The Phaserl


MARKET DATA PROVES: Overwhelming Public Demand For Silver Eagles…. Not JP Morgan

from SRSrocco Report:

According to global market data from the top Official Mints, sales of Silver Eagles  originate overwhelmingly from public retail investment demand rather than by one large bank… such as JP Morgan.  I say this in response to the allegation put forth by silver analyst, Ted Butler who believes JP Morgan purchased half of all Silver Eagles since April, 2011.

Ted Butler, who has made this claim over the past several months, does so again in his recent article, The Perfect Crime.  Butler states the following:

For starters, there is the matter of extraordinary sales of Silver Eagles from the US Mint. Since April 2011, the US Mint has produced and sold 140 million Silver Eagles, more than in any similar period of time, in a price environment that can only be termed putrid and in which sales of Gold Eagles were notably lower. I would estimate that JPMorgan purchased close to half of the 140 million Silver Eagles sold since April 2011. According to very reliable sources on the retail front, general investment demand has been lower over this time, as retail buyers do not buy strongly into a declining price environment in any investment asset. Yet we know for a fact that there has been extraordinary buying of Silver Eagles, even while Gold Eagle sales cooled off notably, so someone had to be buying Silver Eagles.

Butler assumes JP Morgan purchased half of the 140 million Silver Eagles produced since April, 2011… and he believes this to be true because “According to very reliable sources, general investment demand has been lower over this time.”

This is where I disagree with Butler.  Now, let me start off by saying it was Ted Butler’s writing back in the early 2000’s that motivated me to start buying silver.  So, I have a lot of respect for Ted as he was one of the leading silver analysts writing about the shiny metal well before it became on the public’s radar.

While I believe there is significant manipulation in the precious metals markets (including most other markets) by member banks, I do not agree with Butler that JP Morgan purchased nearly half of all Silver Eagles since 2011… and I believe I have the market evidence to support my claim.

Top 3 Official Coin Sales Support Broad Based Public Demand

If we look at the top 3 Official Coin sales since 2008, we can see a similar overall trend.  Let’s first take a look at the U.S. Mint sales in the chart below:

U.S. Mint Silver Eagle Sales 2008-2013

As the price of silver skyrocketed, U.S. Mint Silver Eagle sales increased from 19.5 million in 2008 to 39.8 million in 2011.  However, as the price of silver declined and remained flat in 2012, demand for Silver Eagles fell 15% to 33.7 million.  Then in 2013, U.S. Mint sales hit a new record of 42.6 million as investors took advantage of sub $20 silver.

Butler alleges that as JP Morgan drove down the price, it purchased half of all Silver Eagles at a steal.  Well, if this was the case, then who was buying record sales of Silver Philharmonics and Silver Maples??   If we take a look at the next two charts, we can clearly see a similar trend in these two 0fficial silver coin sales:

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11 comments to MARKET DATA PROVES: Overwhelming Public Demand For Silver Eagles…. Not JP Morgan

  • Eric B

    Why would JPM buy 1oz coins? not making any sense when the premium is so high, if the big 5000 OZ odd weight bars that are delivered on the exchanges suddenly evaporated…..then I would know the end is near…..1oz coins…..probably not a big entity buying them just an idiot like myself……signed unhappy Silver Baron

  • Gnostic

    If the story is true perhaps they are melting them into bars? or keeping them out of the hands of the masses? i remember the oracle Warren Buffet selling 130M oz’s & missing out on a windfall profit, probably under pressure from JP Morgan.

    • Ed_B

      My guess is that Buffet swapped that silver holding for a seat at the table for “those who matter”.

      I am fascinated by the fact that Warren’s father, Howard, was a huge fan of a gold money standard. He wrote eloquently about that in a 1948 speech he delivered while still a congressman. He believed that gold in the hands of the people was a powerful blocking force against massive government over-spending and that without circulated gold money, there would be no significant restraint on the spending of vote-grubbing politicians. You can find this speech on-line by doing a search for “Howard Buffet gold”. It is a 3-4 page PDF file that can be downloaded. It’s very well worth the time it takes to read. Afterwards, you will wonder how Warren can be so anti-gold, given this lineage.

    • Howard Roark

      No, his life was likely threatened and he was promised sweetheart insider deals in exchange…GUARANTEED

  • AK

    I still find Ted Butler’s claim to be credible that JPM has been heavily shorting paper silver to accumulate physical on the cheap. It is debatable how many silver eagles, vs. 1000/oz bars they may have accumulated. They likely are doing both and clearly they are doing it in a way where it can’t readily be traced back to them, since that would in fact be criminal.
    I have no doubt that JPM knows that the paper Ponzi is coming to an end sooner or later and they know better than anyone that they will need plenty of physical assets that can be collateralized when the time comes. In the meantime they will continue to drive down the price and accumulate as much as they can at the lowest possible price for as long as the physical market is still intact.

    • Ed_B

      Nothing is criminal until the Attorney General of the US says it’s criminal. Those in the inner circle get a free pass to do just about any damned thing they want. Just ask Jon Corzine how that works. Then ask Bernie Madoff how it works when one is not a member of an elite circle. IMO, these were the same acts that had VASTLY different results for those involved.

  • Scott Wolf

    Just another head fake to deter the sheeple from taking precautionary measures to protect themselves once the current system crashes again. Prop trades and naked shorts don’t require actual assets to be traded. Moreover, any metal moving quietly through the system is making its way East not to some Western Bank vault. A few billion in silver bullion coins will not save JPM from its $68.3 trillion in derivatives exposure backstopped by only $2.5 trillion in assets- 30:1 leverage. Assuming Ted is right(I don’t think he is), that metal was used to settle delivery contracts.

    I see more of the same in 2015, as nothing has or will change.We’ll continue to see the clash between irrational monetary policy and the free market’s economic reality, a bear market in paper precious metals, a bull market in physical precious metals, and quixotic, dislocated housing, stock, and bond markets that can break apart at any time. Caveat Emptor, fiat junkies.

  • Save_America1st

    both theories are probably right to some degree. And we should be very thankful to all analysts and writers like Ted and Steve who put their analysis together for us.

    So as I said, at the same time I believe they’re both right. Plain fact of the matter is that there are huge buyers of size, no matter whether they’re bad guys like JP Morg and others, good guys like Eric Sprott, or us little good guys who are scooping us as much phyzz as we possibly can while the scumbag, criminal cartel forces “paper” prices down for all of us, right???

    So Ted and Steve are right. And we just need to stay on our own individual course of buying when we can with what we can as it fits our own individual budgets, that’s all.

    I thank Steve, Ted, Turd, Harvey, Dubin, Denver Dave, GATA, Koos, and hell, all the others who we all follow who are able to talk to each other and write stuff for us and do videos and podcasts for us who help all of us understand as best we all can as to what’s going on with the PM’s.

    This has been a great year for us stackers whether we’re little guys or the big scumbags, right??? We got to stack cheap phyzz due to their criminal manipulations.

    I’m sorry, but since I haven’t been stacking and trying to wake others up for more than the last few years I’m very happy with this situation. And I don’t give a rats ass what the prices is anymore from here to 10 bucks or here to 200 bucks. We all know it’s a lie and that it’s actually PRICELESS!!! Right???

    Fiat dollar price ultimately is a total lie with all phyzz PM’s! So we shouldn’t care what it will ultimately go UP to, right??? That only means another manipulation in fiat fake paper price and we already know that’s a lie, so why would we care about their fake numbers attached to our precious phyzz???????

    It’s about perception and situation. Down the line…years away…our phyzz will be traded for very valuable things outside of the fake fiat system.

    Maybe 500 ounces will get us a huge chunk of nice farm land with a house and all the gear we need. Whatever….who knows. I don’t know.

    But I do know it’s infinitely worth more than paper of any kind that some scumbag prints.

    I hope you all remember that.

    Happy New Year!

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