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Keith Weiner

Keith Weiner

Keith Weiner is CEO of Monetary Metals, a precious metals fund company in Scottsdale, Arizona. He is a leading authority in the areas of gold, money, and credit and has made important contributions to the development of trading techniques founded upon the analysis of bid-ask spreads. He is founder of DiamondWare, a software company sold to Nortel in 2008, and he currently serves as president of the Gold Standard Institute USA. Weiner attended university at Rensselaer Polytechnic Institute, and earned his PhD at the New Austrian School of Economics.

Articles by Keith Weiner

The Truth about the Silver Squeeze

9 days ago

Keith wrote about the silver squeeze narrative originally here, then here, and again here. This article is his latest commentary. 
Some recent videos about the silver market are generating more buzz than we have seen in a while. They make several points, but the main one is that there is a global shortage of silver. This assertion stands in contradiction to the fact that the silver price has dropped. As of the date of the first of these videos, it had dropped around 10% from its level just a month earlier.
An 8th grader is a good litmus test for ideas in economics and markets. What would a teenager say happens to the price of a commodity, when it becomes scarcer? ”It rises!”
So how do adults assert that a big scarcity is developing, while the price is dropping? They claim that the price is

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Monetary Metals Issues Gold Token

April 1, 2021

Scottsdale, Ariz, April 1, 2021— Monetary Metals® announces that it has issued a gold token. Unlike the company’s other products, this one is not designed to pay a yield.
In a sign of the times, the company intends this product to generate big speculative gains. It is designed to GO UP!
It is (at issue date) 2,000 fine bucks of gold. However, some guy predicted it would go up to 4,000 or maybe even 5,122 fine bucks of gold.
“It’s magical,” gushed Monetary Metals CEO Keith Weiner. “The same gold token can go up, and when that happens, it has more fine bucks of gold in it!” The company plans to revolutionize retirement, paying for college, and buying a house.
“Unlike bitcoin, this token will work even when the Internet goes out, like in a nuclear winter, zombie apocalypse, or an anvil falls

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Is Inflation or Deflation Coming? Part 2

March 15, 2021

In Part One of this two-part series, we differentiated between nonmonetary forces pushing up prices as opposed to the monetary forces pushing them down. We closed with acknowledging that some will say, “Yes, but interest rates have been rising.” Indeed. Here’s a graph of the 10-year Treasury yield. Look at that big move up since […]
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Is Inflation or Deflation Coming? 15 March

March 15, 2021

By the M0 measure of the money supply, there was a 52% increase between February 2020 and January of this year. This is a graph of M0 going back to 2000.

There. Proof of the coming hyperinflation. It took centuries to get to $3.4 trillion monetary base, and less than a year to increase it by over half. QED. This is all you need to know!
At least, so say those who are certain that prices are set to skyrocket. And who, of course, also say you should buy gold as it will skyrocket too.
On the other side, the hacks and apologists for the central bank and deficit spending argue there’s nothing wrong with the current monetary and fiscal policies. Paul Krugman, in this debate, asserts (in between many weasel words) that the Biden $1.9 trillion spending package won’t cause much inflation.
A Bank

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The Fedcoin is Coming, Part 2

March 8, 2021

In Part One, we said that a Fedcoin is coming. The Fed will have no choice but to issue its own digital currency. But not because of the propaganda that we’re competing against China, or including the unbankables. If they issue a Fedcoin (which is not certain right now), it will be because they are […]
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The Fedcoin is Coming, 8 March

March 8, 2021

Before we talk about Fedcoins, let’s look at the old school non-digital, non-blockchain, coin. Gold. And silver.
Since January 4, the price has dropped about $244. And the price of silver has fallen about $4. Are these buying opportunities? Or the end of the brief gold bull market of 2020 (i.e. Covid)?
It helps to return to the idea that gold is the unit of measure of value. Not as a rhetorical device to sell gold, but because it gives a clearer picture.
If one thinks in dollars, one thinks that bitcoin is rising, stocks are rising (though not this week), oil is rising, other currencies are rising, etc. And gold went up, but is now coming down.
It’s hard to make heads or tails of this. Why would one asset go down when everything else is going up (it’s tempting to want to believe that this

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Central Planning Covid Vaccinations

February 27, 2021

I just had a long argument about central planning of the Covid vaccine.

The occasion for this argument is that I drove someone to the other side of Phoenix for a 5:30am appointment. Why 5:30? Because the government is doling out doses ‘round the clock.

I marshalled all the facts. We’re nearly three months in to this exercise in central planning. And even people classified in the first priority group, due to age or medical condition, must wait a month or longer and take whatever time slot may be open such as 5:30. Oh yeah be there 15 minutes ahead of time. Did I mention it’s nearly an hour drive even without traffic at Oh Dark Thirty?

I showed him that we don’t have this problem with flu vaccines. I described how companies like Nintendo can manufacture and distribute tens of

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What’s The Real Purpose of Money?

February 17, 2021

There is an old rhyme once used in economics books.
“Money is a matter of functions four: a medium, a measure, a standard and a store.”
Three of these functions are clear.
A medium of exchange is what people use to pay for goods.
A measure means that money is a way of measuring economic value: the unit of account. Suppose a business has 100 units of money worth of assets at the start of the year. At the end of the year, it has 110 units. It has earned a profit of 10 units. Of course, this calculation is only meaningful if money measures value accurately.
Storing value is the flip side of this same coin. If someone holds 100 units of money for a year—or ten years—he should have the same amount of value at the end.
Let’s just say that it’s now clear why this old verse is no longer so popular

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Monetary Metals Gold Brief 2021

February 16, 2021

This is our annual analysis of the gold and silver markets. We look at the market players, dynamics, fallacies, drivers, and finally give our predictions for the prices of the metals over the coming year.
Introduction
Predicting the likely path of the prices of the metals in the near term is easy. Just look at the fundamentals. We calculate the gold fundamental price and the silver fundamental price (methodology described below) every day, and our data series goes back to 1996. Here is a graph showing the gold fundamental for three years.

Last year, with the price of gold around $1,575 our call was:
“We believe it is likely that gold will trade over $1,650 during 2020. We would not bet against it trading higher, perhaps much higher.”
As it turned out, the price briefly spiked over $2,000.

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Monetary Metals Gold Outlook 2021

February 15, 2021

This is our annual analysis of the gold and silver markets. We look at the market players, dynamics, fallacies, drivers, and finally give our predictions for the prices of the metals over the coming year. Introduction Predicting the likely path of the prices of the metals in the near term is easy. Just look at […]
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Reddit Residue on Silver, 3 February

February 3, 2021

The price of silver is going up and down like a yo-yo. On Sunday and into the first part of Monday, the price skyrocketed on news that Reddit was touting the metal. But as the data clearly showed, the price was not driven up by retail buying of physical metal.
To be sure, there was retail buying. But even if they depleted the finite inventories of Eagles and Maples, they were not the buyers that pushed the price up to $30. That would be the futures speculators.
Speculators use the futures market because it offers great leverage. But leverage gives them itchy trigger fingers, and they will sell to take profits or stop losses at any time.
That time began around 15:00 GMT Monday, and lasted through 6pm Tuesday. On Tuesday alone, the price dropped two bucks.
The Retail Buyers
The premia on

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Ruh Roh Silver, 2 February

February 2, 2021

Sometimes you can count on the manipulation conspiracy theorists to get it exactly wrong. Not just a little bit wrong, nor halfway wrong. Not even mostly wrong. Totally wrong, backwards.
Michael Crichton, in talking about the Gell-Mann Amnesia Effect said this:

“You open the newspaper to an article on some subject you know well. In Murray’s [Gell-Mann] case, physics. In mine, show business. You read the article and see the journalist has absolutely no understanding of either the facts or the issues. Often, the article is so wrong it actually presents the story backward—reversing cause and effect. I call these the ‘wet streets cause rain’ stories. Paper’s full of them.
In any case, you read with exasperation or amusement the multiple errors in a story, and then turn the page to national or

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What Will Reddit Do With Silver? 29 Jan

January 29, 2021

The hot story this week is the incredible run up in the stock price of GameStop. A week ago, this was a $40 stock, with the company losing well over $4 a share. That’s not surprising for a retail store operator in the world of lockdowns. What is surprising is what happened this week.
The share price ran up to almost $500.
To understand why, let’s take a step back and look at the context.
What Caused GameStop to Run Up?
The stock is heavily shorted, including by hedge funds—probably because the prospects for money-losing retailers are bleak. Then a group on Reddit, Wall Street Bets, promoted the idea of buying the stock because the short interest was greater than the total number of shares (they assumed that this means illegal naked shorting—not necessarily.)
But buy they did. And squeezed

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Reflections Over 2020

January 5, 2021

Wow, it has been a heckuva year! One thought leads to another on this sunny-but-cool January 1.

Having watched a few seasons of Forged in Fire, I’ve gained an appreciation of how difficult it is to pound and grind a lump of steel into a blade, even with power tools. There are many ways for it to go wrong. And “wrong” generally means catastrophic failure—a crack in the metal that will cause it to break into pieces when hit.

That led to thoughts regarding an advantage, in Medieval warfare, to using an axe compared to a sword.

 If you could swing your axe against a sword blade, you’d have a good chance to break it and thus disarm your foe. Then I thought about rapiers and foils, which were much lighter and springier. Then I had the first “a-ha” moment.

When guns first came to

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Reflections Over 2020

January 4, 2021

Wow, it has been a heckuva year! One thought leads to another on this sunny-but-cool January 1.
Having watched a few seasons of Forged in Fire, I’ve gained an appreciation of how difficult it is to pound and grind a lump of steel into a blade, even with power tools. There are many ways for it to go wrong. And “wrong” generally means catastrophic failure—a crack in the metal that will cause it to break into pieces when hit.
That led to thoughts regarding an advantage, in Medieval warfare, to using an axe compared to a sword.
If you could swing your axe against a sword blade, you’d have a good chance to break it and thus disarm your foe. Then I thought about rapiers and foils, which were much lighter and springier. Then I had the first “a-ha” moment.
When guns first came to the battlefield,

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An Economist Rebukes The Economist

December 18, 2020

There are but two ways that man can deal with man: reason and force. Reason includes invention, design, entrepreneurship, finance, borrowing and lending, construction, production, manufacturing, mining, farming, trade, marketing, distribution, sales, and contract.
Force is when someone picks up a gun. The gun is used to override the reason of the victim with the whims of the gun wielder. Criminals use force to steal and otherwise harm people. But criminals are only bit players. The main force-wielding actor is the government.
Economics is the study of people using reason to drive their activities, as listed above. Force is the negation of economics. There are several ways to see this.
How Force Negates Economics
One is that force attacks the mind. Those who act under compulsion, at

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Wrong Measurement, Wrong Macro Call

December 14, 2020

We have written much on the topic of economic measurement. Does the dollar measure gold, is it appropriate to say that “gold went up”? Or does gold measure the dollar?
Does a line of gummy bears laid out on the kitchen table measure the ruler? Does one stretch some rubber bands one day, and say that “the steel meter stick is 6.8 rubber bands long”, but the next day observe that it has gotten longer and is now 7.1 rubber bands long? Does the sinking ship in the stormy seas say that the lighthouse is going down and up, but mostly up?
Consumer Prices & Wages
If you drop both a brick and a board over the edge of a cliff, they both fall. But the brick falls a bit faster, thanks to its higher mass to surface area ratio. Now, picture a camera mounted on the brick. It would see the board going up.

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Open Letter to Gregory Mankiw, 7 December

December 7, 2020

Dear Professor Mankiw:
I am writing in response to your article in the New York Times, “The Puzzle of Low Interest Rates”. I commend you for recognizing two important truths, which are missed by many other observers. One, that there has been a breathtaking drop in the interest rate over 40 years. Too many dismiss this with an airy hand wave, or deny it.
Two, you see that the cause is not the Federal Reserve, at least not directly. As you note, the Fed aims to set the interest rate at levels determined by “deeper market forces.” In my theory of interest and prices, I show how the Fed sets up a dynamic which is bigger than the central bank itself. Once set in motion, this dynamic moves in one direction for a long time, with positive feedback loops that act like a ratchet. Since 1980, we are

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Bitcoin: What Is It Good For?

December 2, 2020

It was just two days ago, that we wrote about last week’s slide in the silver price from around $24, to around $22.50. Well, yesterday and today the price ascended back to around $24.
The question is whether silver is now just as scarce as it was, scarcer, or more abundant? Read on…
But First, Bitcoin
First, we want to touch on what has been happening in the world of bitcoin. We will even break our preference to criticize it only when it’s skyrocketing (the basis of most criticism of bitcoin—or gold and silver—is when the price drops).
Within a period of about 17 hours, bitcoin dropped about $1,500. Prior to that it was skyrocketing. It had been on quite a tear, just about doubling from its low on September 7.
Just imagine if your mortgage doubled! You’re going along, paying about $1,500 a

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That Precious Metals Rumor Mill, 30 November

November 30, 2020

We are hearing rumors this week of a shortage of the big silver bars, the thousand-ouncers.
No, we don’t refer to bullion banks saying this. Nor big dealers, who are happy to sell us as many of these as we can buy. Nor our peeps in high places (we don’t claim to have any such peeps).
We refer to the usual suspects. We talk about abundance and scarcity of the metals in nearly every one of these reports, in terms of the spread between spot and futures prices. Some people assume that their local dealer’s markup on Eagles represents spot. Sometimes the price of Eagles may seem a decent proxy for spot, but it is not. Eagles are produced in a supply chain that is inflexible. If demand rises above a threshold, it will first pull the Eagles out of the distribution channel. And then it will drive

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The Great Reset, 23 November

November 23, 2020

There are now two entirely different notions of a coming “reset”. One has been popular among those who speculate on the gold price. They expect a revaluation of the dollar. However, the government does not set the value of the dollar. So there is no way to reset the value. Indeed, the government has been trying to push down the value of the dollar for over a decade, and mostly failing (because increasing quantity is not the same thing as decreasing value).
But that is not the reset discussed today. We want to look at the reset proposed by the World Economic Forum, and the book by Klaus Schwab and Thierry Malleret. They start with the fact that lockdowns have inflicted economic harm. They’ve impoverished people. And resulted in a random set of policies.
In a sense, their so-called reset is

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Yes, Virginia, There Is An Alternative, 11 November

November 11, 2020

On Monday the dollar had a ferocious rally, moving up from 15.87mg gold to 16.77mg and from 1.21g silver to 1.32g. In mainstream terms, the price of gold dropped about a hundred bucks, and the price of silver crashed $2.20.
One notion we’re hearing a lot now is, “there is no alternative to stocks.” Certainly, stocks have been rallying. They were up in Sunday evening (as we reckon it here in Arizona) trading. Then Pfizer announced good news for its COVID vaccine, and that seemed to be the signal to bid up stocks even more.
Many in the mainstream believe that stock prices are linked to the economy. Many of the rest would quibble slightly, and say that stock prices predict the economy. However, we argue that stocks and other assets trade inverse to interest rates. A stock has a yield (well,

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Recovery: GDP vs MPoD, 2 November

November 2, 2020

On Wednesday last week, the price of silver dropped from over $24.25 to just a bit over $23 before bouncing back to around $23.50. The next day, the price dropped again, briefly to around $22.60 before mostly recovering (but a dime to a quarter down).
Let’s look at the graph of the price and basis (i.e. abundance) action for 28 and 29 October.

At the end of the day (second day), the price is about a buck lower. And the basis (i.e. abundance) is about 50bps lower.
Note the rise in basis leading up to 8am Wednesday (London time, i.e. when Asia is online), with little rise in price. And then again around 18:00 (i.e. early afternoon in New York). And again 8:00 the next day.
Then the basis drops as the price drops. And rises as the price rises. Once the price is stable at its new level

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Why These Gold Standardites Are Wrong, 13 October

October 13, 2020

On Friday, the price of silver went up from $24.25 to $25.20, or +4%.
Let’s look at the graph of the price and basis (i.e. abundance) action.

For the first part of the day, the action is from speculators, for the most part.
Then around the time that the US west coast comes online, we see a continued rise in price but a drop in basis back to where we started.
Folks, this is what buying of physical metal looks like: prices rises by about 30 cents accompanied by a drop in basis from about 2.9% to just over 1.9%.
If this continues, there will be a much higher silver price, relatively soon. Let’s keep an eye on the basis action!
This is a good segue into a topic we see discussed over and over again.
Gold & Silver…and Inflation
Let’s look at three slightly different premises:

Gold (and silver)

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Silver Not Stimulated – 7 Oct

October 7, 2020

“I have instructed my representatives to stop negotiating until after the election when, immediately after I win, we will pass a major Stimulus Bill that focuses on hardworking Americans and Small Business”
So tweeted President Trump just before 8pm (London time) Tuesday afternoon.
And the price of silver, which was already down 40 cents, fell more than a dollar (some of the drop occurred after the cutoff of this graph, but the graph shows 60 cents).

Look at that! The basis is falling with each drop in the price. It rose with one price blip, but not a few others.
This is selling of futures by guys with leverage, not the selling of metal.
Indeed, the lack of basis rise when the price rises from $24.20 to $24.40 around 12:30, and again at 18:00, suggests buyers of metal are active today.

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Silver Falls, We’ve Got #$*&! Mail – 6 October

October 6, 2020

There was a big drop in the price of silver last Wednesday. Then the price moved up, and down, but mostly up. Let’s look at a graph of the silver price and basis showing Sep 30 through Oct 5, with intraday resolution.
Let’s take a look:

It’s remarkable how the basis tracks the price, until Oct 5.
When basis tracks price, this means the action is primarily in the futures market. At times when the price is rising, the basis is rising—which simply means that the spread between spot and futures is widening. At times when the price is falling, the spread between spot and futures is narrowing.
Picture a force pushing up or down on the futures price, and the spot price reluctantly follows. It is dragged along by arbitragers.
Until Monday October 5.
Early in the day, we see the basis falling

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Silver Rises, JP Morgan Manipulates! 29 September

September 29, 2020

While the silver price was dropping recently, we published analyses here and here.
At that time, we saw a basis that fell with price, but which recovered during “off” days. In short, there was not much of a decrease in abundance of the metal to the markets commensurate with the price drops.
On Monday, the price went up from about $22.95 to about $23.70, a gain of 3.3%.
Let’s look at the intraday price and basis action.

There are several trends.
The day begins with rising basis and falling price—selling of metal. Then falling basis and rising price—buying of metal. And falling basis and falling price—selling futures. And so on.
At the end of the day, the price is up almost a buck and the basis is up from 1.6% to 2%. This day, futures buyers pushed up the price. But they did not do all

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And Silver Crashes Some More! 24 Sept

September 24, 2020

A few days ago, we wrote about a big silver crash. The price dropped around 7.5%.
And the basis dropped from around 2% to 0.6%. At the end, we said:
“The key question is: what is the follow-through? If the price stays down and the basis goes back up, that will be a bearish signal. If the basis stays down, that means the silver market is markedly tighter at $24.50 than it was at $26.75.”
Which this brings us to yesterday’s silver dive.  Here’s the graph of the day’s action.

At the start of our graph, 2am (London time) the price is just a bit lower than at the end of the first crash day. $24.25. But we see the basis is up to 2.3%. That’s higher than it was at the beginning of the first crash day, when the price was $26.75.
Clearly, there was some buying of futures in the meantime. Perhaps

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Silver Crash! 22 September

September 22, 2020

On Monday, the dollar rose from 1.16 grams silver, to 1.26g.
Conventional monetary thinkers believe that the dollar can be measured either in terms of the euro, pound, yuan, etc. Or in terms of consumer prices.
But these are not units of measure.
And that’s because consumer prices are subject to huge forces pushing them both up (rising costs of compliance) and down (falling interest rates, and rising efficiency).
Using consumer prices to measure the value of the unit of exchange is like using the height of a seagull (or a flock of them) to measure the elevation of a boat that’s tossing in the waves, while slowly sinking.
The other currencies are dollar-derivatives. You wouldn’t use GOOG December call options to measure GOOG, would you? You wouldn’t try to literally lift yourself by your

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What’s the Price of Gold? It Depends.

September 17, 2020

When someone asks what the price of gold is, the answer depends on which gold market he means.
In most cases, the different gold markets are close enough that the minor differences are insignificant. TV news anchors just want to know if the price is in a major trend, up or down (up). Old Uncle Ernie could be reminiscing about the bull market of the 1970s and comparing the price back then to the price today (spoiler: it’s higher today).
The Three Gold Markets
But if you’re studying gold, you may be curious about the differences between the three markets:

Spot (also known as loco London)*
COMEX futures
Retail (i.e., physical coins and bars)

It must be emphasized that these are three different markets. That is, there are different buyers and sellers. Hence there are different balances of

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