Gold to Silver Ratio at 47.59

On 23 November 2006 the Gold to silver ratio (Gold/Silver or Au/Ag) was 47.59 with gold spot price at $628.60 per ounce and silver spot price at $13.01 per ounce.

I stand behind my prediction that the gold/silver ratio will one day approach 1.00 and then move to 0.17!

Signed and affirmed by Gerard LeBlond on 23 November 2006.

I Stand by My Prediction of 21 June 2006 Regarding the Impending Gold To Silver Ratio Flip

What About That Gold To Silver Ratio Flip Prediction?

Gold / Silver Ratio on 24 July 2006 = 56.59

Gold spot price per ounce = $612.90
Silver spot price per ounce = $10.83

According to my sources there appear to be a small number of very powerful traders who are selling short huge amounts of silver.

These traders (could be a single entity) are selling short naked insofar as they do not have the silver to back their positions.

Eventually, like a toddler playing with fire, the market manipulators will get burnt.

And when that happens, and if the injury is severe enough... the market manipulation will cease and the free market prices for silver will go stratospheric...

That is my prediction of 21 June 2006 and I hold to it as of this date: 24 July 2006.

See you on the moon, baby...

Oh, and don't forget to gas up that rocket ship if you want to keep up with the rising silver prices that are to come.

Tags: silver silverprices prediction Ag gerardleblond leblond gold Au freemarket freemarkets marketmanipulation

CFTC Commissioners Need To Be Fired & Roasted On The Spit

CFTC Directors Neglecting Their Duties With Respect To The Silver Market

The silver market has been and is currently being manipulated. As a consequence, silver prices have been kept dirt cheap for decades.

This is both good and bad.

The good part: with "below free-market" price levels, silver is cheap to buy. In fact, it's a lot less expensive to buy pure bullion silver (Ag) than it is to mine the stuff out of the earth, purify it, assay it, pour it into ingots, weigh them, mark their weights and place a serial number on each bar.

But the flip side (the bad part of the silver price manipulation): holders of bullion silver, silver coins and silver artifacts have to continue waiting before selling their silver else they sell for less than what the true market price would be if a truly free market was determining silver prices.

Silver Analyst Theodore (Ted) Butler says:

In my opinion, and only the CFTC and COMEX know for sure, the bottom line
true open interest in silver futures, minus all the spreads, is under 66,000
contracts. If I am correct, the 4 largest traders control 54% of the entire
market and the 8 largest traders control 67% of the market on a net basis, not
the 36% and 45% amounts listed... This is outrageous and clear proof of
dominance and control and manipulation.

A silver contract is for 5,000 ounces of the metal. So the open interest in silver futures affects 330,000,000 ounces of silver (directly) but indirectly affects the market price for all silver.

The manipulation has occured primarily by deep pocketed market traders who create paper contracts (options) in which they agree to sell a certain amount of silver by a certain time in the future at a price that is less than the current market's spot price at the time the contracts are written. This is known as short-selling and it has the effect of depressing the price of silver. If sufficient short-selling occurs it can push the price of the "shorted" item down.

From my understanding, many informed individuals have complained to the CFTC about the silver manipulation. But the CFTC has ignored the warnings.

If a real manipulation is occurring, and the evidence clearly indicates that it is, the CFTC should and must step in and investigate the situation. So far it looks like the CFTC is looking the other way. If the CFTC is indeed side-stepping the Silver manipulation matter then the ultimate responsibility lies with the commissioners for failing to uphold the mission of the entity that they are obligate to oversee. But, if the CFTC refuses to act...

There's one way to get the free market to pop back into action... and that is for silver investors to purchase and take physical possession of silver...

They should buy as much as they can, as often as they can because it is to their advantage insofar as the silver prices are currently low. And those prices will continue to remain low until the short-sellers are forced out of the market.

Time will tell.

Oh, by the way...

Did I neglect to add that the Commodity Futures Trading Commission (CFTC) has the mission of protecting market users and the public from fraud, manipulation, and abusive practices relating to the sale of commodity and financial futures and options, and to foster open, competitive, and financially sound futures and option markets?

I thought you'd like to know.

Respectfully,

Gerard LeBlond

What To Do With 20 Million Dollars Burning A Hole In Your Pocket

It was a confluence of highly unlikely positive events...

Some would call it the cross-over point. Others would call it unbelievable luck.

The combined total of his (we'll call him Mr. "X" to preserve his anonymity, privacy and "wish to be left alone") lottery winnings and the inheritance from a long forgotten rich uncle (whose estate was finally closed out 12 years after the death of the benefactor) was a cool $20,000,000 (rounding down a couple hundred thousand) and that was all "after taxes"!

You should be so lucky.

Not having any experience with managing such bountious riches he sought out a financial planner. But that in itself was a task and a half because entrusting one's fortunes to an unknown entity could easily be a "good-bye" kiss to the new found riches and "hello once again" to the old grind-stone... So,

He approached his trusted lawyer and asked her to query her 5 most respected colleagues for the names of the 3 people each would go to if they needed financial advice.

She came back, a week later, with 5 envelopes... each containing 3 names.


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Of those 15 suggestions 9 were unique names. Six of those were suggested once, one was named twice, another was suggested three times and one was suggested by 4 different recommendors.

Mr. "X" made separate appointments with the three candidates who had multiple recommendations.

He asked each a battery of pre-arranged questions and requested the names of 40 of their best clients and 10 of their "nightmare" clients.

Of each collection of "40 best clients" he chose 5 at random and called each of those. He had a short list of questions that didn't take much time to cover. He recorded the conversations and had the recordings (permission for recording the calls were obtained in each case) transcribed and from the transcriptions he made short notes in the margins.

He also interviewd 2 randomly picked "nightmare" clients from each financial planning candidate's list.

From his research he narrowed down the list of candidates down to two.

He then sent individualized letters to each of the nine original candidates asking them to rank the other 8 candidates and to mention which one or two they would hire to take over their own family's financial affairs if he/she were not capable of handling it any longer.

In the end one solid candidate stood out from the rest and it is this person that Mr. "X" hired as the finance-person on his "Mastermind" team. Together they came up with an amazing plan...

Together they lined up a precious metals commodity broker.

Mr. "X" short-sold 100 contracts (where each contract represents 5,000 ounces) of silver at $2.00 per ounce less than the current spot price for silver.

This had the effect of pushing down the price of silver.

He then bought enough shares from Barclay's ETF (exchange traded fund) to equal 500,000 ounces of silver.

He then arranged for the Brinks Security Service to drive an armored vehicle up to the loading docks of Barclay's warehouse and he asked to redeem his 500,000 ounces of silver. The silver bullion (in 500 or so bars of 1000 oz... because each so-called 1000 oz bar is not exactly 1000 ounces... some are only 980 ounces and others can weigh as much as 1030 oz plus or minus) was loaded into the armored vehicle and delivered to a secure warehouse facility. Each bar's serial number was recorded and the numbers were given to Mr. "X" as his proof of ownership.

Then he closed out his open "short-sell" position and waited for the price of silver to dip again.

Dip-again?

Absolutely... you see, after word got out on the stree that the ETF had less bullion in its vaults (after Mr. "X" redeemed his ETF shares for real silver bullion) people erroneously thought that silver wasn't that great of an investment... so,

The price fell about 20% at which point Mr. "X" immediately bought enough ETF shares equivalent to 500,000 ounces of silver.

With shares in hand he redeemed his silver from the ETF once again and ended up with 1,000,000 ounces of silver and, when all the dust had cleared, he still had about 9,800,000 in cash safely stored, in 100,000 dollar lots, in 98 separate bank savings accounts.

So, that's how he picked up a million ounces of silver below prevaling spot prices and time will tell how he and his new financial planner will deal with the remaining cash portion of Mr. "X's" portfolio...

Gold To Silver Ratio Flip Prediction

Every now and then something happens that stops you dead in your tracks.

Perhaps it is something of incredible beauty... a stunning sunrise or sunset.

Maybe it is the birth of a child... a sibling... a son/daughter... a grandchild.

It might be an outstanding work of art... like standing inches away from a Matisse, a Monet, a Raphael, a Michelangelo or Picasso.

Of course, being unique, we each react differently to any particular stimulus.

Johnny, for instance, can't stand cold water while Jimmy, on the other hand, can splash around in the stuff as though he were raised by an Antarctic penguin family.

We each have our own likes and dislikes and we each respond differently to similar environmental conditions.

Having said this let me make a bold prediction... but be forewarned...

Some will find this of particular interests, some won't care a wit (they've already stopped reading several paragraphs ago), and others will poo-poo the idea. The reaction is to be expected but what I am about to divulge is not...

I predict that in the not too distant future... it could be a year from now or ten years... the gold to silver ratio will flip.

What does that mean? Good question. Let me explain.

The gold to silver ratio is the price of 1 ounce of gold divided by the price of 1 ounce of silver.

Historically it hovered around 40 to 1. So when gold sold for $40 per ounce silver could be had for about $1 an ounce.

On 21 June 2006 the gold to silver ratio was around 56.2 since gold was selling on the spot market at $575/oz and silver at $10.24/oz.

Now, consider the following...

Little known fact: silver is rarer than gold.

Another little known fact: "mined" (above ground) silver supplies are being used up and gold supplies are growing. There's a significant industrial demand for the former but a negligible industrial demand for the latter.

One more little known fact: the price of silver is not currently driven by free-market forces but are, and have been for years, being manipulated by deep-pocketed entities (financial institutions, market makers, brokerage houses,...) through short-selling and leasing agreements. But...

It looks like the manipulation of silver prices may eventually come to an end.

When the free-markets determine silver prices you will find that the existing silver shortage and high industrial demand for this precious metal will push the prices sky-high. So much so that the gold to silver ratio, in my opinion, will fall from its current level of 56 down to the historical level of 40 and then down past 30... 20... 10... 5... and 1.

At that point, when the ratio is 1.00, the price of silver will equal that of gold on an ounce for ounce basis. And...

I don't see the downward trend stopping at 1.00. No, no, no...

That 1.00 figure isn't like a brickwall that will prevent further downward movement... it is only a number and that number isn't going to have any effect on the downward ratio movement and that number is not going to last long. It will be fleeting...

Because, when the ratio of gold to silver prices falls, just a fraction below 1.00, it will be at that precise moment when the gold to silver ratio will have flipped... Meaning...

That silver will be worth more per ounce than gold and I further predict that the gold to silver ratio will drop to 0.33 or lower.

When that happens you can kiss good-bye to the gold-to-silver ratio and you can say "Hello" to the silver-to-gold ratio.

Yes folks, the "silver-to-gold ratio" term will be born because precious metal investors are use to dealing with "big number" ratios instead of "small number" ones.

When the gold-to-silver ratio is 0.33 the corresponding silver-to-gold ratio will be 3.

That is my prediction...

The date on which this prediction was penned is 21 June 2006 and I stand by it...

My name is LeBlond, Gerard LeBlond and I'll see you on the flip-side of the gold-to-silver ration....

Or should I say: the upcoming "Silver-To-Gold" ratio....

gold/silver price ratio could flip

The gold to silver ratio is the price of an ounce of gold divided by the price of an ounce of silver.

If the price of gold equals $633.46 per ounce and silver goes for $14.41 per ounce a simple calculation yields a gold/silver ratio of 43.96

Some time, within the last couple of years, Ted Butler wrote: "gold sells for more than 60 times the price of silver". That corresponds to a gold/silver ratio of 60.00.

Around the middle of April 2006 the ratio fluctuated pretty tightly around the 44.00 level plus or minus a couple of dollars.

Throughout most of history, 12 ounces of silver could be had for an ounce of gold... with 12.00 being the historical gold/silver ratio. Then, around 1700 A.D. the ratio bumped up to 16.00 (i.e. 16 oz of silver would trade for 1 oz of gold), and stayed at that level for 160 years. Then, in the latter part of the 1800s...

The Comstock Lode was discovered and silver became very plentiful and the ratio went to around 40 (40 ounces of silver would buy 1 ounce of gold).

But today silver supplies aren't like they were up until a hundred years or so, and silver has an industrial demand which gold does not.

Silver, in fact, is more valuable than gold, it is more useful than gold, and it is in higher demand than gold and...

There is only about one fifth "above ground" silver as there is gold.

The claim that there is 5 times more gold than silver has been made by Theodore Butler... and, if it is correct, then don't be surprised if gold to silver price ratios, begin moving not only closer to 16 (from the current 44 level) but eventually approaches 1 oz of Gold per 1 oz of Silver.

Don't be surprised if the ratio will approach and then equal 1.00. And...

When and if this happens, don't be alarmed to see ratios approaching 5 oz of Gold per 1 oz of Silver (i.e. 0.20).

I call this process the "flipping of the Gold to Silver price ratio". It has never happened, to my knowledge, in the course of history... but then

Silver stocks have never been as low as they are now and they continue to be depleted.

So, while a flip of the ratio has never occurred don't bet that it can't and won't happen and...

When it does occur everyone who owns real silver will be very pleased with their ownership position.

Respectfully,

Gerard LeBlond
President
SellinfoProductsOnline.com

Real Value Of Money And Barrel Of Oil Cost

In January of 1981 the price for a barrel of oil was $38.75.

Realize that we are talking about the price for a barrel using "1981 dollars".

If we figure out what that price translates into, using real, inflation-adjusted dollars, that 1981 barrel of oil would cost $86.71 in today's dollars.

Now consider this...

On 20 September 2005 the spot price for a barrel of crude oil in 2005 dollars was $65.90!

So, are crude oil prices high today versus historical prices?

Not when you look at the numbers using real, inflation adjusted dollars and...

Not when you realize that there is a heck of a lot less crude supplies (buried and above ground) today than there were back in 1981.

Because of efficiencies in transportation and processing we've been able to bring down the cost of a barrel of crude oil even while supplies where diminishing.