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Investasi Favorit Saya untuk Dekade ke Depan (Bagian 4)

April 21st, 2013 No comments

“[I took] a moment to revalue the world’s above ground bullion inventory of silver and gold adjusted for the new prices.  World silver bullion inventory of one billion ounces is now worth $30 billion, whereas gold world bullion inventory of 3 billion ounces is now valued at $4,900 billion [$4.9 trillion].  All the gold in the world is worth 163 times more than all the world’s silver bullion is worth, even though silver is much more rare than gold.  I would suggest that is absurd and silver is destined to climb sharply in value, both on an absolute basis and relative to gold.”

– Silver analyst Ted Butler

Mengingat banyak hal-hal lain belakangan ini yang membutuhkan perhatian lebih khusus, maka saya akan mengakhiri pembahasan mengenai investasi favorit saya selama dekade mendatang di bagian ke-4 tulisan ini.

Tahukah Anda bahwa demand industri untuk perak mencapai 43% dari total demand-nya, serta industri sekaligus juga merupakan areal pertumbuhan demand terbesar untuk perak?  Porsi industri untuk komoditas perak ini memang mengalami pertumbuhan sekitar 2% per tahun.

Penting untuk memahami bahwa dalam hampir semua kasus, jumlah perak yang digunakan dalam ponsel, komputer laptop, otomotif, atau peralatan rumah tangga seperti microwave oven sangatlah kecil sehingga tidak akan didaur ulang. Untuk segala tujuan yang bersifat praktis, perak yang digunakan di dalamnya akan habis dipakai.

Jenis demand tersebut oleh ekonom diistilahkan sebagai “price-inelastic”. Jumlah kecil perak yang digunakan membuatnya menjadi faktor yang tidak signifikan bagi harga produknya. Selain itu juga, karena harga perak memiliki hubungan yang sangat minim dengan biaya produk jadi, maka perannya benar-benar tidak tergantikan.

Jika harga perak menembus ke atas level $100 per ons, maka satu-satunya pengganti yang mungkin untuk perak adalah palladium atau platinum, yang keduanya bernilai puluhan kali lipat di atas harga perak.

Selain itu, karena sebagian besar perak dihasilkan sebagai produk sampingan dari komoditas pertambangan terkemuka, seperti timah, seng, tembaga dan emas, maka hanya sedikit insentif bagi penambang logam dasar untuk meningkatkan produksi mereka karena perak yang dihasilkan tidak instrumental untuk bisnis mereka.

Juga perlu diingat bahwa semakin banyak investor membeli perak fisik dari tahun ke tahun. Namun mereka hanya sebagian kecil dari sedikit populasi investor. Meskipun pada tahun 2011 telah terjual 40 juta unit perak (Silver Eagles), namun dibandingkan dengan populasi AS perbandingannya hanya 1 koin untuk 8 orang warga AS.

Cadangan perak juga terbatas. Menurut data Geological Survey AS, secara waktu hanya tersisa beberapa tahun ini saja untuk menambang perak di AS, lebih pendek dari logam mulia lainnya termasuk emas. Oleh karena itu, penyerbuan besar investor ke perak belum terjadi!

Tampaknya masuk akal bahwa logam seperti perak, yang biasa ada di saku orang-orang untuk ongkos bus atau beli koran, entah bagaimana bisa mengubah dirinya menjadi hal yang langka. Namun kelangkaan ini nampaknya disebabkan oleh peran ganda perak yang unik.

Masuknya investor seketika ke pasar perak untuk mencari keuntungan dan pengguna industri yang ingin mencarinya untuk persediaan vital komponen manufaktur menyebabkan kelangkaan perak tersebut akan hampir pasti. Tidak ada cara produksi yang bisa mengimbangi demand ganda perak tersebut.

Andrew Hoffman, seorang konsultan perusahaan pertambangan, pimpinan di bagian Corporate Development, serta VP untuk sejumlah perusahaan tambang, dan saat ini juga tercatat sebagai direktur pemasaran untuk Miles Franklin, menulis sebuah artikel yang sangat menarik tentang topik ini dengan judul “Peak Silver?“:

“I spent a decade as an Energy analyst; or, more specifically, oilfield equipment, services, and drilling.  Thus, I was exposed to a tremendous amount of research on “peak oil;” which – shale oil notwithstanding – is yet to be proven either way.  Unfortunately, “peak” commodity studies cannot possibly incorporate ALL moving parts; nor foresee unexpected changes in demand, population, and technology trends.

That said, such studies can be extremely valuable – pointing out key hurdles to future production growth, and/or production cost.  That is, not only is “peak oil” a valid research topic, but “peak cheap oil.”

Heck, from the time I commenced my Energy career on the buy side in January 1996, until I left Salomon Smith Barney as a sell-side analyst in February 2005; the marginal cost of oil production stair-stepped higher; from levels to NEVER again be seen.  For nearly the entire duration of my 1996-2005 energy career, WTI Crude traded between $10/bbl and $35/bbl; not exceeding that high until late 2004; as compared to today’s recessionary price of nearly $100/bbl – and the 2008 peak of $150/bbl.  Thus, if anyone tells you “peak cheap oil” is not real, they are delusional.

Oh, by the way; when I left Salomon in February 2005, the Wall Street consensus for the “long-term” (3-5 years) oil price was… drum roll please… $18/bbl.  Why so low, you might ask?  TAR SANDS – which were hailed as a “sure thing” to swamp the market…

The reason I bring up “peak oil” is because “peak silver” is starting to be seriously debated; kicked off by the U.S. Geological Service’s ADMISSION (in the late 2000s) that silver is likely to be the first extinct element on the periodic table…

Silver will be the first element in the periodic table to become extinct

Sadly, my analyst skills have been dulled by a dumbed-down world in which little attention is paid to fact, correlation, and causation.  I appreciate the opportunity to perform research for this blog; but “precious” little quality PM research is both available and worth reading.

Thus, I was thrilled to come across Steve St. Angelo late last year; who writes under the moniker “SRSRocco,” published on the excellent Silver Doctors website.  He has very strong opinions about “peak oil” and “peak silver” (he believes in both); particularly what he views as wild assumptions about the ballyhooed shale oil boom.

Regarding the latter, it’s all about depletion and marginal production cost; of which fracking is terribly handicapped in both categories – per his calculation of EROI, or “Energy Returned on Investment” (the amount of energy required to produce an incremental barrel)…

N. Dakota Bakken Oil Boom Will End in a Bust, Just like ’49 Gold Rush

Mining, too, suffers from a dramatically declining EROI; indicating a significant increase in energy costs over time…

Peak Silver Revisited: Impacts of a Global Depression, Declining Ore Grades & a Falling EROI – Steve St. Angelo

Moreover, ore grades have plummeted; as the “low hanging fruit” has all been mined…

To wit; during the 1840s U.S. “gold rushes,” metal was typically visible (as in Placer formations).  Conversely, today’s mining operations target microscopic ore; as the “visible gold” was long-ago mined.  Thus, costly “open-pit” mines are the norm for both gold and silver; which are dramatically less efficient…

Care of the aforementioned issues, GLOBAL silver production has just marginally increased throughout the 12-year silver bull market – while prices have soared from $4/oz to a peak of $50/oz.  Astonishingly, GLOBAL silver production grew at just a 2.4% annual rate from 2000 through 2011 (the last year data is available); compared to a MASSIVE 19.5% CAGR for the silver price itself…

Consequently, the historic silver/gold production ratio– as in, centuries-old – has declined from 16:1 to nearly 9:1; with no signs of stabilizing.  A MAJOR reason for this plunge is that roughly 70% of silver production is by-product from base metal mines (principally lead/zinc); compared to gold, of which just 20% of production is by-product…

Throw in the fact that nearly all incremental production is CONSUMED by industry…

…and it’s no surprise that GLOBAL inventories are nearly exhausted…

Most credible silver analysts believe there is somewhere between 1.0 and 1.5 billion investable silver ounces above ground – that is, in bar or coin form; which, at today’s prices, is worth a measly $30-$45 billion.  And by the way, nearly all of that supply is sitting in private vaults – NEVER to see the light of day.

Thus, when the U.S. Mint RUNS OUT of supply – for the third time in four years…

US Mint Out Of Silver Coins – Suspends Sales

…and “ADMIRAL SPROTT” tells you silver sales are surging…

Eric Sprott: Why Are Investors Buying 50 Times More Physical Silver Than Gold?

…to the point they are nearly surpassing those of gold, by dollars spent…

…think LONG and HARD about where silver’s absolute price will go; let alone, the gold/silver ratio (given its centuries-old average is 16:1)…

Is “PEAK SILVER” here?  I don’t know, but Steve St. Angelo certainly believes so; particularly if the global economy is headed for a major recession…

Irrespective, I believe silver is the MOST UNDERVALUED ASSET of ALL TIME; and have ZERO doubt that whether “PEAK SILVER”: has been passed, “peak cheap silver” certainly has…”

What Do the Charts Say?

Setelah perak mengalami tekanan besar dari faktor teknikal, berikut adalah grafik terkini beserta komentarnya dari Dan Dontrose, yang merupakan editor pada The Fundamental View :

“As you can see in the silver chart, we lost key support at the $26.15 “shelf”.  Next areas of strong support lie at $22.50, $22, $20 and dare I say a retreat to where the upward parabolic move started at $17.50.  Whether it gets there is anyone’s guess but I can assure you if it does, yours truly will be heavy on the buy side.”

Grafik berikutnya secara eksklusif dari King World News (www.kingworldnews.com) dikirim oleh Kevin Wides dari Swiss, yang memprediksi bahwa arus dana keluar dari perak secara besar-besaran akan memicu akselerasi mengejutkan lebih dari 1000%:

“As the saying goes, a picture tells a thousand words. I have taken a monthly line chart on silver going back to 1970. The 1970’s bull market from a technical perspective is picture perfect. There are a clear 5 waves up (as seen on the chart below), with the largest being the 5th wave which represented a staggering 808% gain for silver.

This is the norm for commodities as wave 5 is driven by fear and scarcity. The 70’s corrective waves of 2 and 4 have alternation, where 2 is fast and steep, and 4 is slow, drawn-out and volatile. The subsequent 20 year bear market made obvious key levels of support and resistance as noted by the yellow circles and horizontal red lines that I have extended into today’s time frame….

Moving to the current bull market, I prefer to think it started in 2003 as this is close to the absolute low, and it is also where the price really started to move higher. I have noted the key breakout levels, the first being at $8.39, and the second at $20.22. These levels correlate perfectly with obvious resistance established in the prior 20 year bear market. Both levels were broken to the upside, but only after the second attempt (clearly seen on the graph).

The latest resistance tested, with a slight false break, was in April of 2011 at the monthly closing level of $48. The previous all-time monthly closing high was on Jan 31st, 1980 at $38.53 (although the intraday high was slightly above $50). This price pattern indicates that the silver price should move significantly higher on the next sustained break above the $38.50 to $40 zone.

Today’s fundamentals for fear and scarcity that drives a commodities wave 5 rally are lining up perfectly. We are seeing the move to reject and outright fear in some cases of fiat currencies, to the low supply and shortages of physical silver. Within the shortages of supply that exists because of natural demand lies the insidious excessive paper shorts. Fear will be fueled exponentially by those speculators caught short.

From my analysis, breakout two at $20.22 was the most significant. It was the first resistance tested in the bear market since October 1980.

Regarding silver’s breakout of a major concave price base of 23 years, as the saying goes in technical analysis, ‘The larger the base, the higher the move into space.’ The minimum topside target for silver is around $200 which is the top of the major price channel.”

Dan terakhir di bawah ini adalah hal menarik bagi para pecinta perak dari Nick Laird, yang berjudul Gold/Silver Ratio: Future Potential Ratios:

Catatan pribadi: Jika emas naik, maka perak akan naik lebih jauh karena alasan sederhana yakni dalam sentimen bullish logam mulia yang berlanjut, rasio emas/perak cenderung turun.

Secara historis, rasionya telah mengalami tekanan terendah antara 10 hingga 15 banding 1. Saat ini rasionya sedang berada lebih dari 50. Akibatnya perak memiliki banyak peluang untuk naik. Misalnya, $2500 atau $3000 potensi kenaikan emas bisa mendorong kenaikan perak hingga $250 – lebih dari 10 kali lipat dari harganya saat ini.

Dibuat Tanggal 18 April 2013

Categories: Pasar Internasional Tags:

Investasi Favorit Saya untuk Dekade ke Depan (Bagian 3)

April 18th, 2013 No comments

“Clearly, there is no total valuation concern in silver.  If anything, the current near microscopic total valuation of all the world’s silver bullion argues that something is amiss.  Even if silver tripled in price while gold’s price remained unchanged, the entire world’s silver bullion (1,000 oz. bars) would still be worth only one percent of all the gold in the world.  I think the relative total valuation benchmarks not only favor silver compared to gold, but also suggest that any future price bubble will most likely appear in silver rather than gold.”

– Silver analyst Ted Butler…30 January 2013

“I’ve heard lots of information from people that are in the coin business that there’s almost equal interest in silver as gold in dollar terms.  How can the price be 50:1 when the demand is 1:1?  That can’t carry on.”

– Eric Sprott, CEO, Sprott Asset Management

Diperkirakan lebih dari 90% dari semua hasil tambang perak yang pernah ada dikonsumsi oleh industri fotografi, teknologi, medis, pertahanan dan industri elektronik global.

Pada tahun 1900 tercatat ada 12 miliar ons perak di dunia. Dan di tahun 1990, angka itu telah turun menjadi sekitar 2,2 miliar ons, demikian menurut perusahaan riset komoditas CPM Group. Dan saat ini, hanya ada kurang dari 1 miliar ons perak murni hasil tambang.

Bahkan diproyeksikan penyusutan akan lebih besar ke depannya. Permintaan industri hampir selalu melampaui pasokan pertambangan selama 20 tahun terakhir. Hal ini memang belum mendorong kenaikan harga yang lebih jauh karena dunia masih mampu ‘mengisi kesenjangan’ antara persediaan dan stok resmi pemerintah.

Namun, saat ini persediaan pemerintah AS hampir habis, dan penjualan dari sumber-sumber seperti China, Rusia dan India juga menurun. Saham-saham perak mendekati rekor terendah mereka. Dan yang tak kalah penting, perak akan jarang ditemui karena pasokan yang tidak elastis.

Permintaan industri bersama dengan melonjaknya permintaan investasi, telah menyebabkan penundaan pasokan seperti yang sekarang sedang dialami oleh sejumlah pengelola dana di komoditas perak.

Salah satu tema Ted Butler adalah bahwa pengguna industri akan panik jika mengalami kesulitan mendapatkan perak. Dan ini akan mendorong kenaikan harga yang cepat. Dan di saat itu pulalah semakin banyak investor yang mengalir dananya ke perak karena melihat pergerakan harga yang cepat.

Faktor bullish lainnya termasuk adanya berbagai kegunaan baru industri untuk perak, kesulitan dalam peningkatan produksi pertambangan perak, permintaan Asia yang luar biasa serta jumlah perak yang tidak ada dalam pool accounts yang harus di-cover suatu saat nanti.

Lalu ada kemungkinan inflasi, krisis dolar atau kepanikan ekonomi yang menyebabkan penyerbuan ke dalam logam mulia.

Dan seperti yang dijanjikan, berikut adalah bagian kedua dari laporan Steve St Angelo tentang kekuatan yang akan mendorong perak lebih dari $ 100. Bacalah dengan seksama dan bertindak sesuai:

Will Higher Silver Prices Bring On More Future Mine Supply?

There is this economic principle that states increased demand and higher prices of a commodity or product will eventually bring more supply to the market. While this has normally been the case during the history of mankind, the world will soon be hit by a rude awakening.

Gold and silver mining is extremely energy intensive. Back in the good ‘ole days (late 1800′s & early 1900′s), the majority of energy used in mining was human and animal labor. This somewhat primitive method of extracting the precious metals from the ground worked fine as the ore grades were extremely rich and confined to narrow veins.

But, as the best quality mines were played out and the average ore grades started to decline across the world, more energy was needed to mine and process the ore.

The mining industry solved this problem by building bigger machines that could move larger amounts of ore to compensate for the declining ore grades. Eventually, animal and human labor was replaced by earth moving machines. For a while, bigger accomplished the job until the mining industry demanded… GARGANTUAN.

Caterpillar met this challenge by designing and building the Model 797F Haul Truck — one of the largest mining haul trucks on the planet:

The 797F is the epitome of massive on all scales. It is nearly 50 feet long and can haul 400 tons of ore (800,000 lbs). The tires specifically designed for the 797F, are 13 feet tall and cost $42,500 a piece. The 797F is so large, it takes 12 semi tractor trailers to ship the truck to the mining site for final assembly. Included in the list of parts is its tiny 1,000 gallon fuel tank.

Here’s the good part. The Caterpillar 797F is so large, it averages 0.3 mpg and consumes roughly 65 gallons of diesel per hour. Because of its huge cost, the 797F is normally run 24 hours a day, 365 days a year, stopping only for scheduled maintenance. If we calculate its annual fuel consumption based on conservative figures, the 797F can burn nearly a half a million gallons of diesel a year.

Again, the reason why the mining industry transitioned its machines from bigger to gargantuan was to offset the decline of ore grades that went from very rich to extremely poor. Before I tie together the future energy picture and its impact on silver mine supply, let’s look at some actual data on declining ore grades in the top silver miners.

Putting Actual Data Behind The Decline Of Ore Grades At The Top Silver Miners

In all my research on the Internet, I have yet to come across an individual or publication that has provided the public with actual data on the overall decline of the average ore grade (and yields) in the silver industry… well that is, up until now.

When I gathered the data to produce the chart below, I had no idea of what the final outcome would be. However, as I tallied the final figures, I was completely surprised by the results:

For the sake of clarity, an ore grade is the amount of silver contained in the ore before mining. The average yield is the actual amount of silver the company produces when it processes a tonne of ore.

Here we can see that in just six years, the top silver miners’ average yield has declined 34% or 5.6% per annum. In 2005, the top 6 silver miners produced on average 13 ounces of silver per tonne of processed ore, but by 2011 their average yield dropped to only 8.6 oz per tonne.

Moreover, in 2005, the top 6 silver miners produced 123 million oz of silver by processing 9.4 million tonnes of ore, but just six years later they had to process 15 million tonnes of ore to generate 129 million oz of silver. Subsequently, the net result was a mere 5% addition of silver production with a 60% increase of processed ore.

RULE OF THUMB: As ore grades or silver yields decline, it takes more energy to produce the same or less metal.

The mining companies included in the calculation above were Fresnillo, BHP Billiton’s Cannington mine, Pan American Silver, Hochschild, Polymetal and Hecla. Some of these silver miners were chosen over other companies who had higher annual silver production due to the availability of data as well as consistency of its reported annual silver yields.

I omitted Coeur d’Alene because its annual silver yields were all over the place due to new mines be added and old mines dropping off throughout the years in which I collected the data stream. Truth be told, Coeur’s average silver yield in 2011 was only 4.2 oz per tonne. In that regard, the addition of Coeur’s silver yield data into the mix would have made the overall yield even lower.

Furthermore, the companies and the one individual mine (Cannington) were chosen as they are primary silver mines. The authors of the annual World Silver Survey did not include Hochschild or Polymetal in their example of primary silver miners, although I included them due to several reasons.

According to the Silver Institute-2012 World Silver Survey, Fresnillo is listed as one of the largest primary silver miners in the world. However, in its first half 2012 report, Fresnillo received 51% of its revenue from gold and 45% from silver. Hence, Fresnillo is actually making more revenue from mining gold rather than silver.

On the other hand, in Hochschild’s first half 2012 report, the company received 70% of its total revenue from silver and only 30% from gold. In my book, Hochschild is more a primary silver miner than is Fresnillo.

Polymetal was also selected due to the fact that its two primary silver mines, Dukat and Lunnoye produced 17 million oz of silver at an average yield of 9.8 oz per tonne in 2011. Furthermore, Polymetal’s first half revenue was split equally at 48% each from gold and silver. So, in reality, Hochschild and Polymetal are just as much a primary silver producer as is Fresnillo.

I only included data from primary silver mines in the companies listed above. Even if a company received additional silver production from one of its primary gold mines, I elected not to include these figures as it would have skewed the results in determining the true decline rate of yields in the primary silver mining industry.

Lastly, there is this practice in the mining industry to process lower grade ores as the price of the metal increases. Some mines actually put a mark locating the lower grade ore within the project for the miners to remove during the year. Furthermore, mines will process lower grade ores and tailings that they neglected to do in the past when prices were lower. However, this does not really alter the overall average annual decline of yields in the silver mining industry shown in the chart above.

For example, both the Fresnillo and Cannington mines have seen substantial declines in their average silver yields in the past six years. This was not due to mining and processing lower grade ore to take advantage of higher metals prices, rather it was due to the mine being played out and finally reaching the reserve base ore grade stated in their production reports.

Silver = Stored Energy

One factor that most precious metal investors fail to comprehend is the energy nature of silver as a store of value. Of course they understand that silver and gold are real money, worth a certain amount of perceived or intrinsic value. Unfortunately, they fail to realize that the most important value attached to an ounce of silver, is the stored energy contained in each coin.

A monetary value was attributed to an ounce of silver or gold based upon the amount of energy and capital it took to mine the metals as well as its degree of rarity. During the Roman times when silver was mined by human and animal labor, the monetary value was given based upon the amount of labor (energy) it took to produce a one ounce coin. Basically, the free market determined the prices of goods and services in silver coin to their relative energy value.

For example, if it took on average four hours of labor to produce an ounce of silver during the Roman Empire, that coin was exchanged for a good or service of equal energy value. In this example, a city laborer working a twelve hour work day might receive 3 silver coins as pay. I realize I am making a basic assumption here, but this is how a monetary value was given to gold and silver. Of course, the free market would determine the value of an egg, chicken, horse or say a cow in gold or silver coin. But, in the end, the more energy that went into producing a good or service, the more silver or gold coins it took to equal the energy transaction.

Once an investor realizes this energy value as it pertains to silver (or gold), you will then understand how important energy plays as a role in the production of the metal as well as its role in the overall economy. Thus, as the energy supply of a society increases, so will its production of gold and silver as money (if the society uses precious metals as money). On the other hand, as the society experiences a decline in its energy supply, so will the mine supply of its gold and silver.

The mining industry has been banking on the continued growth of the global liquid energy supply to be able to increase the production of gold and silver. With the knowledge that the peak of conventional oil production is now upon us, new hope has been placed on the supposed SHALE ENERGY PARADIGM to be the U.S. and world energy savior.

How The Shale Energy Boom Will Turn Into A Huge Bust

As I mentioned before in my article WHY IS THE FUTURE SUPPLY OF SILVER MORE AT RISK THAN GOLD, the world has been watching closely the new shale energy boom taking place in the United States. Why? If the United States shale energy model proves successful, then the rest of the world believes they will be able to recreate the same results in their respective countries.

It is due to this very reason the Shale Oil & Gas Industry have spent a great deal of time and money pumping out a positive PR campaign to convince the U.S. public and the world that shale energy is indeed our next energy savior. They state that shale oil and gas can supply the United States (and the world) with cheap energy for the next several decades.

While it is true that production volumes in both shale gas & oil have risen quite substantially in the U.S. over the past few years, there seems to be a dark side of the equation that the industry would like to keep a secret.

In his article IS SHALE OIL PRODUCTION FROM THE BAKKEN HEADED FOR A RUN WITH THE RED QUEEN?, Rune Likvern presented this chart on the monthly net additions of producing oil wells in the Bakken:

The month over month change of reported wells are shown by the blue bars. Here we can see that from early 2006 to the end of 2008, additions of a modest number of shale wells allowed the overall production per well to increase significantly (shown by the black line). Nevertheless, since 2008, the rapid increase of monthly net additions of new shale wells has masked the high depletion rates while allowing only a modest increase of overall production from the Bakken.

According to Rune Likvern:

The wells normally have a high production at start up that rapidly enters into steep declines.

To facilitate growth in total production an accelerating number of wells needs to be brought into production.

To sustain a plateau requires a continual addition of a high number of producing wells.

Basically, the shale oil players have to run faster and faster just to stay in the same place. This practice has allowed the increase of oil production from the Bakken Field in North Dakota, but it has done so at a huge cost.

In another chart developed by Likvern (including my annotations), we can see the estimated cumulative net cash flows for shale oil in the Bakken:

The chart reveals the ugly truth that the shale oil operations have accumulated an estimated $14 billion in negative cash flow since January of 2009. Here we can see that shale oil players in the Bakken have seen an accelerated need for additional sources of capital not provided by their operations alone. How long can they continue this losing battle?

The big energy companies such as Exxon-Mobil, Conoco-Phillips and Chevron-Texaco are cash cows. They are so cash rich, they have been taking a portion of their positive cash flow and buying back their stock. So, why are these shale energy companies either suffering from negative cash flows or are being loaded down with huge amounts of debt? Could it be that the shale oil is not really what it has been hyped up to be?

To offer a fair and balanced analysis of shale energy, I have to provide a few bullet points on wonders of shale gas. If you think the information coming from the North Dakota Bakken Field is disappointing, the data being released about the shale gas industry is even worse.

Some Pearls Coming From the Shale Gas Industry

1) The USGS recently announced massive downgrades of U.S. shale gas reserves

2) Break-even price for typical shale gas player (over the life of the well) is at least $6-7 mmbtu. With the current price of natural gas at $3.50 mmbtu… we can only imagine the hemorrhaging taking place on their balance sheets.

3) Geologists at Labyrinth Consulting have examined 9,100 of the 15,000 wells in the Barnett shale play using production data filed by the operators with the Texas Railroad Commission and found that less than 6% actually met minimum economic thresholds.

4) Forecasted revenues to land owners were a mere fraction of what was promised:

a) The wells at DFW airport have come in with dismal returns. (8) They never performed up to original projections. Chesapeake Energy needed 2.0/Bcf to break even. The wells have produced .9/Bcf .

b) The University of Texas at Arlington saw revenues peak at approximately $7M with a mere 6 wells on campus to plummet drastically in a matter of months. Revenues in 2010 were down to $800K even though there were now 22 wells on campus.

5) To acquire additional capital to continue the shale gas treadmill, companies drilled a few wells to prove up new large reserves. They took these supposed reserves and pawned them off on larger companies such as BHP Billiton, Encana and BG Group.

6) In 2012, the shale gas party ended when in the first half of the year, over $8 billion dollars of impairment charges of shale gas investments were written of the balance sheets of major oil and gas companies. BHP Billiton won the grand prize by suffering a $2.5 billion impairment write down from its initial $4.75 billion shale gas investment it purchased from Chesapeake the prior year.

7) Wall Street firms have made a killing putting together these sort of lousy energy deals. Without Wall Street, the Shale Gas Treadmill would not have the means to continue.

(information from [2] Art Berman, [3-4] Deborah Rogers at the EnergyPolicyFourm.com)

If we have an open mind and are able to process the basic information on shale oil & gas provided above, we should come to the conclusion that shale energy will not be the savior of our future energy needs. It may provide additional energy production for a brief period of time, but it is not a viable long term energy source.

Quick Wrap Up & Connecting The Dots…

Investment demand has been and will continue to be the driving force behind the rising price of silver. Analysts who point to the growing so-called annual surplus of silver as a negative factor, have been brain-dead since 2004… the year both the surpluses began as well as the time when the price finally broke above its decade level in the $4-5 range.

One area that denotes increased investment demand is “official coins” produced by government mints. In just nine years, official coin demand has increased 274% from 31.6 million oz in 2002 to 118.2 million oz in 2011. Even though China is currently ranked as the fifth country in official coin production, they plan on making their Silver Panda as popular as the American Silver Eagle. To do so, they may set a goal to increase their mintage of their Silver Panda to over 50 million annually.

According to the data provided by the 2012 World Silver Survey, total global silver investment demand has risen from only 31.6 million oz in 2002 to a staggering 282.2 million oz in 2011. As world economic fiat based monetary system continues to deteriorate, investors are taking delivery of physical silver rather than holding on paper contracts that may not be backed by any metal whatsoever.

This has created a run on the LBMA bank… the largest metal exchange in the world. Evidence of this can be seen by the huge increase of U.S. silver bullion exports to the United Kingdom. In 2011, the U.S exported a mere 19 metric tonnes to London. However, in just four months (May-Aug), the U.S. has exported 291 metric tonnes to the LBMA vaults in the U.K..

The top 6 silver miners in the world have seen their average yield decline 34% in six years from 13 oz per tonne in 2005 to only 8.6 oz/t in 2011. As ore grades and yields decline, it takes more energy to produce the same or less silver.

Metal analysts are forecasting continued growth of annual silver production for the next decade and beyond. To be able to grow silver metal production, the world will have to grow its liquid energy supply.

As the world is beginning to wake up to the fact that conventional oil production is peaking (or has already), shale gas & oil have been touted to be the new energy savior to keep business as usual going for several more decades.

Production statistics and financial data coming out of the Bakken oil field and the shale gas industry are quite depressing to say the least. While the big energy companies are cash cows, the shale energy players are experiencing large negative cash flows or are saddled with debt. The hyped Shale Energy Boom will more than likely turn out to be a Huge Bust.

Once the world ‘s liquid energy supply starts its inevitable decline from its current plateau, annual silver metal production will decline as well (or may follow soon thereafter). Metal analysts who are forecasting a glut of silver coming onto the market in the following years are also suffering from the inability to process information correctly. There will be no silver glut and there will be no silver available when the world’s fiat monetary system finally dries up and blows away.

Get ready. As the forces for pushing silver over $100 have just begun.

Comments are always welcome and can be sent to SRSrocco @ gmail.com

What Do the Charts Say?

Agar kita selalu melihat secara menyeluruh, berikut adalah suatu perpektif historis dari sebuah koreksi harga logam mulia dari Michael Kilbach, seorang President sekaligus Editor pada www.investmentscore.com:

“When trying to determine when a market correction may be ending, it only makes sense to look at past corrections to help determine a general guideline. This really does not have to be a complicated process and the results from some quick analysis can be quite helpful.

We believe that Silver is in its fourth intermediate term bull market correction and we would like to see how it measures up to the other three.

The above chart helps us compare the percentage drop from the top of each correction to their lows. This is remarkably helpful as it gives us a general idea of what may be considered “normal” for a silver bull market pullback.

As we know, in 2008 the extreme circumstances of the Credit Crunch really helped push down all markets. The lack of credit to consumers, investors and institutions caused the volatile silver market to fall an impressive 55% from peak to trough. Amazingly this massive correction did not end this impressive bull market up trend. If a 55% correction is not the “maximum” percentage drop that we should expect from a bull market correction, it should be somewhere close. This 55% Aggressive and 41% Average percentage correction for this bull market is a helpful guideline to compare our current low of 46% to.

But how long do these bull market corrections typically last?

In the above chart we can see how many days the current correction in the price of silver has lasted compared to past intermediate term pullbacks. The point at which a correction ends can be a little subjective as one may be inclined to pick the extreme low of the correction or when a new high is reached etc. For our analysis we picked the best buying opportunity just prior to the following uptrend. We can see above that the current correction is getting a little “long in the tooth” compared to other intermediate term pullbacks in the current bull market.

In terms of depth and duration it appears that the current intermediate term correction is closer to an end than a start. Note that we said “closer” and not “at”. These types of comparisons are only guidelines and assume that the bull market itself is not over.

Of course the price of silver can correct further, it can last longer and it may never go back up. However, our proprietary long term charts and other indicators lead us to believe the long term bull market is well intact and we find these kinds of charts both helpful and bullish.

If you found this editorial interesting you may want to sign up for our free newsletter and learn more about our service at www.investmentscore.com.”

Seperti biasa saya lampirkan sebuah gambar lucu lagi di akhir tulisan ini. Semoga Anda beruntung dan sehat selalu:

Dibuat Tanggal 17 April 2013

Categories: Pasar Internasional Tags:

Investasi Favorit Saya untuk Dekade ke Depan (Bagian 2)

April 17th, 2013 No comments

“Based on the evidence that we all see of the massive amount of silver buying, vis-à-vis gold, where people are almost putting as many dollars into silver as putting into gold, but the price is, you know, 50 times different, but the same amount of money is going in, and the availability for investment is in a ratio of about – there’s 20 times more gold in dollars to buy than there is in silver dollars to buy for investment, yet the money is going at 1:1.  Well, I know as kind of a mathematician or logician that cannot carry on.  Something’s going to give here, so that’s why I think that silver price in the next decade will do better.  Well, if they back currencies with gold, you need a monetary item that is in smaller quantities, which has to be silver, and can you imagine the physical demand for silver if we had to reintroduce silver as a currency?  It would be unbelievable, so I think that’s another more macro, long-term thing that would suggest that in this decade should we ultimately collapse the financial system and say, “We’ve got to back the currency with something real,” that then silver would have value.”

– Eric Sprott, CEO, Sprott Asset Management

Masalah utama dengan uang modern adalah bukan merupakan tempat penyimpan nilai (store of value). Sejak berdirinya Federal Reserve System, mata uang “dolar” kini nilainya sudah berkurang hingga di bawah nilai nikel. Hanya ada 2 aset yang merupakan uang, dan tidak bergantung pada kredit, yakni perak dan emas.

Apa yang akan terjadi jika orang kehilangan kepercayaan terhadap dolar AS dan aset kertas lainnya? Bahkan suatu peristiwa kecil di dunia bisa memiliki dampak besar pada harga perak. Perak sungguh merupakan pasar yang sangat kecil sekali, tapi memiliki satu potensi besar.

Karena perak adalah pasar yang relatif kecil, dan harganya jauh lebih terjangkau oleh masyarakat daripada emas, permintaan moneter yang baru akan memaksa harga perak bergerak ke ketinggian mengejutkan dengan standar saat ini.

Lebih khusus lagi, meskipun ada sesuatu pada order emas senilai $3,7 trilyun, untuk perak hanya sekitar $20 milyar saja. Selain itu, saat ini produksi perak baru merosot jauh lebih rendah dari permintaannya.

Oleh karena itu, setiap peningkatan yang signifikan dalam minat investor terhadap perak akan memiliki dampak yang dramatis karena pasar perak hanya kurang 1 persen dari pasar emas dalam denominasi dolar AS yang bernilai $4 triliun!

Jika itu soalnya, lalu mengapa harga perak turun begitu banyak meskipun permintaan fisik kuat? Salah satu alasan utama adalah keterputusan hubungan yang jauh antara perak di pasar fisik dan non fisik.

Artikel berikut, yang dirilis pada Gold Silver Worlds pada tanggal 2 April, membuktikan bagaimana perak di pasar non-fisik (yakni pasar berjangka) mampu untuk menahan harga perak meskipun terjadi kekuatan yang luar biasa di pasar perak fisik.

Kuartal pertama tahun 2013 mengungkapkan keterputusan hubungan yang jauh tersebut berdasarkan data umum yang tersedia. Selain itu, pakar perak Ted Butler menghitung konsentrasi historis untuk posisi jual oleh JP Morgan yang memungkinkan pihaknya untuk mengontrol harga perak:

“Silver started the first quarter at $30.45 per ounce (Jan 2nd 2013) and closed more than $2 lower at $28.30 per ounce (March 29th). During the same time period, investment demand for physical silver was historically strong and all data pointed to accumulation by investors. This evolution asks for an explanation; the answer lies in the paper silver market.

Physical silver (bullish): investors have accumulated at a record pace

In order to get an idea of the physical silver market, we use (1) the physical holdings of all silver ETF’s combined together with (2) US Mint sales of Silver Eagles. Those are leading indicators when it comes to investment demand for physical silver.

(1) The US Mint has sold a record amount of US Eagles when compared to the first quarter of all previous years (also described here in detail).

14.2 mio ounces (equaling 457.2 tonnes) of US Silver Eagles sold

(2) All silver ETF’s combined increased their physical holdings by some 4.0% (also described here, based on Standard Bank Research)

Physical accumulation of 26 mio ounces (equaling 800 tonnes) in all silver ETF’s

Total silver holdings at the end of the quarter stood at 655.8 mio ounces (equaling 20,400 tonnes)

To put these figures into perspective, one should remember that total mine supply in 2011 was 761.6 mio ounces (equaling 24,485 tonnes).

The key message that the physical silver market is signaling is one of EXCEPTIONAL STRENGTH. One should note that this trend is occurring particularly in silver; gold is not showing the same strength in physical investment demand. Given these facts, how is it possible that the silver price has moved down in the first quarter? The next paragraphs reveal the answer.

Paper silver (bearish): futures positions have held the silver price down

The paper silver market refers primarily to the futures market in which large traders (hedge funds, large commercial banks, bullion banks, etc) hold long or short positions. Silver expert Ted Butler has been analyzing this area for three decades, and reports the weekly evolutions into great detail in his market commentaries. This is an excerpt from his latest analysis:

By far, the standout price feature for the first quarter in silver was the reduction in the total commercial net short position on the COMEX from the high point of Feb 5. From the peak on Feb 5 through last Tuesday, 29,000 net contracts were bought by the commercials. This is the equivalent of 145 million oz of silver and is clearly a towering amount compared to any amount of silver produced or consumed within the quarter. Yes, these are paper transactions, but they are so excessive in size as to overwhelm the free market forces emanating from the real world of supply and demand. Simply put, the commercials on the COMEX colluded and rigged silver prices lower during the quarter to trick the tech funds into selling.

One of those commercials is JP Morgan. Based on his analysis, Ted Butler calculates their short positions.

I would now calculate JPMorgan’s net short position to be 23,000 contracts as of Tuesday March 26th. Simple math shows that JPMorgan held 96% of the total commercial short position of 24,000 contracts in the latest COT report. I doubt such an extreme measure of concentration has ever occurred in any other regulated futures market. On this measure alone, it is safe to conclude that JPMorgan has manipulated the silver price in the last month(s), as there would be virtually no commercial short position in COMEX silver without this bank. That the CFTC and the CME Group can sit by and allow such an unnatural concentration to exist shows how inept and corrupt the regulators have become.

To put things into perspective, the current short position of JP Morgan (one single entity) equals some 12.5% of total yearly silver mining production. This short position is so concentrated that it has the power to control the overall price.

Ted Butler points out that the paper market controlling the price is illegal practice; it is against commodity law.

How to stop this illegal practice?

For how long can the paper market control the silver price is a key question. Ted Butler wrote in his latest commentary in that respect:

The question that really matters is what will JPMorgan do on the next silver rally? This is the question I asked back in December 2011 and during the summer of 2012.

Each time, the answer was resounding as JPMorgan sold as many additional shorts as was required to cap the silver price. I would imagine most would expect the same outcome again as who’s to stop these criminals, surely not the sad excuse we have as regulators. I can’t argue that the regulating agencies (CFTC or CME) will ever do the right thing in silver, but there is one thing that could persuade JPMorgan to stop manipulating the price of silver. That something is too strong of a demand for physical silver, the signs of which appear to emerge daily.

In retrospect, it was growing physical silver demand in late 2010 that prompted JPMorgan to refrain from selling short silver and which allowed the price to climb to near $50 in a matter of six months or so. The crooks at JPMorgan will see that physical silver imbalance coming before just about anyone and that will be what causes them to cease adding new silver shorts.

The market situation in silver is not sustainable long term. It can for sure go on for a while, but not ad infinitum. From a longer term risk/reward perspective, which is the fundamental rationale for physical silver investors, silver is an excellent asset to own.

I am still of the mind that we are close to a silver price bottom of some great significance and that the investment risk/reward ratio in silver has rarely been more attractive than it is currently. Whatever new price lows the commercials (read: JP Morgan) may rig in silver, it is important to recognize any imaginable price lower is vastly exceeded by the potential amount silver will move higher in price eventually. The essence of successful investment is to place funds into the thing least likely to lose money and most likely to show great gains. In this instance, silver is it.”

Saya sangat merekomendasikan para pembaca sekalian untuk berlangganan laporan yang luar biasa dari Ted Butler. Hampir seluruh analisanya secara real time mengenai evolusi di pasar perak dan memposisikan para investor di tempat yang menguntungkan.

Salah satu analisa yang paling komprehensif mengenai pasar perak yang pernah saya baca sepanjang tahun lalu adalah dari Steve St. Angelo, yang menulis laporan luar biasa pada bulan November 2012 mengenai kekuatan yang dapat mendorong kenaikan perak ke atas $100.

Karena laporan yang masuk dalam kategori HARUS DIBACA berikut ini cukup panjang, maka saya akan berikan bagian pertamanya saja, dan bagian kedua akan saya lampirkan di laporan saya berikutnya:

“There are tremendous forces at work that will push silver over $100 an ounce. Very few precious metal analysts understand all the forces that are at work. Some analysts focus on specific areas such as the gold-silver ratio and technical analysis, while others write about future investment and industrial demand. And then of course, we have the more unorthodox analysts who delve into the ongoing manipulation of gold and silver — a realization shared by the author of this article.

However, one of the most important aspects of silver that most analysts are completely unaware is the availability (or lack of thereof) of future silver mine supply. I am simply amazed how some analysts can forecast lower silver prices due to a so-called future supply glut that is supposedly coming in the next few years.

As I have mentioned before in a previous article, analysts today are so specialized they have no idea what is going on in another industry. It is highly doubtful that the metal analysts who make these long term silver supply forecasts really comprehend the details of the energy market and industry. The failure of these metal analysts to understand the complexity of the global liquid supply system will render their future forecasts completely inaccurate. This will be discussed at the latter part of the article as it is one of the longer term forces to impact silver.

Silver Surplus-Deficit Explained Again

There still seems to be a misunderstanding about the so-called surplus-deficit of silver. Some analysts are pointing to the fact that increasing annual silver surpluses, without continued strong investment demand, can make the price of silver fall quite rapidly. I would like to repost this graph to show the surplus-deficit forces.

According to GFMS (now Thomas Reuters), there was a silver deficit until 2003. During this time of supposed deficits, the price of silver remained in the $4-$5 range. However, when the deficits disappeared and the surpluses began, the price of silver magically began to rise. The first year silver was no longer in a deficit (2004) it hit an average price of $6.67 an ounce. Then in 2005 it reached an average of $7.32, $11.54 in 2007, $13.38 in 2008, $14.98 in 2009 and so on and so forth.

The white line on the graph represents the average annual price of silver. As you can see the price is heading higher in parallel with the so-called rise of silver surpluses. These silver surpluses have been absorbed by institutional and retail investors. The notion that a structural deficit in the annual silver supply would push the market price of silver higher, failed to materialize prior to 2003 when actual deficits took place.

So, here we can see that the rise in the price of silver since 2004 has less to do with industrial demand and more a factor of increased silver investment.

Silver Investment Demand: Just Getting Started

Precious metal enthusiasts who are concerned about whether or not silver investment demand will remain strong in the future… shouldn’t be. From the data I am gathering, we are just beginning to see how large of a force silver investment demand will be in the upcoming years.

One of the more notable gauges of increased silver investment over the past decade has been the growing demand of official government coins. In 2002, total supply of official government coins and medals were 31.6 million ounces. However, by 2011 this grew to a staggering 118.2 million ounces, a gain of 274% in just nine years.

The four largest selling official government coins are the U.S. Silver Eagle, the Canadian Silver Maple, the Austrian Silver Philharmonic and Australian Silver Koala & Kookaburra. These four government mints produced 101 million silver ounces of coins & medals (majority were coins), 85% of the world’s total in 2011.

Even though the sales of these official coins dropped off during the first part of year, strong demand has returned in the second half. For instance, there was a 32% decline in Silver Eagle sales in the first six months of 2012 when 17.4 million were sold compared to 22.3 million during the same period in 2011. However, if we look at the chart below we can see that 2012 Silver Eagle sales are now only down 18% compared to the same time last year.

There was also a similar decline of Silver Maples in the first half of 2012. From January to June, sales of Silver Maples fell 32% compared to last year. Nevertheless, when the Royal Canadian Mint releases its third quarter report, we will more than likely see an increase of its Silver Maple sales in percentage terms compared the first half of 2012.

Another interesting trend taking place and shown in the chart above is the amount of Silver Eagles sold compared to Gold Eagles. Compared to last year, Gold Eagle sales (-36%) are down twice as much in percentage terms than sales of Silver Eagles (-18%). Furthermore, the U.S. Mint has sold 53 times more Silver Eagles than Gold Eagles in 2012 (the ratio in 2011 was 40-1). Thus, retail investors have been purchasing 33% more Silver Eagles than Gold Eagles compared to the same period last year.

Even though the four countries listed above produce the lion’s share of official government coin sales, there is another country that has big plans to change their ranking in the future.

China: Big Plans For Future Silver Investment

China has been producing its one ounce Silver Pandas at a stable rate of 600,000 annually for nearly a decade. However, last year China decided to increase its mintage of its 2011 Silver Panda from 600,000 to 6 million… and in 2012, they plan on increasing it to 8 million. Why the sudden 10 fold increase of their Chinese Silver Panda sales in one year?

Well, according to Jim Orcholski who runs J & T Coins LLC Blog.com:

The main reason the mintage of these coins was increased so much starting last year is that it became legal in 2011 for Chinese citizens to own silver coins.

While this huge increase in silver Panda production figures seems impressive, it may only be a drop in the bucket for what is being planned by the Chinese government in the future. Again, according to Orcholski quoted in the article “China Strives to Make Silver Panda as Popular as American Silver Eagle”:

The Chinese government is also eager to make Silver Pandas as popular as American Silver Eagles. Pandas are obviously very popular within China, and it’s not known how many of the Silver Pandas are exported and how many are sold within the country.

For the Chinese government to make good on its promise to popularize its Silver Panda to equal that of the American Silver Eagle, they will have to increase their annual mintage substantially. In 2011, the U.S. mint sold nearly 40 million Silver Eagles. If the Chinese plan on surpassing this record, I would imagine they may set their goal at producing 50 million annually. This may not be that tough of a challenge due to the fact that the China has three times the population of the United States, and their citizens are becoming keen buyers of the precious metals.

It is plain to see, that the demand for official government silver coins has gone exponential over the past decade. However, this is only one part of the overall silver investment picture.

Silver Investment Demand vs. Industrial Applications

One of the more tiresome, boring and overused analysis in determining the future price of silver, is the forecasted consumption of silver in industrial applications. There is this notion that if the world’s economies slide into a severe depression, then the demand for silver will fall as industrial activity declines. Thus, we would have much lower silver prices… that is, according to these analysts.

Hogwash. We now know from the data provided in both the surplus-deficit and official government coin charts above, it has been investment demand rather than industrial demand that has been the overriding force in determining the market price of silver. Again, if industrial demand didn’t move the price when we had real annual silver deficits in the past, why on earth would we expect it to affect the price in the future.

To get a true picture of the massive increase of silver investment during the past decade, take a look at the chart below:

The grey bars in the chart above show how much silver was consumed on an annual basis by industrial applications while the blue represent coin & medal demand and the orange denotes implied net investment. These figures do not include silver consumption in either photography, jewelry or silverware. Below is the data for the following years (from the Silver Institute):

By adding the silver demand from official coin-medal and implied net investment together, we get the total amount for the year which was 31.6 million oz in 2002. Thus, total world silver investment in 2002 was just a mere 9% of the silver consumed by industrial applications. However, by 2011 global silver investment jumped to 282.2 million oz accounting for 58% of silver used by industrial applications.

The World Silver Survey calculates Implied Net Investment by subtracting total fabrication from the total global silver supply. In 2011, global silver supply (mine & scrap) was 1.04 billion oz and total fabrication (industrial applications, photograph, jewelry, silverware and coin & medal) consisted of 876 million oz leaving a difference of 164 million oz as implied net investment.

According to the 2012 World Silver Survey, physical bar investment accounted for 98 million oz of the 164 million oz implied net investment total in 2011. Here again, we can see from the two charts above, institutional and retail investors have been the predominant force in pushing silver from an average of $4.60 an ounce in 2002 to averaging over $35 an ounce last year.

Even though silver has risen nearly 75% per year for the past nine years… this is just the beginning of the price moves to come. Why? It looks like something quite fishy is taking place in the precious metal exchanges.

U.S. Silver Exports: Putting Out The LMBA Fire?

In the past, investors were happy to fork over hard earned money for paper promises of gold and silver. However, that trend seems to be reversing quite rapidly. After the collapse and bankruptcy of several large commodity brokerage houses along with the supposed ongoing threat that allocated and unallocated gold and silver accounts have been rehypothocated (stolen), investors are now demanding delivery of physical metal instead of paper I.O.U.’s.

Furthermore, a week doesn’t go by without an article written about government gold repatriation or whether or not a central bank actually holds the very gold (or rights to the gold) that is shown on its balance sheet. When we add up all these factors, who can blame the investor for wanting to acquire the real physical asset?

One country that is scarfing up as much of the precious metals as it can, is China. According to the research done by Jim Willie, massive amounts of gold (official & unofficial) have been shipped from West to East (mainly China) in the past several years. One place for an investor or a sovereign country to take delivery of large quantities of gold and silver is from the LBMA located in London — the largest metal exchange in the world.

Rumors are floating around the precious metal blogosphere that wholesale physical supplies of gold and silver are extremely tight, even though so-called “official statistics” may state otherwise. Nevertheless, there is one “official source” that may help confirm these rumors.

In 2011, the USGS published that the U.S. exported 19 metric tonnes of silver bullion to the United Kingdom during the entire year — a very miniscule amount indeed. However, something very interesting occurred in May of this year. In May, the U.S. exported 19.4 metric tonnes of silver which was more silver than was exported during the twelve months in 2011… and this is just the tip of the iceberg.

If we look at the chart below, we can see just how much silver is leaving the shores of the U.S. and being shipped to the United Kingdom in 2012:

In the upper right hand portion of the chart you will see the quantity of silver exported each month to the United Kingdom. In addition to the figure stated above, the United States exported 37.3 metric tonnes of silver in June, 169 metric tonnes in July and 65.3 metric tonnes in August. In just four months, the U.S. has exported 291 metric tonnes of silver to London (LBMA).

There are two significant trends taking place that are represented in the chart above. First, the United States has exported more silver bullion in the first seven months of the year than it did in all of 2011. Secondly, silver bullion shipped to the United Kingdom rose from 3% of total U.S. silver exports in 2011, to a staggering 42% of the 700 million oz exported so far this year.

Why has there been such a large increase of silver bullion exports to the United Kingdom over the past few months? Could it be that the English have suddenly ramped up solar power manufacturing… or may it be due to an abrupt increase in foreign demand for their formal silverware? I highly doubt it.

More likely than not, the large silver bullion exports to the U.K. have been utilized to help meet the insatiable physical silver bullion demand taking place on the LBMA. As the old saying goes… where there is smoke, there’s probably a great deal of silver paper on fire.

If we consider the strong investment demand forces described in the examples above (present & future), I hate to say, investors should probably brace themselves for much higher silver prices in the next several years. Yet, investment demand is only one part of the powerful forces that will push the price of silver over $100 an ounce.”

Bersambung di laporan berikut …

 

Dan berikut gambar lucu yang semoga bisa menceriakan Anda saat ini:

Dibuat Tanggal 16 April 2013

Categories: Pasar Internasional Tags:

Investasi Favorit Saya untuk Dekade ke Depan (Bagian 1)

April 17th, 2013 No comments

“Unlike gold, which has very little industrial use, silver is also an industrial metal and gets used up in all sorts of manufacturing processes.  It’s also largely a byproduct of big base-metal mines (there’s almost no pure silver production in the world), so the supply crunch we see ahead affects it much more than gold.  Silver has become the win-win metal.”

– Louis James, senior editor of the International Speculator

Anda mungkin terkejut jika mengetahui bahwa investasi favorit saya di tahun-tahun mendatang bukanlah saham, obligasi atau properti, tapi PERAK. Meskipun telah mengungguli aset-aset terkemuka dunia dalam 5 hingga 10 tahun belakangan,  lima dan sepuluh tahun periode, perak  masih merupakan salah satu komoditas yang paling undervalued – atau jika boleh saya katakan kurang dihargai.

Perak saat ini diperdagangkan di bawah $25/ons, dan para pengamat memprediksi akan melambung ke harga puncak yang disesuaikan dengan inflasi, di $130/ons pada tahun 2015. Alasan beberapa analis memprediksi peningkatan drastis harga perak tersebut karena ekonomi dunia yang tengah tertekan, pasokan perak yang merosot, permintaan industri yang signifikan, peran perak sebagai penyimpan nilai (store of value), penggunaannya sebagai mata uang, dan meningkatnya permintaan investasi.

Saya pribadi memang mempercayai perak adalah logam yang menakjubkan, yang cenderung akan melambung di tahun-tahun mendatang. Seperti mungkin Anda telah ketahui bahwa perak memiliki lebih dari 10 ribu kegunaan, dan sebagai salah satu pengantar panas dan listrik terbaik dunia. Dan para penemu pun lebih banyak mengajukan hak paten pada penggunaan perak dibanding logam berharga lainnya di dunia.

Bahkan ketika perak digunakan untuk tujuan industri dan teknologi, maka secara harfiah akan digunakan selamanya karena ternyata terlalu banyak biaya yang dikeluarkan untuk mencoba mendaur ulang perak, bahkan dalam volume kecil sekalipun seperti pada ponsel atau chip kasino.

Juga perlu diingat bahwa perak bukan hanya seebagai komoditas safe haven (aman resiko), tetapi namun memiliki peran sebagai mata uang dan nilai moneter ini tidak dapat didevaluasi seperti umumnya mata uang dunia. Perak bahkan memiliki perbedaan dalam penggunaan sebagai uang untuk waktu yang lebih lama dan di tempat-tempat yang lebih banyak daripada emas. Menurut Nobel Laureate Milton Friedman, “The major monetary metal in history is silver, not gold.”

Berikutnya yang tak kalah penting adalah bahwa hanya ada kurang dari 1 miliar ons perak murni di dunia. Lebih dari 90 persen dari hasil tambangnya digunakan oleh industri. Tuntutan industri ini senantiasa melampaui pasokannya selama 20 tahun terakhir.

Meskipun produksi belakangan ini relatif masih datar, persediaan dan pasokan pemerintah masih mampu menahan kenaikan harga. Sumber-sumber tersebut akan menurun dan jika melihat ke belakang pasokan tidak akan selalu dapat memenuhi peningkatan permintaan!

Namun demikian, kebanyakan orang yang telah berbincang pada saya benar-benar belum tertarik pada perak karena mereka masih menganggap emas lebih berharga dan/atau sama sekali belum memahami tentang perak. Mungkin idiom yang tepat untuk menggambarkan pandangan orang-orang tersebut tentang perak adalah ‘out of sight, out of mind’…

Seorang ahli perak terkemuka, Ted Butler, yang merupakan analis riset pertama yang secara terbuka mengakui dan menulis tentang konsekuensi dari pinjaman logam mulia serta kegagalan forward-sale dalam usahanya untuk menghentikan sewa logam, adalah seorang penulis yang produktif dan analisa peraknya telah beredar luas di internet.

Dalam salah satu laporannya, yang diterbitkan pada tanggal 2 Desember 2011, ia menghimbau dengan tegas pada para pembacanya untuk memandang jauh ke depan karena keunggulan perak atas aset-aset global lainnya akan mengejutkan dalam jangka panjang:

“With more financial uncertainty in the world than in memory and with price volatility going through the roof, it’s hard to think about the long term. The only problem is that our lives are still measured in the long term. In financial terms, starting families, raising and educating children, preparing for retirement and preserving hard-earned wealth are not day to day considerations; we are forced to look ahead.  In looking and planning ahead, there is no crystal ball; no guarantee that things will turn out as we expect.  All we can do is to make assumptions based upon what we now know and then try to position ourselves for what may come.

Imagine that you are going on a journey for ten years and will be out of touch for that time. With no short term trading allowed, what assets would you choose to invest in until your return?  Silver is an asset that can offer spectacular returns and preserve value with low risk. It is a vital resource and essential industrial material in addition to being a precious metal.  And because so few investors are familiar with the real silver story, it is a near certainty that silver will become more appreciated over time.

There are limitations on the future supply of silver. Every metal resource in the world becomes more expensive to produce each year.  That’s due to the growing cost of extraction and because ore grades have declined (the biggest and cheapest deposits have already been found and exploited). The grades for silver ounce per ton of ore 150 years ago at the Comstock Lode were hundreds of times richer than grades being discovered today.   It takes greater effort and expense to extract metals from the earth, to say nothing of new environmental restrictions.

The world population now stands at seven billion.  Over the next ten years, the world will add another 750 million and perhaps a billion people on top of that over the twenty years.  That’s six times the equivalent of the current population of the U.S.  That will most likely be accompanied by an increase in the standard of living throughout the world. One measure of an increased standard of living includes greater use of electrical appliances and electronic devices of all types, from TV’s, refrigerators, washing machines to computers and cell phones.

Since silver is the best conductor of electricity it is sure to be in greater demand. Plus silver has other important attributes.  It’s the best reflector of light, the best transfer agent for heat and has important biocide properties, making it indispensible to modern life.

Silver performed better than any other asset over the past decade. But don’t buy silver because it did well, buy it for the new forces in place in the world. Ten years ago, there was no net investment in silver.  Only in the last five years has the world taken to investing in silver. Over that time, over 600 million ounces of silver have been bought in Exchange Traded Funds (ETFs), with hundreds of millions of additional ounces of silver bought in coins and bars.  Five years in a worldwide investment movement is a very short time frame.  In per capita terms, the world only bought one-tenth of an ounce of silver per person.  It would be accurate to suggest that a worldwide movement towards investing in silver is in its infancy.

There is more investment capital today than ever before.  Between the banks, large investment pools, and hedge funds, that capital base is more concentrated than ever.  We are talking about many trillions of dollars.  All the silver bullion in the world is valued at less than $35 billion. Despite silver’s great investment performance over the past 5 and 10 years, it has yet to attract investment from these big concentrated pools of wealth.  It is only a matter of time before the really big guys wake up and make a move into the metal. Considering how little silver exists to accommodate them, the effect on price when it occurs should be explosive.

One thing that didn’t exist ten years ago is the growing unease over government debt.  For the first time in living memory, sovereign debt in the developed nations has come to be questioned and shunned. This is not going to go away or be resolved easily. It is not hard to imagine the distrust of paper growing. A distrust of paper is a distrust of someone else’s promise to pay.  The only escape route is to switch to assets not dependent on someone else’s promise or ability to pay. Silver is a premier example of such an asset. The kicker with silver is that without any rush from paper assets it will still be great.

The growing distrust of European sovereign debt is occurring at the same time there has been a rush to deposit money in government paper obligations and insured bank accounts. Given volatile stock markets, a troubled real estate market and broad economic malaise, people are voting for safety, despite historically low returns on deposits. Investors are flooding the banks with deposits that earn little or no interest. Money is piling up on the sidelines like never before. In due course, it will seek better investment returns than the near zero returns currently offered on insured deposits.  Silver will attract some of this money. Either we’ll come out of this economic mess and all the money currently flooding into the banks will increase industrial demand for silver; or we’ll slide into further distrust of paper which could set off a buying panic in silver. In either outcome, it’s hard to see how silver won’t be the place to be.

The outlook for silver looks better than ever.  There are important regulatory changes afoot that promise to powerfully impact the price. There will also be closure to the current CFTC investigation of wrongdoing in the silver market. The manipulation to the downside in silver has many times the awareness that it did a decade ago and there are fewer counterarguments to explain it. Take advantage of the current low prices to establish a long term position in silver; I doubt you’ll regret it. As unsettling as financial events may be, they are actually quite positive for silver.

The reason for recent price drops rests with a group of around 20 commercials on the COMEX, including JPMorgan, that know how to suddenly rig prices lower (usually in the middle of the night or at some other thinly traded time).  Knowing that this will scare some people into selling and keep others from buying, this small group of commercials then sits back and waits to buy what they can scare others into selling.  I call this financial terrorism because it causes fear among investors.  The proof is that government data consistently reveals that these commercials are always the big buyers on any sharp sell-off in silver.  No exceptions.  Some might call this just luck on the part of these commercials.  I call it manipulation and financial terrorism.

It’s ironic that most silver and gold investors originally bought precious metals as protection against exactly the type of financial crisis we are going through now.  In other words, the price of gold and silver should be soaring based upon current conditions.  Instead, the manipulation is so pronounced that the crooked commercials on the COMEX have managed to convince the market that a flight from paper assets is somehow bad for precious metals.  That’s preposterous and you should not be fooled by their crooked games.  The proof is that these commercials crooks are buying hand over fist on the contrived sell-offs.  You should do exactly the same.  These rigged price drops are an opportunity like no other.  The fact that it is being artificially suppressed means you are getting a chance to buy it much cheaper than it would be in a free market.  That has to change and when it does it will be like a sling shot in the other direction.  The facts are more bullish than we can fully comprehend.” (semua yang dicetak tebal adalah penekanan saya pribadi)

For subscription info please go to www.butlerresearch.com

Selain itu Eric Sprott, CEO, CIO, dan seorang Portfolio Manager senior di Sprott Asset Management, mempertanyakan di akhir tahun lalu mengapa para investor (yang cerdas) membeli perak 50 kali lebih banyak dari emas dalam artikelnya berikut, yang menurut saya masuk dalam kategori yang HARUS DIBACA:

“As long-time students of precious metals investing, there are certain things we understand. One is that, historically, the availability ratio of silver to gold has had a direct influence on the price of the metals. The current availability ratio of physical silver to gold for investment purposes is approximately 3:1. So, why is it that investors are allocating their dollars to silver at a much higher ratio? What is it that these “smart” investors understand? Let’s have a look at the numbers and see if it’s time for investors to do as a wise man once said and “follow the money.”

Average annual gold mine production is approximately 80 million ounces, which together with an estimated average 50 million ounces of annual recycled gold, totals around 130 million ounces available per year. In comparison, annual mined silver production has averaged around 750 million ounces, while recycled silver is estimated at 250 million ounces per year, which adds up to approximately 1 billion ounces. Using this data, there is roughly 8 times more silver available to buy than there is gold. However, not all gold and silver is available for investment purposes, due to their use in industrial applications. It is estimated that for investment purposes (jewelry, bars and coins), the annual availability of gold is roughly 120 million ounces, and of silver it is 350 million ounces. Therefore, the ratio of physical silver availability to gold availability is 350/120, or ~3:1.1

Now, let’s examine how investors are allocating their investments between gold and silver. The data below is from the US Mint showing gold and silver sales in ounces:

Source: US Mint (www.usmint.gov)

As you can see, investors are choosing to buy silver at a ratio to gold that is well above what is available. This uptrend doesn’t show any signs of slowing either. The ratio of the physical silver to gold is both rising and extraordinarily above the availability ratio of 3:1.

We can also use other data such as the most recent issues of the Sprott Physical Gold and Silver Trusts. The last Gold Trust issue in September 2012 raised US$393 million and the last Silver Trust issue raised US$310 million. On the basis of prices for each metal at the time of issue, we could purchase ~213 thousand ounces of gold and ~9.1 million ounces of silver. This represents a purchase ratio of 43:1.

If we examine ETF holdings in both gold and silver, we note that in the period from 2007 to 2012, the increase in silver holdings amounted to 12,000 tonnes, compared to 1,200 tonnes of gold – meaning, investors purchased ten times more silver than gold.

These are only three factual data points to consider, but there are other indications that silver investment demand is way out of line with availability. Our favorite question to the bullion dealers we meet, is to ask the ratio of their dollar sales in gold versus silver. The answer is that dollar sales are equal, which means that physical silver sales relative to gold are greater than 50:1.

A recent news headline on Mineweb read, “Silver Sales to Outshine Gold in India.2” It went on to quote a bullion dealer that “investors and jewelry lovers prefer silver jewelry these days.” As the largest importer of gold in the world, it would be impossible for India to purchase an equivalent amount of silver, as it would require more than one billion ounces, essentially more than the current annual mine production.

While these last two confirmations of silver demand are anecdotal, the statistics from the US Mint, the ETFs, and our Physical Trust issues, are factual.

For the time being, the silver price is essentially set in the paper market where the daily average trade on the Comex is approximately 300 million ounces. An outrageous number when you compare it to the daily mine production of about 2 million ounces. As Bart Chilton, Commissioner of the Commodity Futures Trading Commission stated on October 26, 2010, “I believe there have been repeated attempts to influence prices in silver markets. There have been fraudulent efforts to persuade and deviously control that price. Based on what I have been told and reviewed in publicly available documents, I believe violations to the Commodity Exchange Act have taken place in the silver market and any such violation of the law in this regard should be prosecuted.”3

Which brings us back to the phrase “Follow the money.” In our view, it is almost inconceivable that investors would allocate as many dollars to silver as they would to gold, but that is what the data shows.

The silver investment market is very small. While the dollar value of gold in the world approaches $9 trillion, the value of silver in the forms of jewelry, coins, bars and silverware is estimated at around $150 billion (5 billion ounces at $30 per ounce). This is a ratio of 60:1 in dollar terms.4

How long can investors continue to buy silver at the current ratios when the availability for investment is only 3:1? We are surprised that the price of silver has remained at such a depressed level compared to gold. Historically, the price ratio between gold and silver has been 16:1, when both were currencies. Today the ratio is 55:1, so what are the numbers telling us? We believe this is one of those times when smart investors will be well rewarded to “Follow the money.”

1 Sources: Gold data is from World Gold Council www.gold.org, and silver data is from Silver Institute, http://www.silverinstitute.org/site/supply-demand/
2 Source: Mineweb.com
3 Source: Bloomberg: http://mobile.bloomberg.com/news/2010-10-26/silver-market-faced-fraudulent-efforts-to-control-price-chilton-says.html
4 Sources: Gold data is from World Gold Council, silver data is from United States Geological Survey (USGS) and Silver Institute.

What Do the Charts Say?

Adam Brochert, seorang editor pada Gold Versus Paper, memberikan grafik beserta komentar yang menarik pada pekan lalu serta mengingatkan orang-orang yang peduli bahwa saat ini mungkin akan menjadi momen bagus untuk mulai mengakumulasi perak:

“The big money is made by sitting tight and holding on during a big bull market. Those who held common stocks thru the 1987 crash certainly didn’t regret it for long. Meanwhile, using silver as a more volatile proxy for the Gold bull market, it seems as though we may be at the end of a big 4th wave-type correction that suggests a mania phase dead ahead:

If you accept this Elliott Wave labeling (not saying it is correct – this is just an opinion), it would suggest that the first wave resulted in a roughly 5.3 fold gain and the third wave roughly a 5.9 fold gain. Thus, since the first and third waves are roughly of equal magnitude, the fifth (and final) wave higher is likely to be of the extended variety and thus perhaps a 9-11 fold gain is coming. This would mean a peak for silver in the $200-$300 USD per ounce range. To anyone who thinks this is an outrageous number, I would ask: what do you think of one quadrillion as a number tracking the amount of outstanding financial derivative instruments in existence or one trillion dollars being the annual deficit of the world’s current largest single country economy (i.e. USA). As last week’s policy announcement from the Bank of Japan proved, there is no limit to the insanity induced by drinking the collective Kool Aid.

This is a juicy set up for a trade, if nothing more. I think it will be much, much more. Much as in the last cycle (i.e. 2003-2008), it may well be another commodity price spike that derails the current “Goldilocks” scenario. I think Gold and silver are set to lead such a spike as business conditions continue to deteriorate globally. Meanwhile, the futures COT (commitment of traders) report indicates unusually skewed bearishness for all but the commercial traders (large banks like JP Morgan), who are now as bullish on silver as they ever seem to get (chart below stolen from Software North):

This is a potentially explosive situation that strongly favors a resolution in the PM bulls’ favor. I don’t think there has been a reading of greater than 45% bullish for the commercial traders in the past 10 years, and they are now at 43%. The momentum-chasing hedge funds are piling on the shorts here right as we hit trading range support. With an expanding open interest (rather than the usual decline into a low), an explosive short covering rally could occur with the slightest hint of a bottom (such as, say, with the action to end last week?).”

Kesimpulan

Ingatlah selalu bahwa hanya perak yang memiliki peran ganda sebagai dasar dari aset investasi dan material industri.  Yang membedakan perak dari komoditas sumber daya alam lainnya adalah daya tarik yang sudah berlangsung ribuan tahun, saat menjadi sebagai simbol kekayaan manusia dan kemudian berkembang sebagai material industri yang vital di dunia modern ini.

Jadi meskipun banyak orang berinvestasi di emas, logam mulia ini tidak memiliki peran ganda yang unik seperti perak, yakni aset investasi dan material industri. Itulah yang membuat perak menjadi langka.

Hal yang menakjubkan adalah bagaimana sejumlah investor potensial dunia menghargai keunikan peran ganda perak tersebut. Kemudahan investasi di perak sudah sangat diketahui dunia. Di beberapa dekade lalu, perak dikenal merupakan mata uang logam umum. Hal ini menjelaskan mengapa orang mengalami kesulitan memahami bagaimana suatu materi yang sebelumnya melimpah kini bisa dianggap langka. Berapa banyak orang yang tahu bahwa persediaan perak dunia sudah turun 90% sejak tahun 1940? Itulah yang sebenarnya telah menciptakan peluang investasi seumur hidup – melihat sesuatu lebih awal.

Akhirnya, mari berpikir sejenak mengenai hal berikut: Berapa banyak tetangga, teman, kerabat dan orang sekitar yang Anda tahu telah berinvestasi serius dalam perak? Saya kira akan sulit menemukan 1 dari 100 orang yang Anda tahu, atau bahkan 1 dalam 1000 orang. Meskipun terjadi kenaikan harga yang mengesankan selama 10 tahun terakhir, perak masih jauh sebagai aset yang dimiliki atau masih kurang dihargai. Investasi mengalir ke perak, dibandingkan dengan aset dunia lainnya, kecil. Namun, jumlah perak yang tersedia di pasar fisik untuk investasi memang sangat kecil sehingga arus investasinya hingga saat ini cukup untuk mendongkrak kenaikan harganya.

Agar Anda tetap ceria seperti biasa di akhir tulisan ini saya tampilkan sebuah gambar lucu untuk Anda:

Dibuat Tanggal 15 April 2013

Categories: Pasar Internasional Tags:

Kotak Pandora Telah Terbuka di Eropa (Bagian 2)

April 12th, 2013 No comments

“Cypriots may bemoan the inequities of their rough treatment, as might a bunch of wealthy Russians who mistook the island for a reliable financial center and failed to yank their money when they could.  For the rest of Europe, the implications should be obvious.  Anyone who leaves uninsured deposits in a euro-area bank is on notice that their money can and will be taken from them, if that is what’s demanded by the troika of the IMF, the European Commission and the European Central Bank.”

– Jonathan Weil of Bloomberg

“Europe is really in a bind now because they don’t want to allow anyone to leave the euro.  They know that when the first country leaves the euro it may start a chain reaction.  I have always been of the belief that the euro was a doomed project, but I think this catastrophic situation in Cyprus may be the event that marks the beginning of the dissolution of the euro as we know it.”

– John Embry, chief investment strategist at Sprott Asset Management

Hari ini saya ingin melanjutkan diskusi tulisan Senin sebelumnya tentang kemungkinan konsekuensi dari kesepakatan Siprus. Tampaknya sebagian besar orang masih tidak menyadari fakta bahwa kesepakatan tersebut akan memiliki dampak yang menyebar jauh ke luar negara kepulauan kecil ini, oleh karenanya menurut saya tidak ada salahnya untuk melihat lagi sejumlah implikasi.

Salah satu rekan saya di Dow Jones Newswires memberikan penjelasan bagus dalam tulisannya di prospek pasar harian, bahwa: “many are still arguing that Cyprus is simply too small to matter.  After all, the economy accounts for just 0.2% of euro-zone GDP and barely 0.03% of global GDP.  However, size was never the issue here.

Instead, the key points are what we have learned about the stance of the ECB and policymakers in the “core” economies, and the precedents being set for other, larger countries that may find themselves in a similar position to Cyprus.”

Begitu banyak tulisan mengenai persoalan bail-in dan haircut besar-besaran di Siprus untuk deposan yang tidak diasuransikan – yang asumsinya adalah para pelaku pencucian uang yang merupakan oknum di pemerintahan Rusia – sehingga, sepertinya, realitas kehidupan masyarakat Siprus pun dilupakan. Bahkan pada akhirnya, ada banyak usaha dan kehidupan masyarakat kecil yang menjadi korban.

Hal inilah yang diutarakan oleh Michael Snyder dari The Economic Collapse Blog di salah satu tulisan terbarunya yang berjudul How Would You Feel If Everything You Have Ever Worked Was Taken Away? Selain itu, Snyder juga mengingatkan bahwa hal ini BUKAN kasus unik dan bisa juga terjadi pada kita semua jika tidak mengantisipasinya dengan baik:

“What would you do if you woke up one day and discovered that the banksters had “legally” stolen about 80 percent of your life savings?  Most people seem to assume that most of the depositors that are getting ripped off in Cyprus are “Russian oligarchs” or “wealthy European tycoons”, but the truth is that they are only just part of the story.  As you will see below, there are small businesses and aging retirees that have been absolutely devastated by the wealth confiscation that has taken place in Cyprus.

Many businesses can no longer meet their payrolls or pay their bills because their funds have been frozen, and many retirees have seen retirement plans that they have been working toward for decades absolutely destroyed in a matter of days.  Sometimes it can be hard to identify with events that are happening on the other side of the globe, but I want you to try to put yourself into their shoes for a few minutes.  How would you feel if something like this happened to you?

For example, just consider the case of one 65-year-old retiree that has had his life savings totally wiped out by the “wealth tax” in Cyprus.  His very sad story was recently featured by the Sydney Morning Herald

”Very bad, very, very bad,” says 65-year-old John Demetriou, rubbing tears from his lined face with thick fingers. ”I lost all my money.”

John now lives in the picturesque fishing village of Liopetri on Cyprus’ south coast. But for 35 years he lived at Bondi Junction and worked days, nights and weekends in Sydney markets selling jewellery and imitation jewellery.

He had left Cyprus in the early 1970s at the height of its war with Turkey, taking his wife and young children to safety in Australia. He built a life from nothing and, gradually, a substantial nest egg. He retired to Cyprus in 2007 with about $1 million, his life savings.

He planned to spend it on his grandchildren – some of whom live in Cyprus – putting them through university and setting them up. There would be medical bills; he has a heart condition. The interest was paying for a comfortable retirement, and trips back to Australia. He also toyed with the idea of buying a boat.

He wanted to leave any big purchases a few years, to be sure this was where he would spend his retirement. There was no hurry. But now it is all gone.

”If I made the decision to stay, I was going to build a house,” John says. ”Unfortunately I didn’t make the decision yet.

”I went to sleep Friday as a rich man. I woke up a poor man.”

You can read the rest of the article right here.

How would you feel if you suddenly lost almost everything that you have been working for your entire life?

And many small and mid-size businesses have been ruined by the bank account confiscation that has taken place in Cyprus.

The following is a bank account statement that was originally posted on a Bitcoin forum that has gone absolutely viral all over the Internet.  One medium size IT business has lost a staggering amount of money because of the “bail-in” that is happening in Cyprus…

The following is what the poster of this screenshot had to say about what this is going to do to his business…

Over 700k of expropriated money will be used to repay country’s debt. Probably we will get back about 20% of this amount in 6-7 years.

I’m not Russian oligarch, but just European medium size IT business. Thousands of other companies around Cyprus have the same situation.

The business is definitely ruined, all Cypriot workers to be fired.

We are moving to small Caribbean country where authorities have more respect to people’s assets. Also we are thinking about using Bitcoin to pay wages and for payments between our partners.

Special thanks to:

- Jeroen Dijsselbloem

- Angela Merkel

- Manuel Barroso

- the rest of officials of “European Commission”

With each passing day, things just continue to get worse for those with deposits of over 100,000 Euros in Cyprus.  A few hours ago, a Reuters story entitled “Big depositors in Cyprus to lose far more than feared” declared that the initial estimates of the losses by big depositors in Cyprus were much too low.

And of course the truth is that those that have had their deposits frozen will be very fortunate to ever see any of that money ever again.

But just a few weeks ago, the Central Bank of Cyprus was swearing that nothing like this could ever possibly happen.  Just check out the following memo from the Central Bank of Cyprus dated “11 February 2013″ that was recently posted on Zero Hedge

Sadly, the truth is that the politicians will lie to you all the way up until the very day that they confiscate your money.

You can believe our “leaders” when they swear that nothing like this will ever happen in the United States, in Canada or in other European nations if you want.

But I don’t believe them.

In fact, as an outstanding article by Ellen Brown recently detailed, the concept of a “bail-in” for “systemically important financial institutions” has been in the works for a long time…

Confiscating the customer deposits in Cyprus banks, it seems, was not a one-off, desperate idea of a few Euro zone “troika” officials scrambling to salvage their balance sheets. A joint paper by the US Federal Deposit Insurance Corporation and the Bank of England dated December 10, 2012, shows that these plans have been long in the making; that they originated with the G20 Financial Stability Board in Basel, Switzerland (discussed earlier here); and that the result will be to deliver clear title to the banks of depositor funds.

If you do not believe that what just happened in Cyprus could happen in the United States, you need to read the rest of her article.  The following is an extended excerpt from that article

*****

Although few depositors realize it, legally the bank owns the depositor’s funds as soon as they are put in the bank. Our money becomes the bank’s, and we become unsecured creditors holding IOUs or promises to pay. (See here and here.) But until now the bank has been obligated to pay the money back on demand in the form of cash. Under the FDIC-BOE plan, our IOUs will be converted into “bank equity.”  The bank will get the money and we will get stock in the bank. With any luck we may be able to sell the stock to someone else, but when and at what price? Most people keep a deposit account so they can have ready cash to pay the bills.

The 15-page FDIC-BOE document is called “Resolving Globally Active, Systemically Important, Financial Institutions.”  It begins by explaining that the 2008 banking crisis has made it clear that some other way besides taxpayer bailouts is needed to maintain “financial stability.” Evidently anticipating that the next financial collapse will be on a grander scale than either the taxpayers or Congress is willing to underwrite, the authors state:

An efficient path for returning the sound operations of the G-SIFI to the private sector would be provided by exchanging or converting a sufficient amount of the unsecured debt from the original creditors of the failed company [meaning the depositors] into equity [or stock]. In the U.S., the new equity would become capital in one or more newly formed operating entities. In the U.K., the same approach could be used, or the equity could be used to recapitalize the failing financial company itself—thus, the highest layer of surviving bailed-in creditors would become the owners of the resolved firm. In either country, the new equity holders would take on the corresponding risk of being shareholders in a financial institution.

No exception is indicated for “insured deposits” in the U.S., meaning those under $250,000, the deposits we thought were protected by FDIC insurance. This can hardly be an oversight, since it is the FDIC that is issuing the directive. The FDIC is an insurance company funded by premiums paid by private banks.  The directive is called a “resolution process,” defined elsewhere as a plan that “would be triggered in the event of the failure of an insurer . . . .” The only  mention of “insured deposits” is in connection with existing UK legislation, which the FDIC-BOE directive goes on to say is inadequate, implying that it needs to be modified or overridden.

*****

You can find the rest of her excellent article right here.  I would encourage everyone to especially pay attention to what she has to say about derivatives.

Sadly, what is happening in Cyprus right now is just the continuation of a trend.  In recent years, governments all over the world have turned to the confiscation of private wealth in order to solve their financial problems.  The following examples are from a recent article posted on Deviant Investor

October 2008 – Argentina’s leftist government, facing a gigantic revenue shortfall, proposes to nationalize all private pensions so as to meet national debt payments and avoid its second default in the decade.

November 2010 – Headline – Hungary Gives Its Citizens an Ultimatum: Move Your Private Pension Fund Assets to the State or Permanently Lose Your Pension – This is an effective nationalization of all pensions.

November 2010 – Ireland elects to appropriate ten billion Euros from its National Pension Reserve Fund to help fund an eighty-five billion euro rescue package for its besieged banks. Ireland also moves to consider a regulatory move that compels some private Irish pension funds to hold more Irish government debt, thereby providing the state with a captive investor base but hugely raising the risk for savers.

December 2010 – France agrees to transfer twenty billion Euros worth of assets belonging to its Fonds de Reserve pour les Retraites (FRR), the funded portion of its retirement system, to help pay off recurring social benefits costs. No pensioners are consulted.

April 2012 – Argentina announces that its Economy Ministry has taken an emergency loan from the national pension fund in the amount of $4.3 billion. No pensioners were consulted.

June 2012 – Treasury Secretary Timothy Geithner unilaterally appropriates $45 billion from US federal pension funds to help tide over US deficits for the remainder of fiscal year 2011.

January 2013 – Treasury Secretary Geithner again announces that the government has begun borrowing from the federal employees pension fund to keep operating without passing the approaching “fiscal cliff” debt limit. The move effectively creates $156 billion in borrowing authority from federal pension funds.

March 2013 – Open Bank Resolution finance minister, Bill English, is proposing a Cyprus style solution for potential New Zealand bank failures. The reserve bank is in the final stages of establishing a rescue scheme which will put all bank depositors on the hook for bailing out their banks. Depositors will overnight have their savings shaved by the amount needed to keep distressed banks afloat.

Can you see the pattern?

As I wrote about the other day, no bank account, no pension fund, no retirement account and no stock portfolio will be able to be considered 100% safe ever again.

And once the global derivatives casino melts down, there are going to be a lot of major banks that are going to need to be “bailed in”.

When that day arrives, they are going to try to come after your money.

So don’t leave your entire life savings sitting in a single bank – especially not one of the banks that has a tremendous amount of exposure to derivatives.

Hopefully we can get more people to wake up and realize what is happening.  We are moving into a time of great financial instability, and what worked in the past is not going to work in the future.

Be smart and get prepared while you still can.

Time is running out.”

Saya sungguh menghimbau Anda untuk mengambil pelajaran dari kondisi Siprus karena semakin mengikis kepercayaan investor terhadap sistem keuangan ke depannya. Saya juga percaya Anda perlu memiliki beberapa aset di luar sistem. Dengan kata lain, Anda perlu memiliki beberapa aset yang tidak tercetak dan diatur di perbankan, seperti emas dan perak.

Sebagai seorang investor, Anda harus lebih berhati-hati setelah apa yang terjadi di Siprus agar terhindar dari kerugian finansial. Egon von Greyerz, seorang pendiri Matterhorn Asset Management, baru-baru ini melalui King World News juga mengingatkan bahwa sistem finansial global bisa ambruk kapan saja untuk saat ini.

Bahkan menurutnya masalah di Siprus akan menyebar ke dunia.  Untuk jelasnya berikut adalah apa yang dikatakan Greyerz dalam wawancaranya tersebut, yang menurut saya masuk dalam kategori WAJIB DIBACA:

“Cyprus is a momentous event.  Losses could be in the tens of billions of dollars.  But like all major crises there is always a catalyst, and whether it was a shot in Sarajevo (assassination of Archduke Ferdinand which started World War I), or the fall of the Credit-Anstalt in Austria in 1931, there is always an event in history which people look back on as the start of tremendous global turmoil.  Cyprus could very well be that event.

There will be some kind of solution eventually to the Cyprus problem, but it will be seen as unsatisfactory in the fullness of time.  It is unlikely to come from Russia because I don’t think Europe would like to see Cyprus become an entirely Russian state, which would of course be the case if Russians were to give their support in a major way.

But whether the bailout comes from the ECB or the IMF, of course they have no money….

The IMF is financed by the US and Japan, and they have no money either.  So wherever the money is going to come from, it isn’t there.  It has to be printed, and we know this will impact world currencies and gold.

The Cyprus banking system was too big, it was about 7 times their GDP.  But we have the same situation in Switzerland, the UK, and Singapore.  If banks lose even 5% of their capital, they have lost all of their capital and they are bankrupt.  And most banks in the world already have unrealized losses in excess of 5%.

My view is that banks will have losses of 25% or more in coming years that they will have to recognize.  This means the world financial system will fail as central banks will be forced to print unlimited amounts of money.  Now the US banks are slightly smaller in terms of GDP, but of course the US has more derivative exposure than any other country.  I strongly believe the derivative exposure is more than a staggering $300 trillion, and US banks have no reserves whatsoever to cover the losses on these derivatives.

The other problem is that whatever happens in Europe will also impact the US because the global banking system is totally interconnected.  What is happening in Cyprus will absolutely spread to Spain, Italy, Greece, France, the UK, and eventually to the US.

At some point there will be panic, and this is when the central banks will flood the markets with unlimited amounts of money.  Japan is totally committed to money printing and so is the Bank of England.  Cameron has given the green light to the incoming Bank of England leader, Carney, and of course the ECB must print money because of all of the problems they have with the member countries.

What’s happening in the European economy is absolutely disastrous.  Countries are suffering tremendously.  If you just look at Italy, there are 1,000 companies going bust every day.  There is a similar pattern in Spain and Greece.  So Europe will print.  They will have to print with all of these companies going bust.

Bernanke will also continue to print, and with the US economy turning down he will print even more.  So as the governments print money, they will have to eventually recover it by grabbing the money from the people.  So they will, as in Cyprus, tax deposits.  That will happen worldwide.

They will also nationalize pension funds.  We’ve seen the nationalization of pension funds happen in several countries already and it will happen in Europe and the US.  They will also force depositors to buy government bonds.  It is also guaranteed that taxes will go up in all countries as deficits continue to soar.  So this will be a year of incredible turmoil.  This will be the year in which we see a major change in the world because the 100-year Ponzi scheme will really start to collapse in 2013.

The most important point I want to make is how absolutely critical it is for investors to preserve their wealth.  The crisis in Cyprus is yet another sign of the massive destruction of wealth that we will see in the financial system in coming years.

Investors must heed this warning and get their assets out of the banks now.  The reality is the financial system could fail at any time and this is why investors must act today.  See what’s happening in Cyprus:  Banks are closed and whether people have cash, stocks, or gold in the bank, they won’t get it out of there.

This is why back in 2002 we told our investors to put up to 50% of their assets into physical gold and silver, and also advised them to store it outside of the banking system.  The bottom line is that gold is guaranteed to reflect the massive money printing we will continue to see worldwide.”

Juga Gerald Celente, pendiri Trends Research serta banyak disebut-sebut sebagai seorang the top trend forecaster di dunia, juga memberikan penjelasan luar biasa:

“People always say to me, ‘Mr. Celente you are always talking about gold.  What are you going to do with gold when everything collapses and there is no money?’  Well, let’s say you are a Cypriot and all of the ATM machines are out of money and the banks are closed.  Do you think those pieces of silver are going to buy you what you need?  Do you think that ounce of gold is going to get you what you want?

That’s the real money.  There is no other money.  When it all comes down, gold and silver are the only things you have to buy what you need, get what you want, or even get out if you need to.”

Terakhir yang tak kalah penting adalah Tyler Durden dari www.zerohedge.com yang memberikan penjelasan dalam tulisannya yang berjudul: Is This The Diabolical “Master Plan” Behind Crushing Europe’s Depositors? Dan di bawah ini adalah jawabannya dalam laporan singkat:

“Last week, when we commented on the absolutely idiotic Euro group proposal (now voted down and replaced by an equally idiotic “bank resolution” proposal which will see uninsured deposits virtually wiped out) to tax uninsured and insured deposits, we jokingly suggested that this may be merely the latest ploy by the legacy status quo to achieve one simple thing: force depositors across the continent (and soon, world) to pull their money out of a malevolent, hostile banking system and push that money into stocks, or simply to spend it. This would help finally defeat the biggest bogeyman of the centrally-planned reflation attempt in the past 4 years – the absolutely dismal velocity of money which drops every time the G-7 central planners inject liquidity into stocks.

We were joking, because it would be beyond conspiratorial to suggest that a central bank could go as far as wiping out the wealth and savings of an entire nation in order to promote broken monetary policy. It would be outright idiotic and not to mention criminal. Why purposefully endanger depositors, and thus an entire financial system, just to spook them and their money? Or so we thought until we read the following just as “conspiratorial” take from Deutsche Bank’s Jim Reid:

Maybe the lesson from all of this is that if you are fortunate enough to have a fair degree of money you might be better off spending it! Maybe that’s the master plan here? Boosting activity by forcing people to use their money rather than deposit it! Indeed I wonder how long it’ll be before an equity strategist suggests that this is bullish as money might now leave deposit accounts and go into equities!

Sarcastic humor or sad, insolvent reality… You decide.”

Kesimpulan

Pada akhirnya kita semua akan sangat mudah melihat dengan jelas bahwa ini semata adalah penyelamatan euro, bukan Siprus. Dan kembali Tyler Durden memberikan penjelasan gamblang mengenai bagaimana akhir dari semua ini:

“Alas, it is not just in Cyprus that the current failing status quo has become the USSR incarnate: one can see it in the central planning of the stock market, in the general approach toward the wealthy, in the absurd penetration of cronyism and the terminal corruption of the system.

And while we commiserate with the simple people of Cyprus (and soon everywhere else), who have for no fault of their own become the first pawns to be sacrificed in the systemic endspiel, we are grateful to Europe for proving us, once again, correct.

Because our only purpose with this media experiment has been to warn our readers that concentrating unlimited decision-making power in the hands of a very few conflicted individuals, without checks and without balances, always, always, ends in absolute disaster, bloodshed, and ultimately war.

Sadly, at this point there is nothing that can change the final outcome of what is an ongoing systemic failure.  One can, at most, prepare as much as possible and hope for the best.”

Kemudian Jeff Thomas dari International Man juga memberikan keterangan menarik mengenai implikasi dari krisis Siprus:

“Cyprus is only the first domino.  There will be others.

Other dominoes will surely follow – just as surely as the contamination will spread across the pond to North America.  The fact that the tipping point began in Cyprus, rather than, say, Greece or Spain, is incidental.  Of all the dominos slated for demolition, it is unimportant which country was the first to set the dynamite charge at its foundation.  The end result will be contagion, as all other options have, predictably, failed.

As investors, if we are to do well, we must concentrate on becoming a giraffe, as visionary investment advisor Harry Schultz used to say.  We need to get our heads up to a height where we can look at the overview of the situation, see the landscape below us, and know what’s coming in the broad sense.  This gives us an understanding of the events to come.  If we do this well, events such as the recent ones in Cyprus come as no surprise.  They simply tell us to look ahead to the next domino to await its fall.

By so doing, we can plan ahead when to make our moves – to make them before the events occur, instead of “chasing the events.”

Terakhir, seperti biasa saya akan menghadirkan sejumlah gambar lucu dan pantun jenaka dari William Banzai, yang bisa mengundang senyum:


The climbers were reaching the peak

When out shot a terrible shriek

The climbers all fell

They landed in hell

The Dutch guy decided to speak

The Limerick King

Collaboration with @blumaberlin

The machine states what everyone knows
The whole Euro zone has no clothes
In Cyprus they’re crying
Their banks are all dying
Soon all of their funds will be froze

The Limerick King

Dibuat Tanggal 12 April 2013

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