Just speaking for my own point of view, I have never believed there is 'no silver out there'. Hell, just the additional supply from new mines or recently expanded operations amounts to tens of millions of ounces of silver per year. Recurring mine supply plus recycled bullion is continually available and delivered to warehouses for sale or to settle contractual obligations.

Then add the hundreds of millions of ounces of silver bullion held by investors, from small players like myself up to hedge funds with millions of dollars of bullion owned. That silver may not be available to the market today, but at some price in some time in the future, it will be.

Two things have definitely changed:

1) The market is begining to understand that silver supply is not infinite, and that there is no surplus as has been commonly acknowledged for many years. In fact there is a stuctural deficit, and demand has outstripped available supply for many years leading to the drawdown of inventory.

2) The outstanding short position in silver futures is being recognized as illegal market manipulation, and there are about 25 separate lawsuits in process to demand compensation, but more importantly, that outstanding short as a proportion of the total remaining inventory is becoming dangerously exposed.

This is a process folks. There is not a time when we can declare victory until the actual default of that paper bullion is upon us. Prices for silver are rising in anticipation of this, but the Cartel is still powerful and able to influence the spot market for the short term. That is why the situation can be more acute in terms of developing shortages, and yet we can still be bombed in short raids and the metals held back. I sit on the beach and watch the waves crash and then recede, without knowing the tide is coming in, unless I watch patiently for a long time and note the high water mark is a bit further up the sand with every cycle.

There is still lots of silver around. I have heard estimates of more than a billion ounces worldwide. It is just that the silver is not available at the current price. People who want large blocks of silver now are paying a premium to get it, or else waiting in line with contracts in hand and hoping the settlement process does not fail before they are delivered.

The spot silver price is the greatest deception of all. The stocks all trade as if that price is the real price. I can book a ticket to vegas very cheaply today for July, but if I wait until the day before the 4th of July to travel I will pay a hell of a lot more. Urgency costs more money. As the pool of available metal shrinks, the urgency on behalf those who must own it will rise and so too will the price.

The market is gradually differentiating between paper silver with no urgency, and real bullion that is irreplaceable for end users. Eventually this will trigger a default in paper silver, but until that day we have to be patient and put up with all of this crap.

cheers!

mike