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Special Up-To-Date Interview: Silver Expert, Ted Butler

By: Ted Butler

-- Posted 28 January, 2004 | | Source:

Q What do you think about the price rise?

A Itís very interesting because this price rise has been concurrent with my raising of some issues about certain large financial companies in early December. The price rise has coincided with my articles about them.

Q You donít think this is coincidental?

A Not when silver is 70Ę higher since then, while gold is unchanged.

Q Are gold and silver divorcing?

A I think thatís the case.

Q Youíve said it has to happen sooner or later, right?

A Itís inevitable because weíre running out of above-ground silver and weíre not running out of gold.

Q Gold isnít going up?

A Gold can go up, itís just at some point silver has to greatly outdistance gold.

Q Most people think theyíre tied together and will only rise when the dollar falls. I take it you donít agree?

A I think theyíre wrong. I donít see the dollar having that much influence on silver.

Q Silver is up 60% or so, but it hasnít been the kind of price explosion you envision. Why not?

A We havenít really altered the paper short position on the COMEX. Silver will only explode when the paper shorting game ends.

Q How will that come about?

A It appears it has already started, and the large commercial dealers seem to be losing their appetite for the short side.

Q What do you mean?

A During the price rally last fall we didnít see the usual super aggressive, concentrated short selling by the big dealers.

Q Explain that a bit more?

A The big shorts didnít sell as much on price rallies as they did in the past.

Q Why would that be?

A I think theyíre starting to sense just how dangerous a short position in silver is going to be.

Q So, what happens if they cover?

A We explode.

Q Would you care to put a number on that?

A When the dealerís rush to cover, itís going to lead to shockingly higher prices.

Q Youíre avoiding getting specific?

A A quick run to double digits.

Q With more to come later?

A With a lot more to come later when the users panic and attempt to build inventory, as they must.

Q Where does China fit into the current equation from the demand side?

A Theyíre the major focal point, as they are in many commodities. Theyíre going to consume massive amounts of silver.

Q Does this have much to do with the current price rise?

A Maybe indirectly. However, I donít think supply and demand is influencing this market yet.

Q Why?

A Silver is still manipulated.

Q But you seem to think theyíre starting to lose their grip?

A Yes, but that doesnít mean that the dealers are not going to try and rig selloffs in order to get the tech funds to sell. So we still have to be ready to take advantage of that.

Q Could the current slow and steady price rise continue?

A I donít know. What I do know is when the dealers go to cover their short position there will be no gradual price rise. It will be straight up.

Q I assume that means you still think silver is a buy?

A The buy of a lifetime.

Q Of course, when it gets as expensive as you think it will eventually be, itís too late to buy it?

A Exactly. The higher the price, the less the profit potential and the more the risk. Donít wait for price confirmation to time your purchase.

Q So, now is still good?

A Absolutely.

Q Care to put any time frame on this coming price action?

A Soon enough.

Q As closely as you study the market, are you seeing signs that the things you predict are starting to unfold?

A Iím seeing continuing signs of that. I also donít see any signs whatsoever that would negate it.

Q Thatís an interesting point. Care to elaborate?

A In any objective financial analysis you always want to consider where youíre wrong and whatís the opposite side of the equation. Iíve always looked for those arguments that would suggest silver is going lower in price. Iíve never found one, and thatís especially true now.

Q What about this bearish argument that silver will come out of the woodwork at higher prices and mining production will increase.

A Thatís funny. The most bearish argument that anyone can make only kicks in at a higher price. Letís worry about those issues when we get much higher prices.

Q Youíve been proven right so far. Is that pretty gratifying?

A Iím glad that nobody lost money as a result of what Iíve written. Not losing is important.

Q Are you comfortable still advocating silver?

A Absolutely. All the things Iíve pointed to as being extremely bullish are still on the table.

Q Do you think weíll eventually set a new high in the price of silver?

A Count on it.

Q Thanks for your latest update.

-- Posted 28 January, 2004 | |

This article is brought to you in part by Investment Rarities Inc.

Last Three Articles by Ted Butler

Warnings Ignored
4 September, 2009

The Voice Of The People
25 August, 2009

Walking the Walk
20 August, 2009

Ted Butler - Article Archive List is presented to you by:

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