by Hebba Investments, Seeking Alpha:

Long time commodity investors are stunned by the recent events in the precious metals markets. Gold’s 2-day drop of 10%, after a year and a half long consolidation, had commodity specialist Dennis Gartman saying that in his 40 years of trading commodities “he has never seen anything like this.” “Panic is everywhere,” Gartman told CNBC. We completely agree – recent trading in gold and silver show signs of panic liquidation in the paper markets, while bullion dealers are reporting extremely strong physical sales.

Silver Opportunity for Investors

Silver hit an intraday low of $22.92 in late Asian trading, and is currently trading in the $23 range. We believe the silver price is unsustainable on the long term at these levels as the costs of mining silver are in the mid-$23 dollar range (as we showed in a prior article) and the spot price is currently at or below these levels. This screams buy for patient investors since commodities that are priced at the same level as their costs of production offer a rare opportunity for investors to buy up the physical commodity for less than it costs producers to produce it.

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