this is what keith neumeyer, the president of first majestic silver, had to say about the comex. i had mentioned this interview in passing, but for those who missed it, here are some of the points he made in greater detail:

he expects to see new highs in gold and silver, but the comex system is corrupt and inefficient. there is a major disconnect between the paper and physical markets. his company won't sell physical silver for less than $15 - there is no reason to. they have to sell their production at an average of 30 days' prices on their commercial contracts, so at least they avoid the ridiculous spike low prices, but the system of comex trading has to change.

he expects to see a new system within the next two years in which institutions can't trade unlimited amounts of paper. the largest banks and brokers are manipulating trading in ways they shouldn't. it's a farce because the paper price has no relationship to the physical price, and the producers have to sell to users at the paper price.

for a company like first majestic, this means that if they produce 5 million ounces of silver a year, and the paper price is $5 lower than where it would be in a free market, his company loses $25 million of cash flow.

the transactions taking place in the paper markets are not commercial transactions. in one month, the banks went short 130 million ounces of silver. the banks and brokers take these positions, and the regulators let them do it. the united states officials have allowed this to happen, and the cftc has to move in and change the rules.

that is what the president of a junior silver producer had to say. the interview can be found at financialsense.com. it was two weeks ago, and when you listen to it you can hear the outrage in his voice. his company is being impaired because of the manipulation in the commodities markets. his company is nowhere near as profitable as it should be, and his stock price has been beaten down so that he can't rely on the equity markets for financing.

in my opinion, first majestic is one of the best of the junior silver producers, the kind of company that should be thriving in this marketplace, if it were not for the crooks who are rigging the silver markets.