Central Fund of Canada (CEF)

[Tommy]

$CEF - Worldwide Silver Shortage Pushes Premiums to 40% on Silver Eagles

https://www.goldstockbull.com/articles/worldwide-silver-shortage-pushes-premiums-to-40-on-silver-eagles/

... "Whatever the truth may be, the disconnect between paper prices and free-market real-world prices has never been greater. There is definitely something strange happening in order to create an environment where increasing demand and supply shortages somehow results in lower prices. This breaks the most fundamental economic law of supply and demand, supporting claims by GATA and others that gold and silver prices are being manipulated.

One way to purchase gold and silver at the artificially low prices is to purchase shares of the Central Fund of Canada (CEF). The fund has been around since 1961 and holds 95% or more of their assets in unencumbered, segregated and insured, passive long-term holdings of gold and silver bullion. Bullion holdings and bank vault security are inspected twice annually by directors and/or officers of Central Fund. On every occasion, inspections are required to be performed in the presence of both Central Fund’s external auditors and bank personnel. Central Fund’s chief executive comments:

“Our bullion is stored in separate cages, with the name of the owner printed on the cage, and on top of each pallet of bullion it states Central Fund or Central Gold-Trust. This disables the bank from using the asset for any of their purposes. We also pay Lloyds of London for coverage of any possible loss.”

The Central Fund of Canada almost always trades at a premium to their net asset value, sometimes as high as 20% over. But shares are currently trading at a discount. This is a rare occurrence for CEF and allows individuals to invest in physical precious metals at or near COMEX pricing. If history repeats, CEF will be bouncing back to a hefty premium in the near future as precious metals rebound. While it is not the same as having the metals in your possession, I view it as the next best thing and think the recent sell off is providing an excellent opportunity to establish or add to positions.

This growing divide between the paper silver price and real-world price will have to narrow at some point soon. The more big-money investors realize the huge price gap and act on it, the faster the gap will close or soon COMEX will default or go broke from offering hefty cash incentives to investors to dissuade them from taking delivery. In the meantime, if anyone can find me some silver eagles anywhere near the COMEX price, I have a boatload of fiat notes to trade. Keep stacking (if you can find any)." ...