Reuters Bamboozles the public, dedicates hit piece to silver

In an article Thursday, entitled silver: poor man’s gold turning to fool’s gold, Reuters warned silver bulls against their own optimism at the metal’s strong first-quarter price rise. The piece reads:

“Its advocates say silver, which occupies a middle ground between industrial metals like copper and investment vehicles like gold, can benefit both from the fledgling economic recovery that is lifting copper and from the investment that is driving gold.”

Coyly so, Reuters degrades silver from the status of precious metal—as it has been for thousands of years—to a a sub-precious metal or even premium-base metal. This “middle ground” that Reuters maintains exists is an imaginary space conjured up by the propagandists of news-speak, who, like Winston Smith of 1984 before them, remake reality in the powers-that-be’s own image. Silver is a precious metal, and one which has served civilization as money for milennia. There’s no good reason to discount it now, except when blinded by the holy-lie of fundamentalist dollarism.

The article continues with its hearsay obfuscation:

“But record-high mine supply and questions over demand have left a long shadow over silver’s underlying fundamentals, while huge price volatility last year, when the metal crashed 35 percent in a matter of days on two occasions, has undermined its appeal to investors as a cheaper alternative to gold.”

Conveniently, the compliant one leaves out that, when measured on any chart longer than the past year, what one finds is a metal that has remained resilient, despite the volatility inherent to it. The compliant one, bullshitting life away, also leaves out the true reason there has been “left a long shadow over silver’s underlying fundamentals,” and that is rampant market manipulation in the silver market.

Paper contracts, placeholders for the metal, have substituted for the actual thing, physical silver. It’s as if believing that paper representations of food will somehow feed you and your family. But the benefits of food stamps, as we all know, is not the card itself, but what that card can make tangible. And so, commercial hedgers who sit below the zero contract level, like hell below the continents, dictate the price of the metal and its price action.

This price action is the prime reason for the dismal view of silver on the part of sheepish investors. They have been scared away from it by its scientific, command-and-control price discovery; that is, the manipulation. Since April 2011, almost as soon as the metal begins a run, a dip more violent than the rise ensues, scraping away any recent gains.

Recently, as silver ran from the low thirties to the $37.50 level, Ron Paul questioned Bernanke, bringing to light inflation and the deterioration of the standard of living the average individual experiences. He mentioned silver, and, assuming Mr. Paul’s phones were tapped—which they likely were—one of the topics of his speech, a Silver American Eagle in his hand, inspired a bludgeoning of the metal price in dollars during the speech.

All its recent gains were unrealized and still today it sits dormant, below its price from one year ago. But, priced in the low thirties, the price of silver stands almost 50% higher than its pre-2008 banking crisis price of approximately $21.

“There are two issues that in the short term suggest we are not going to head back towards $50,”Mitsui Precious Metals strategist David Jollie said. “One is that margins on Comex are still higher than they were last year, so investors are going to have to come back in more weight to drive the price further.”

In this quote here, allusions to the command-and-control dynamics stomping on the market are made, but generally speaking the piece does little to explain and shine light on the manipulation.

Any prices rise in the metal is attributed to its volatility, and not the probability that the metal, eventually, will adjust for inflation. Investors “are going to have to put in considerably more effort to reach the same levels as last year,” Jollie said. In 1980, silver reached a record of $50, which, adjusted in present dollar terms, represents between $120 to $150 per ounce.

Silver’s behavior is used to lend credibility to claims that the economy is on an upswing, and that the Untied States might have magically dug itself out of a recession amidst global governmental, environmental, food and military crises. Falsely, considering its price and the amount of manipulation (sometimes more than a third of the year supply of silver is sold by “commercial hedgers” or behemoth banks, setting the scene for a flash crash of the silver market), Reuters uses “experts” to imply we are heading back towards the “normal situation:”

“Now we are back to the normal situation, where silver behaves much more like industrial metal. Investors are no longer looking at it as a safe-haven asset,” he said. “It will probably under perform for a good few years.”

If there is truth to the first premise, that silver is now behaving more like an industrial metal, it is an artificial state. If silver is acting as an industrial metal, it is being forced to do so by players in the paper market. In other words, if left to natural price discovery, there’s no way it would behave as an industrial metal. Instead, it would first skyrocket in an adjustment for inflation, and then be left to a new demand spurred by the monumental price action and the global economic crisis expanding.

Considering sales of the metal remain steady, not to mention chatter on the internet, it is highly unlikely that “investors are no longer looking at it as a safe-haven asset.” The reality is that, whilst commercial enterprise has not looked to the metal as a store of savings or a safe-haven ever, the poor classes to the nouveau riche do see it as such, and their demand for the metal is unlikely to be shaken from the branches of the silver market. Wherefore? Well, much of this buying base is an informed buying base, and have not been led to silver by brokers and money managers employed by the keystone corporations of planet earth, the ruling class. They have rather been brought to the silver market via their own due diligence. And that miners continue to produce record amounts of silver seems to add to the case that silver demand is skyrocketing.

At the end of article, Reuters leads its lead to believe that “gold is the better place to be than silver.”

But, it is generally understood that gold is competition for the dollar. And, since Reuters, like all mainstream outlets, is a mouth-piece of the power-structure what would lead them to recommend gold?

Or is the better question, what would lead them to lead you away from silver?