Reply #62: Eric Sprott bought a lot of it: [View All]

[ret5hd]

http://www.321gold.com/editorials/moriarty/moriarty042511.html

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Eric Sprott started his own paper silver fund called the Sprott Physical Silver Trust. It's still paper silver like SLV or the CEF fund. It has some unique features, not benefits but features. He has done a brilliant job of promoting it.

Recently he purchased $300 million dollars more physical silver to put in the closed fund. As a result of his excellent promotion, as of last Wednesday, silver was selling for $46. If you bought the CEF silver fund, you paid $47.88 for silver. If you bought SLV, you paid $46 with no premium but if you bought PSLV, the Sprott Silver Trust, you paid an incredible $57.73 an ounce for silver.

I'd say that Eric Sprott buying $300 million dollars more silver lately was incredible timing. He pocketed probably $60 million in profit. Is Eric Sprott bullish on silver? I'd say so. He has 60 million reasons to be bullish. He can buy at the exact top of silver and watch a 25% decline and still make money.

How wise was it for investors to pay a 25% premium for silver? I'd like to believe my readers are smart enough to figure that out for themselves. Eric Sprott is both brilliant and rich but paying 25% over spot is not wise investing.
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my comment: The writer of this piece is Bob Moriarty, who seems to have a feud/grudge against some of the silver guys (one in particular whose name i can not at this time remember). I think this sometimes colors his opinions on silver. But his advise on metals has been mostly spot on, (especially gold) and his knowledge of the technical and managerial aspects of mining is unparalleled. Practically every mine he writes about he personally visits, whether Asia, South America, Africa, etc. and he is not afraid to return from a long trip and say "this mine is a loser" or "the mine is good but the management is terrible". (not actual quotes, but that is the gist of some articles he has written)