Maguire - Shocking $2.89 Premium For Physical Silver In China

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2012/12/21_Maguire_-_Shocking_%242.89_Premium_For_Physical_Silver_In_China.html

Maguire - Physical Silver Market Has Now Diverged To Extremes

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2012/12/20_Maguire_-_Physical_Silver_Market_Has_Now_Diverged_To_Extremes.html

Leeb - Supply Crunch To Send Silver Into The Stratosphere

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2012/8/21_Leeb_-_Supply_Crunch_To_Send_Silver_Into_The_Stratosphere.html

Physical Silver Surges To Record 30% Premium Over Spot, In Backwardation

http://www.zerohedge.com/news/physical-silver-surges-record-30-premium-over-spot-backwardation

If Silver Goes Down All Hell Will Break Loose In The Physical Market: Silver Investment Update

http://youtu.be/xCCuLMgyUgY

Sprott Money Temporarily Runs Out of Physical Silver

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2011/9/23_Sprott_Money_Temporarily_Runs_Out_of_Physical_Silver.html

The Death of Liquidity

Ted Butler has been on  the silver bandwagon for over a decade.  And he's been spot on. 

http://news.silverseek.com/SilverSeek/1315318111.php

Scotia Mocatta Loses 60% Of Its Physical Silver In One Month To "Reclassification", Total Comex Registered Silver Now Under 30 Million Ounces

http://www.zerohedge.com/article/scotia-mocatta-loses-60-its-physical-silver-one-month-reclassification-total-comex-registere

JP MORGUE INCREASES PHYSICAL SILVER IN NEW VAULT 39% IN 2 DAYS!

As I suspected, JPMorgan needed to load up on physical silver to meet future delivery obligations.  How to do it?  Drive down the paper price of silver and force physical liquidation out of SLV vaults.  Oh, and by the way, JPMorgan is the the custodian for SLV! 

http://silverdoctors.blogspot.com/2011/05/jp-morgue-increases-physical-silver-in.html

If the price of silver has plummeted, there should be a flood of supply out there, eh?  Well, look at Scotia Mocatta's website for silver products.  ScotiaMocatta is Canada's biggest precious metals dealer. 

https://www.scotiamocatta-estore.scotiabank.com/stores/scotiamocatta/catalog/catalog.aspx?nst=GXLqF7%2bdXVntKnBaWPeeeTETwfkd7uVq

As of today, they are sold out of every silver product--except for the 5 oz. bar.  This is more evidence that there is a shortage of physical silver, and that the paper prices at the COMEX do not reflect the reality of this shortage.

Paper vs. Physical Silver Prices

With silver prices plummeting at the COMEX, the price of physical silver hasn't dropped as much, creating a huge premium for physical bullion over spot price.  This is what silver bugs have predicting, as physical shortages don't follow the price manipulation of the paper markets.

Having said that, silver's stratospheric prices have encouraged scrap supply to come on-line.  Hence, prices for physical bullion (and coins) should drop relative to the COMEX futures prices over the next several weeks, shrinking the current premium over spot.  A period of consolidation to digest the incoming scrap supply is in order, with silver trading within a range, setting up for its next move above huge resistance at $50.  If it holds above the nominal all-time high, it's onward and upward with no meaningful resistance above $50.  Silver would then merely catch up to gold's record-breaking bull market.

See disclaimers in the side bar.

Disclosure:  long silver mining shares.

Eric Sprott - “Sprott Has More Physical Silver Now Than Ever!”

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2011/5/3_Eric_Sprott_-_Sprott_Has_More_Physical_Silver_Now_Than_Ever!.html