Madoff and Manipulation of the Silver Market

I'm sure that everyone has heard about the Madoff case where he potentially lost $50 billion for his clients. Cases like these only add insult to injury to our economic system.

I mean... how could this person lose $50 billion and get away with it? I guess if you compared it to the United States's $10 trillion national debt it would look meaningless.

I read a convincing article on the manipulation of the silver market today. In it, David Morgan tells about the widening disparity between paper silver on the futures markets and physical silver. It's worth a read.

http://www.marketoracle.co.uk/Article4796.html

I believe silver is extremely undervalued right now. At a ratio of nearly 80 ounces of silver to 1 ounce of gold at today's prices (about $10.70 an ounce), it is extremely underpriced compared to the historical ratio of 16 to 1. If the ratio were 16 to 1, the price of silver should be roughly around $52.25.

Physical silver is becoming increasingly difficult to buy. I've visited many bullion dealers online, and they have all charged ridiculous premiums to the spot price of silver. For those interested in investing in silver, I would look at the silver ETF that is traded on the NYSE with the symbol SLV. I've listed the fund summary below.

The objective of the investment is to reflect the price of silver owned by the trust less the trust's expenses and liabilities. The fund is intended to constitute a simple and cost-effective means of making an investment similar to an investment in silver. Although the fund is not the exact equivalent of an investment in silver, they provide investors with an alternative that allows a level of participation in the silver market through the securities market.

All the money that were or will be used for the Wall Street bailouts will eventually make its way into the system. Inflation will cause everything priced in dollars to increase, and silver is included. The government can only do two things to pay for the bill: 1) Raise Taxes or 2) Print Money. Since the Obama presidency will probably not lead to an increase in taxes, the government will need to run the printing presses on for longer periods of time.