Not altogether certain these are a factor at the present time. True, they are un-backed and thus doomed to fail, but a dropping price actually helps strengthen them. Remember, nobody is actually taking any physical bullion out of the funds.
Huge factor at the present time! Main culprits are the hedge funds. Investors want money out, margin calls are ringing, Au and Ag are the only things they can sell and still book a profit.
Mixed. Investors can always liquidate some or all of their margin stocks (or the broker/dealer will do it for them). About the last thing most want to do is bail out of the one asset bound to rebound, especially in an instant (e.g. think Middle East).
On the other hand, the increased margin requirements at the Comex is indeed a factor, although much less of one since they have boosted them about a dozen times in the last few months. See Market Manipulation below.
Actually, gold is money, despite the Bernack's idiotic statement to the contrary. PM's are difficult to move (bulky, heavy, expensive to transport, etc.) and can be sold and then repurchased at a different location, but most of these transfers are made without disrupting the market.
This is a factor, but is probably overrated.
Technical analysis is most helpful when fundamentals are unchanging. This is not the case at the present time.
Without a doubt, many of the algorithms used by the hedge funds are firing off right now, but this will probably not be much of an issue for very long.
Inflation is rampant and virtually every developed country is monetizing vast amounts of sovereign debt. Deflation is not a problem at this time.
Commodities are falling because economic production is dropping - thus demand is, or will soon be, down substantially. However, this is not the case for PM's. Gold has limited industrial applications and silver's uses, while significant, are generally inelastic (e.g. medicine and antibacterial), or booming (e.g. smart phones and DVDs).
Banks and governments manipulate the hell out of PM's using numerous techniques, especially naked shorts. It's called the preservation of wealth effect. People panic when they see their currency trashed with respect to PM's. At the present time, the big banks are hung out to the tune of tens of billions in terms of paper losses and they are coming up on year end. Unfortunately, the price is dropping without knocking many leaves off of the gold tree (or in other words, the effect is temporary because they still have to come up with the bullion somewhere). Moreover, it looks like they are about to lose control of the market. Gresham's law anyone?
There is one of the largest runs in history going on at the present time as money is fleeing the European Community in advance of its collapse and the collapse of the Euro. For this reason, the Fed is printing a ton of money and "loaning" it to the ECB for the short term (until after the EOY banker boy bonuses). This is boosting the demand for dollars through the roof, and the price of gold is inversely proportional to the price of gold.
Rumor has it that several eastern European banks (e.g. in Poland and the Baltic Countries) are being forced to sell gold in order raise dollars. Maybe.
The Fed are masters at subterfuge. Bernack has denied QE3. However, they are printing money for liquidity (see above), are about to bail out the IMF (again), and are propping up European banks. They are indeed "twisting" some of their short term debt into longer maturities, but while this addresses the problem of paybacks, it no way addresses the problem they have with ongoing deficits of $100 billion per month and rising. The current "solution" of reverse repos applied to GSE trash with big banks acting as middlemen is ... by any other name ... printing money to boost bank reserves and fund deficits ... which by any other name is quantitative easing. And people are stupid enough to believe the Fed line ... for a while yet.
A very good post. As a small aside, I believe DVDs and other such discs use aluminum, not silver.
I don’t know for certain, except that if there were silver in them, they’d be recycled.