Why the Really Big Play is in Silver

Posted by The Mad Hedge Fund Trader

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Those transfixed by gold topping the $1,200 level again have been missing the real action in silver. The white metal has soared 24% to $18.46 since the February low, compared to a more modest 15% move for the barbaric relic, an outperformance of 1.6 to one.

I have been a raging bull on silver all year, grabbing you by the lapels and shaking you senseless if you didn’t buy. It is nothing less than owning gold with a turbocharger. Silver gives you a nice double play. Its qualities as a precious metal are giving it a major boost from a weak dollar, always a risk that is out there. It is also an industrial commodity, which unlike gold, is consumed, and therefore gives you a call on the recovering economy.

If you don’t think this move is real, check out the shares of the silver producers. Coeur D Alene Mines (CDE) has rocketed by 444% the 2009 low, while Silver Wheaton (SLW) is up a staggering 893% and Hecla Mining (HL) has soared by 512%.  To accumulate .999 fine Silver Eagles or silver bullion, click here.

How long will it take to get to the old high of $50? William Herbert Hunt, who engineered the 1980 squeeze with his brother Nelson with a 100 million ounce long position that last took it that high, could tell you, but only from the grave.





The Mad Hedge Fund Trader graduated from the University of California at Los Angeles (UCLA) with a degree in Biochemistry and a minor in Mathematics in 1974. He moved to Tokyo, Japan to join Dai Nana Securities as a research analyst of Japanese companies, becoming fluent in Japanese. In 1976 he was appointed the Tokyo correspondent for The Economist magazine and the Financial Times. For the next seven years he published thousands of articles about the economies, companies, and leaders of every country in Asia. He was one of the first American correspondents to cover China during the cultural revolution. He reported on the American attempt to climb Mount Everest and guerilla wars throughout Southeast Asia. The major figures he interviewed included China’s Premier Deng Xiaoping, Ferdinand Marcos of the Philippines, the UK’s Margaret Thatcher, the PLO’s Yassir Arafat, and of course President Ronald Reagan.

In 1982 the Mad Hedge Fund Trader moved to New York as the US editor of Euromoney magazine. As a member of the White House Press Corps he covered the early years of the Reagan administration. In 1983 he was hired by a top investment bank to build a new division in international equities. In 1985 he was promoted to vice president and transferred to London to head up the sales and trading of Japanese equity derivatives in Europe and the Middle East.

In 1989 the Mad Hedge Fund Trader was appointed a director of the Swiss Bank Corp responsible for its then vast portfolio of Japanese equity derivatives. A year later he left to set up the first ever dedicated international hedge fund, which became a top performer in the industry.

In 1999 the Mad Hedge Fund Trader sold his hedge fund to concentrate on managing his personal investments. He focused on natural gas exploration and development in Texas and Colorado, as well as other commodities. Seeing the incredible inefficiencies and severe mispricing offered by the popping of multiple bubbles during the Great Crash of 2008, and missing the adrenaline of the marketplace, he returned to active hedge fund management.
The Mad Hedge Fund Trader has always devoted his life to understanding global capital markets not because of money he could make there, but because of the limitless intellectual challenge it offered. He created this website to air his iconoclastic, out of consensus, and often radical ideas in public, as well as to vent on the matters of the world at large.

In his free time, the Mad Hedge Fund Trader climbs mountains, does long distance backpacks, practices karate, performs aerobatics in vintage aircraft, collects vintages wines, reads the Japanese classics, and engages in a wide variety of public service and philanthropic activities. Why they call him “mad” he will never understand.