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Multiple Anomalies Detected In Silver ETFs

Submitted by Fabio on Tue, 07/28/2009 - 17:02
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In my view from Germany, Zerohedge is pretty widely read among the brainier people on Wall Street.

This could have a massive impact:

http://www.zerohedge.com/article/project-mayhem-research-mul...

"During our research into the inventory lists of the iShares SLV and London-based ETFS physical silver funds, we discovered multiple anomalies which cannot be easily dismissed. These included the presence of internal duplicates, rough internal duplicates, weight duplicates, statistical clustering, and cross-reference duplicates. Taken together, these anomalies are cause for concern, and we suggest that more capable teams conduct further research into these issues, as they effect price discovery within the precious metals market, as these ETF shares are being used for settlement and possibly pricesuppression on the COMEX.

If these problems are caused by accounting errors, they are disturbing and perhaps profoundly incompetent, and we suggest both these funds should have their senior management replaced.

In our opinions, the only way for all of these anomalies to occur together as noted in this paper, is via systemic fraud or gross accounting error bordering on jaw-dropping incompetence."

A "Silver Swan Event" for the Godplayers?

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Submitted by legalizeliberty on Wed, 07/29/2009 - 15:37.

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Digg it

Submitted by Fabio on Wed, 07/29/2009 - 11:05.

http://digg.com/business_finance/Project_Mayhem_Multiple_Ano...
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for over 2 years I have been

Submitted by bad_karma on Wed, 07/29/2009 - 06:46.

for over 2 years I have been telling people to go to www.butlerresearch.com
all this information is old... Butler has laid out the price explosion to happen in silver.. read what he says.. buy as much 90% silver or silver mapleleafs or eagles as you can.. it will be the best investment you will ever make..

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I hope...

Submitted by Fabio on Wed, 07/29/2009 - 08:08.

...that Zerohedge has more impact than Butler. I respect him, but many people on Wall Street will dismiss him as "Silver Bug".

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I have GLD in my IRA

Submitted by scdecade on Wed, 07/29/2009 - 05:36.

This is worrisome to me. I'd really like to convert my GLD to real metal. Does anybody know where there's an authoritative explanation of how to go about converting an IRA from paper to metal? The Midas Resources link on the DP home page takes you to a form which asks for your personal information. I'd prefer to educate myself first.

I did it.

Submitted by dducks on Wed, 07/29/2009 - 12:04.

18 months ago through Goldstar Trust out of Canyon, Texas. You can roll-over a Roth or Traditional, whatever. A dealer may need to be involved to buy the gold and it is alleged to be stored at HSBC in New York. I do not know if someone else had a claim on it but only three weeks ago I got a disability note from the Doctor, sent in a form, and requested my gold.

http://www.goldstartrust.com/

I got it last week! Wahoo! 8D

I seriously had the money written off. I just knew it would be stolen. My Ma and Sister just last week lost their life savings through a scam IRA.

IRA's are another scam that Americans were drawn into for the purpose of extracting and controling our wealth. I was fooled.

I do not advocate ANYONE holding on to your money at this point in time. I am just relaying a recent fortunate experience. I would recommend getting the Doctor's note so as to take physical possesion of any belongings.

Look at CEF and...

Submitted by HawaiianDude on Wed, 07/29/2009 - 05:49.

I know about CEF and they have a gold only equivalent. CEF is gold and silver. Also there are others that are more forceful about the physical side according to thier info.

Also there are gold IRAs available but that would most likely require a rollover in your case. A rollover means you have paper federal reserve notes in your hand for a few weeks - not good in this market.

Recommend jsmineset.com and kitco and goldseek for different opinons but remember that all these sites are biased toward gold as I am myself - that is why I sleep good at night but yet may miss out on a great stock rally.

CEF

Submitted by Jive_Dadson on Wed, 07/29/2009 - 15:27.

CEF will not deliver physical gold or silver to you on demand. It is like an ETF, except without the primary participants or whatever they are called whose function is to keep the market price in line the net asset value based on the large exchange spot prices. Thus CEF can trade at a discount to or, more frequently, a premium to the underlying assets. Currently it is trading at a whopping 9.6% premium to NAV.

I don't think there's any alternative that is equivalent to holding physical gold in hand. How can you know that if you need it, you'll be able to get it?

That's what I don't understand...

Submitted by atrickpay on Wed, 07/29/2009 - 22:21.

why hold gold coins? I just want some gold as an investment hedge against heavy inflation.
Pardon my ignorance, but what's the rational for holding coins? If there was an ETF that you rusted, would you just invest in that?

I'm on it

Submitted by scdecade on Wed, 07/29/2009 - 06:20.

Thanks Dude. Investigating now.

Does that mean...

Submitted by Fabio on Wed, 07/29/2009 - 10:20.

...there is a reliable PM-ETF available in the US?

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Information about information

Submitted by scdecade on Wed, 07/29/2009 - 12:06.

You're going to have to decide what "reliable" means to you.

EFTs, the new Fractional

Submitted by Greg Butko on Tue, 07/28/2009 - 18:28.

EFTs, the new Fractional Reserves.

Just hope that everybody doesn't try to take possession at the same time!

Greg, can one take possession on these ETFs?

Submitted by atrickpay on Wed, 07/29/2009 - 11:18.

Ie. Slv, Gld, etc. I don't believe individuals can? But, maybe larger institutions could? Do you know?

Anywhoo, if nobody can take possession, I don't really care what amount of commodity they have in reserve...as long as the price accurately tracks the underlying index, then I'm happy.

My 2 Cents

Submitted by Fabio on Wed, 07/29/2009 - 11:22.

If it was only about tracking the price, they should write that in the prospectus and not pretend the ETF to be backed.
You have several commodity-trackers that are "only" backed by futures. It`s ok, but they do not pretend otherwise.
As far as I know, you can`t take possession with GLD and SLV, unlike ETFs that are sold in Europe (Xetra-Gold or ZKB Gold).

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Yes, absolutey they should

Submitted by atrickpay on Wed, 07/29/2009 - 11:48.

I agree.

Myself, I invest in GLD because I don't want to buy physical gold. As long as it tracks accurately, I'm happy. But, if it stops tracking accurately because of the fractional-reserve that they are possibly doing, then I'd be pissed.
I wish there was another alternative. AFAIK, there is just CEF but that has silver in it as well. I want solely a gold ETF..

Won't be gradual

Submitted by Jive_Dadson on Wed, 07/29/2009 - 15:34.

If it fails to track the spot price, the failure will happen instantly because of some dislocation or scandal.

Hmm,

Submitted by atrickpay on Wed, 07/29/2009 - 22:20.

thinking that over, I think you're right. It would be some kind of SEC (Securities & Exchange Cartel) investigation that would tank the eft, if anything...Tho, people would be reimbursed the FDIC or whomever...

Collective investment plan?

Submitted by Fabio on Wed, 07/29/2009 - 15:16.

I don`t know wether that exists in the US, but we (Germany, Switzerland, Austria, german speaking Europe) have small private collective saving/investment plans for bullion which actually tracks the price of gold, but is not as easily tradedable. But it`s personnaly auditable. You can go to the vault and check your barrs, if you want. At a certain amount (for instance 1 kg) you can take it home. Otherwise you can redeem it in the current governmental meaning of payment.
It`s not very common, because "gold-mania" is less widespread in the EU than in the USA, but there are some.

But the shorter your time horizont, the less you care about actually "redeemability" or "backing". You just want "it" to go "up".
That`s austrian-school time-preference-theory in living color, by the way.

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Fabio: Who monitors these ETFs? What are they doing....

Submitted by SteveMT on Tue, 07/28/2009 - 17:54.

to investigate? All they have to do is follow the money.

I don`t know

Submitted by Fabio on Wed, 07/29/2009 - 05:05.

I`m more familiar with the only ETFs I trust, the ones from Zurich Kantonalbank in Switzerland. I do not know wether they are available in the US. They are real ETF and no ETCs.
They even give you the right to get the metalls delivered and to visit the vaults. They are regularly audited and the vaults are in Switzerland.
I just called them today, because they have some barrs with 0-weight on their list. They told me that those are the barrs they have already physically delivered.

I personally do not understand how anyone, especially professionals, could ever have bought GLD or SLV. If you read the prospectus, you`ll find that the metals is not even insured against simple theft.
If you feel fine with ETCs backed by futures, like UNG (natural gas), fine, but UNG does not pretend to be backed by real natural gas.

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systematic fraud

Submitted by troy on Tue, 07/28/2009 - 17:15.

i vote "systematic fraud"

So do I

Submitted by Fabio on Tue, 07/28/2009 - 17:17.

It is so insane...We are not talking about a grocery store inventory list with a couple of tuna tins counted twice by accident...I wonder who the accounting company is.

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Authur Anderson of Enron fame probably, they were creative.

Submitted by HYDROMAN on Tue, 07/28/2009 - 17:50.

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