Great post, ESL.

I wondered a few years ago, back around 2004, if I remember correctly, when these PM ETFs began to surface, why they were being created when there was talk, even then, of coming shortages, cartel shenanigans and the like. I always felt that they were not really created for the masses as an investment vehicle but more likely as a place to stash great quantities of the metals for future cartel use, which would be especially useful for the cartel in the face of a possible future shortage of gold and silver.

I still wonder why there hasn't been a more concentrated analysies of these ETFs, since the way they're set up, their vague prospectuses, where the metal is supposedy stored, no auditing, Barcley'sand JPM's roles, etc. raises a lot of grave concerns, at least to me.

Every once in awhile, though it seems to be increasing somewhat, someone of note comes out and says point blank that we've all been had with these ETFs, that they are really a way to not only syphon money away from the PM stocks but to ensure that the cartel will have an almost unlimited source of metals to borrow or lease or confiscate or whatever. An obviouse win win for them, IMO.

These comments usually circulate for a little time but they don't seem to gather a life of their own. A lot of people seem to either ignore them or see little merit in them and go back to their analyses of supply and demand, chart patterns, and the like as the relevant reasons for the current situation and the outlook for the future.

I think your comments of possible eventual confiscation of the metals in the ETFs by the fed to bail out cartel shorts is well taken. If the fed's objective is to maintain at any cost all or at least some control over the prices of the precious metal prices, they are capable of anything.

Looks as if we're going to dodge the main force of hurricane IKE here in southeast Florida, so it's off to the zoo.