Tweet
Re: Sales of 1-Ounce American Silver Coins Soar, U.S. Mint Says.
Hi Lektrode,
A lease rate is the interest rate charged for borrowing a precious metal.
If you listen carefully to a few of the guests on the FSN Silver Roundtable, you will hear statements such as "very tight physical market" and expectations for $33+ silver in the first 4 months of 2011.
It makes no sense to me that someone would be borrowing physical silver to short over the last two weeks. It would make so much more sense to short paper instead of physical anyway (why would they shoot themselves in the foot by borrowing physical?). And the price has only rebounded back up during the past two weeks.
Also, I expect such a physical silver short would have covered by now, and lease rates would have dropped if shorting physical were the cause. But no, the Silver lease rates remain high. I think in the short term at least, lease rates do matter. Physical in certain forms, certain quantities, and in certain places is obviously difficult to obtain at this time.
Hi Lektrode,
A lease rate is the interest rate charged for borrowing a precious metal
If you listen carefully to a few of the guests on the FSN Silver Roundtable, you will hear statements such as "very tight physical market" and expectations for $33+ silver in the first 4 months of 2011.
It makes no sense to me that someone would be borrowing physical silver to short over the last two weeks. It would make so much more sense to short paper instead of physical anyway (why would they shoot themselves in the foot by borrowing physical?). And the price has only rebounded back up during the past two weeks.
Also, I expect such a physical silver short would have covered by now, and lease rates would have dropped if shorting physical were the cause. But no, the Silver lease rates remain high. I think in the short term at least, lease rates do matter. Physical in certain forms, certain quantities, and in certain places is obviously difficult to obtain at this time.
Comment