Silver ETF Isn’t 100% Real

David Morgan, one of the world’s foremost silver experts, weighs in on the silver ETF, “SLV.” (Edited for brevity.)

David MorganBarclays changed the words in the original prospectus from “Silver Bullion” to just “Silver,” which reading as a lawyer would, begs the question Why? To me it implies there might be other silver investments that count but are not necessarily bullion.

Knowing that the SLV is ALWAYS cash settled should raise an eyebrow or two. Under no circumstances do I consider it to be a silver investment. It, as with a mining stock, futures or options contract, or anything else that you do not hold in your own hand, is a derivative!

Also, as has been pointed out on the Internet before, SLV added 20 million oz of silver to their “inventory” on December 31, 2007, only to remove it on January 1, 2008. Either they hired an entire fleet of armored cars for two days or that silver was a paper scheme all along.

It is impossible to move 20M oz of real silver that quickly, not with all the checks and balances required—let alone the manpower and small work space.

As many others and I have pointed out numerous times, there are bar lists and the bars are likely real and do exist. During the interview with Jim Puplava, I gave one of numerous possibilities that could put bars into “inventory” and yet still have several claims against them. Again, the issue with them is whether the ETF really owns them free and clear or they are encumbered or otherwise compromised

Another point is, the SLV can be “shorted” and this silver does not have to exist in inventory.

The controversy surrounding the gold and silver ETFs continues and there are proponents both for and against the GLD and SLV. In an effort to remain consistent personally, my original “take” on the silver ETF remains, which is to state that any “investment” involving silver would have an overall positive effect because it would draw more and more attention to both professional and private investors that indeed silver is not only a worthwhile investment but also has all the monetary qualities of gold and has an industrial component that will remain, under any economic conditions. [more]

Editor’s note: when it comes to gold and silver for safety and wealth protection remember one sentence. “Get real, get physical, get it in your possession.”



One more thing: astute reader Truefire points out that Barclays is now trying to sell off their iShares ETFs, including SLV. As he says, “I wonder why? Do you see the rats scurrying from the sinking ship that I do?”. Barclays In Talks To Sell iShares


4 Responses

  1. truefire,

    Based on what transpired today, I’d say the floor on the USD Index is somewhere south of 65

  2. How low will the dollar go? Will the Asians finally bail on the Us?

    Its a race to the bottom.

  3. As of 4:12pm EST, the $ price of Au is going parabolic, as in “straight up”. Based on the Fed’s announcement today, I expect stocks to do well too, but Au & Ag should outperform. Never thought we’d monetize the debt here…

    $10K/ounce, here we come…

  4. Be patient.

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