Buying Silver as Kyle Bass Makes the Case for Hedge Funds

							Buying	
  Silver	
  as	
  Kyle	
  Bass	
  Makes	
  the	
  Case	
  for	
  Hedge	
  Funds	
  
	
  
Up	
  to	
  this	
  point,	
  no	
  major	
  or	
  big	
  money	
  has	
  entered	
  the	
  silver	
  market	
  or	
  stood	
  for	
  
delivery	
  in	
  a	
  significant	
  way	
  outside	
  of	
  outspoken	
  Toronto-­‐based	
  silver	
  ETF	
  
manager	
  Eric	
  Sprott.	
  
	
  
Yet	
  it	
  is	
  rather	
  hard	
  to	
  imagine	
  why	
  they	
  would	
  not	
  be	
  joining	
  Sprott,	
  with	
  QE's	
  
stretching	
  to	
  infinity,	
  Fiscal	
  Cliffs,	
  Debt	
  Ceilings,	
  European	
  Financial	
  Crises,	
  and	
  now	
  
Germany	
  no	
  longer	
  trusting	
  its	
  precious	
  metal	
  "custodians"	
  as	
  it	
  repatriates	
  its	
  gold.	
  
	
  
Add	
  these	
  factors	
  to	
  the	
  still-­‐extreme	
  risk	
  of	
  bank	
  asset	
  deterioration	
  from	
  public	
  
debt	
  servicing	
  constraints,	
  the	
  excessive	
  concentration	
  of	
  deposits	
  held	
  in	
  the	
  too-­‐
big-­‐to-­‐fail	
  financial	
  institutions,	
  and	
  the	
  risk	
  of	
  systemic	
  contagion	
  resulting	
  from	
  
just	
  one	
  derivative-­‐generated	
  event	
  —	
  and	
  the	
  market	
  has	
  plenty	
  of	
  reasons	
  to	
  be	
  
bullish	
  on	
  silver.	
  
	
  
Why	
  are	
  Big	
  Funds	
  Not	
  Buying	
  Silver?	
  
	
  
Presumably,	
  many	
  of	
  the	
  big	
  investors	
  have	
  avoided	
  entering	
  the	
  silver	
  market	
  
because	
  they	
  either	
  do	
  not	
  know	
  about	
  or	
  understand	
  these	
  factors,	
  or	
  if	
  they	
  do,	
  
they	
  do	
  not	
  want	
  to	
  be	
  the	
  ones	
  blamed	
  for	
  pushing	
  the	
  tottery	
  financial	
  markets	
  
over	
  the	
  edge.	
  
	
  
Furthermore,	
  given	
  the	
  relatively	
  small	
  amount	
  of	
  above-­‐ground	
  investment	
  grade	
  
supply	
  of	
  silver,	
  it	
  would	
  be	
  difficult	
  to	
  accumulate	
  a	
  large	
  position	
  without	
  setting	
  
the	
  market	
  on	
  fire.	
  
	
  
Read	
  the	
  rest	
  of	
  the	
  article.