In Ted Butler's Archive


The silver/gold price ratio has risen to 83 to 1. The relative price between silver and gold has been recorded for thousands of years. The all-time high on the silver/gold price ratio was around 100 to 1 and was seen twice in the last century, in 1991 and in the early 1930’s. In other words, over the scope of recorded civilization, silver has been this cheap relative to gold only a handful of times. Saying that this occurs once in a lifetime is an understatement because I’m talking about thousands of years.

Given the verifiable data, not only should silver not be priced this cheaply relative to gold, it should be the highest it has ever been in 5,000 years. That’s because there has never been less silver in existence relative to gold than there is today. Rarity and scarcity alone should be valuing silver higher.

Historical relative valuations filter out everything except one possibility – a manipulated price. If it could be shown that one of the prices being compared was artificially set, then it wouldn’t matter how much of each commodity existed. All that would matter would be identifying the mechanism creating the artificial price. That mechanism is silver futures contract positioning on the COMEX. I am more convinced than ever that once this latest rigging of silver prices runs its course, silver will shock to the upside, both on an absolute basis and relative to gold.

JPMorgan appears to be the largest short holder in COMEX silver futures, thus capping silver prices. Yet at the same time, JPM appears to be taking delivery of physical metal at the artificially depressed prices it has created. Could anything be more crooked? This is what they did all last year. If someone is looking for a motive for the silver manipulation, look no further than JPMorgan loading up on physical metal at artificially depressed prices.

Silver could, should and will go much higher in time, possibly even in the short term. When it explodes in price, the manipulation will be over, done, kaput. The drumbeat of evidence pointing to the grotesque fundamental undervaluation of silver is growing. One large entity is secretly acquiring huge quantities of physical silver. There’s not that much silver and that’s why they are grabbing up all they can. The price cannot be held down for much longer and when it breaks free the price will soar.

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