by Aaron Krowne
Nice try, CPM group.
In their latest made-for-Kitco statements directed at debunking “silver market conspiracy theorists”, CPM group accidentally bolsters the case that a silver shortage is developing and is likely to spread to the entire market (and the prevailing silver price).
In the remarks, CPM essentially admits there is shortage in investment silver products, but assures calm, because it hasn’t appeared in the industrial silver market. Investment demand, which is the sector from which the demand spike is originating, does not consume silver in “sponge” form.
The fact that the shortage is manifesting mostly in investment-form silver, but not in industrial, is not at all surprising.
Things may appear “calm” right now (and no one is disputing that there is no industrial shortage — yet). The real problem will be when new fabrication of investment silver does finally ramp up more, and starts rapidly stealing feedstock from the industrial segment. THEN it will start putting pressure on the industrial supply, hence creating price rises, in turn creating a feedback effect.
(Hey, maybe it has already started, especially with today’s $31.80 closing price).
So in fact, the condition described by the CPM group as occuring now is EXACTLY what you’d expect to see as a precursor to an all-out shortage. As a “silver conspiracy theorist”, I bid you thanks, CPM group!