Skip to main content

The silver question: an update.

The purpose of this entry is to provide an update for the recent post regarding Warren Buffet's silver position and the silver ETF. I thought I'd do that by including links to the latest commentaries from Ted Butler and David Morgan, since I cited their some of their earlier ruminations in the last Buffett silver post. Readers interested in the Barclays silver ETF or the matter of Berkshire Hathaway's recently closed-out silver position should read on.

First, we'll start with an excerpt from Ted Butler's May 8 commentary, the first part of which is titled, "Buffett Loses His Silver".

The recent revelation that the renowned investor Warren Buffett sold his silver was a mega-event. It was big news when Mr. Buffett bought silver some 8 or 9 years ago, and its sale is also big news. Let me state the facts as I know them, and then I’ll speculate.

Mr. Buffett always said he would make it known when he sold his silver and he kept his word, using the occasion of his company’s annual meeting to tell of the sale. While he did not reveal the exact amount, time and price of the sale, he indicated that he "sold too early" and did not profit from the sale. I found that very surprising and particularly unusual for Buffett.

Read more of Butler's commentary at the link included above.

Next I'd like to include a section from David Morgan's most recent submission to Financial Sense. In this article, David looks back at some of his earlier thoughts on the silver ETF and the role that Berkshire Hathaway's silver position might have occupied in backing the (at that time) proposed ETF. Here is an excerpt:

What the proposed Silver ETF requires is real silver, but not necessarily new purchased silver. In fact the proposed amount for this issue is about 130 million ounces of silver to begin. This is almost exactly the amount reportedly purchased by Berkshire Hathaway in 1997. We have absolutely no inside knowledge but wish to illustrate a point. Suppose a large holder of real silver were to “pledge” the metal under some type of derivative scenario. The ETF would be up and running, and real metal would be “behind” the transaction.

Well, if you've read the commentaries of Butler and Morgan, you will have an idea as to what might have happened to Berkshire Hathaway's silver position. From what I gather, Butler's opinion seems to be that Berkshire's silver was called away as a result of their leasing, while Morgan seems to support the notion that Berkshire's silver provided the backing for the Barclays Silver ETF.

Interesting, and if we haven't exactly solved this bit of intrigue, we do have some interesting information regarding less-discussed aspects of the precious metals ETFs, thanks to both Morgan and Butler.

Popular posts from this blog

The Dot-Com Bubble in 1 Chart: InfoSpace

With all the recent talk of a new bubble in the making, thanks in part to the Yellen Fed's continued easy money stance, I thought it'd be instructive to revisit our previous stock market bubble - in one quick chart.

So here's what a real stock market bubble looks like. 

Here's what a bubble *really* looks like. InfoSpace in 1999-2001. $QQQ$BCORpic.twitter.com/xjsMk433H7
— David Shvartsman (@FinanceTrends) February 24, 2015
For those of you who are a little too young to recall it, this is a chart of InfoSpace at the height of the Nasdaq dot-com bubble in 1999-2001. This fallen angel soared to fantastic heights only to plummet back down to earth as the bubble, and InfoSpace's shady business plan, turned to rubble.

As detailed in our post, "Round trip stocks: Momentum booms and busts", InfoSpace rocketed from under $100 a share to over $1,300 a share in less than six months. 

In a pattern common to many parabolic shooting stars, the stock soon peaked and began a…

New! Finance Trends now at FinanceTrendsLetter.com

Update for our readers: Finance Trends has a new URL! 

Please bookmark our new web address at Financetrendsletter.com

Readers sticking with RSS updates should point your feed readers to our new Finance Trends feedburner.  



Thank you to all of our loyal readers who have been with us since the early days. Exciting stuff to come in the weeks ahead!

As a quick reminder, you can subscribe to our free email list to receive the Finance Trends Newsletter. You'll receive email updates about once every 4-8 weeks (about 2-3 times per quarter). 

Stay up to date with our real-time insights and updates on Twitter.

Moneyball: How the Red Sox Win Championships

Welcome, readers. To get the first look at brand new posts (like the following piece) and to receive our exclusive email list updates, please subscribe to the Finance Trends Newsletter.

The Boston Red Sox won their fourth World Series titleof the 21st century this week.

Having won their first Series in 86 years back in 2004, the last decade-plus has marked a very strong return to form for one of baseball's oldest big league clubs. So how did they do it?

Quick background: in late 2002, team owner and hedge fund manager,John W. Henry(with his partners)bought the Boston Red Sox and its historic Fenway Park for a reported sum of $695 million.

Henry and Co. quickly set out to find their ideal General Manager (GM) to help turn around their newly acquired, ailing ship.

This brings us to one of my favorite scenes from the 2011 film, Moneyball, in which John W. Henry (played by Arliss Howard) attempts to woo Oakland A's GM Billy Beane (Brad Pitt) over to Boston with an excellent job off…