Monday, March 06, 2006


Non-Physical Silver ETF Planned In London

The Financial Times has this news. "A silver price tracker fund, also known as an exchange traded fund, is expected to be launched on the London Stock Exchange within the next month by ETF Securities, which has already launched an oil-backed ETF on the LSE. The planned new investment product is separate to the silver-backed ETF filed by Barclays Global Investors with the SEC, which is expected to make a decision shortly on the proposal."

"It is understood that ETF Securities has approval from the UK’s Financial Services Authority. ETF Securities is controlled by Graham Tuckwell, who listed the world’s first commodity-backed ETF when he launched Gold Bullion on the Australian Stock Exchange three years ago."

"Expectations of a launch of a new silver-ETF in the US have been a key driver behind the recent surge in the silver price, which has risen 60 per cent since the start of 2005. Once fully issued, the proposed BGI silver ETF would require the purchase of 130m ounces of silver, according to the fund’s prospectus. However, few have factored in the possible listing of a silver investment product in London."

"Unlike the various gold and oil backed ETFs and the BGI initiative, the proposed silver fund in London will not be physically backed by the underlying commodity. The funds raised by the proposed London listed silver ETF would not be spent on buying the metal, but the performance of the fund would remain linked to the silver price. Funds raised by existing commodity-backed ETFs are spent on buying the physical commodity, which adds to the increase in demand."

Is this similar to the most hollow, fiat-like, housing-wealth-through-debt, instruments used elsewhere? (a.k.a. neg. am. IO's ala the pyramid)

This one is funny, plain and simple.
Its one thing for a gov. with military might to say this but Mr. New Wallstreet Option?

Are there alot of stock offerings like this? Excluding Amazon stock and similar excite.coms?

Get your money for nuthin' and... - eh?
OT, but...

Found something to support my contention that the silver ETF will be like a dot-com era IPO:

**** Mogambo sez: Emphasize silver, as the looming ETF in silver will mean, as Ted Butler, writing at, says, "There's no way this much silver could be bought without sending the price to $100 an ounce." And with silver selling for less than 10 bucks an ounce, that's a nice ten-bagger gain!


OTOH, found some stuff to support your argument:

Stephen Wyatt writes (Financial Review Weekly 18-19 Feb. 2006):

“At a minimum, the recent gold price slide “suggests that the flow of buying that had driven the market to 25-year highs has been exhausted and that a perpetual (upward) trend should not be taken for granted,” a senior analyst at IFR Markets, Tim Evans, says.” A significant top has been established.”

Barclays Capital analysts argue the still strong gold market is simply a sustained bout of market exuberance with funds acting as drivers in a momentum play. They don’t believe it demonstrates solid demand and supply fundamentals.”

(Financial Review 9 Feb.2006) “Gerald Holden, managing director of mining and metals at Barclays Capital…forecast that gold prices could …move back to around $US350-$US375 in the medium term.”

This view will undoubtedly give some comfort to Elliott Wave International’s Robert Prechter who believes “Gold is in the final stages of a speculative surge…technical factors, in conjunction with a complete wave pattern and sentiment, point directly to a decline to at least $460 and probably close to $400.”

Yes... but dollar based valuation predictions are... well, based on the dollar.

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