the big fellows.

Read the full article by clicking here…

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