Silver Squeeze: Is this the BIG ONE?
Personally, I’m having an each way bet: a scattershot of energy related call options expiring over the next two years and keep plugging away at stacking the PMs and building up my land and diversifying my income sources. Not real sophisticated but it’s about the best I can do given capital and time constraints.
Demand going up … and supply? Going down, because of years and years of manipulated, faulty price signals;
I hope we can keep a conversation going on this subject here. Ive got nothing against the crypto guys but talking about something other than bitcoin is nice too.
So far, I think the real play here is that the retail crowd starts to muscle out the industrial users who will then start acquiring the metal in a strategic way at whatever price is necessary.
What makes industrial Silver use so interesting is that it is both indispensable and not a huge part of the final price of any given widget. So if there are a few grams of silver in the solder of your iphone, or 2 ounces in your Tesla, the price can go to $100 or more per ounce and it won’t really increase the price of the iphone or the car very much. and yet the producer of the product *must* have that silver.
So Elon and Cook and others must be quietly aquiring strategic hoards of Silver, not because a sudden price spike will ruin their businesses but out of fear of the risk of sudden complete unavailability of metal which would stop their assembly lines cold.
This thing could really blow at some point. Its not Copper and it’s not Gold. Its a really unique market.
I believe that the price manipulation has more room to run, and probably has some backstops we haven’t thought of; but it is coming, the weakness of digital anything is highlighted by this: https://www.minds.com/CorbettReport/blog/our-digital-gulag-1217856461100384256
When I travelled in Japan a few years ago I was surprised at the ‘cash economy’ outside of the tourist areas, various forms of credit debit cards not being used at all; so it will be interesting how this is addressed by the digital oligarchs.
The reason cited for Rhodium’s current sky high price is that it is a “by-product” of mine production.
That sounds a little familiar silver-wise.
However the Strong Dollar policy (SDP) is funded by an increasingly large supply of increasingly worthless $$.
SDP being associated with normal currency manipulation.
I have a feeling the big movers for Silver will be related to –
* a large manufacturer, e.g. Apple, becoming a Silver buyer. Although they already are, they buy Silver Solder paste, for example.
* one of the pseudo-celebrities getting behind it, e.g. Elon Musk.
We used to have a strategic stockpile of silver. Gone, now.
I wonder if silver will be confiscated, this time? I think it’s in the original law.
“I believe that the price manipulation has more room to run, and probably has some backstops we haven’t thought of; but it is coming”
I guess it all comes down to narrative. Do we believe that Gold as FX is manipulated downward to make the USD appear superior? Do we believe that Silver has a monetary component? If so, do we believe that its easier to hold PMs down by suppressing the relatively tiny Silver market rather than focusing solely on Gold?
If the above is obviously conspiracy theory to you, then Silver is at best the only industrial commodity yet to have a big run up in price so you might invest for a nice little score.
If the above is obviously true to you, then… yeah… how hard will they fight to keep the lid on this thing and how much punishment will be heaped on retail silver investor when it blows? I own a lot of PSLV in registered accounts which will come in handy when a windfall profit tax is levied but not so handy when my Prime Minister cravenly raids the Royal Canadian Mint Vault at JP Morgan’s first request.
I heard lots of crowing earlier, that stupid Canada sold all of its govt. held precious metals. My thought was/is, just wait until they nationalize all the mines.
Be careful who holds your physical.
>> I guess it all comes down to narrative. Do we believe that Gold as FX is manipulated downward to make the USD appear superior? Do we believe that Silver has a monetary component? If so, do we believe that its easier to hold PMs down by suppressing the relatively tiny Silver market rather than focusing solely on Gold?
A lot of the Strong Dollar policy is laid out in Policy Papers with euphemistic sounding names. The kind of thing Jim Rickards talks about some.
Just the combination of what the Fed scribes have to say about the Strong Dollar policy, which may be difficult to access – it’s not on a page 1.
+ the obvious price action.
It would be good to hear from the experienced traders like Rick Rule or Andrew Maguire, what possible financial situation drives Silver and Gold trade where they are dumping large quantities without trying to get the best price ?
This counter-intuitive trading of large quantities of paper silver is its own Fingerprint. It’s like they’re Pawning the family silverware to pay the rent, x 1000, desperation sales of LARGE quantities – who does that ?
Of course once those contracts are created, they have to be satisfied and/or unwound. That’s where the insights of Rick Rule etc. are helpful.
And when the Sellers that create the price waterfalls find themselves painted into a corner, who comes to their rescue ? The contracts usually allow the 2 parties to “settle in cash”.
We have limited access to information about the details.
To be more of an insider one would need to join the CME, & trade the 5000 ounce silver contract, ask for physical delivery & see what happens. $10,000 to join the CME & $135,000 for the 5000 ounce contract ?
If the “settle in cash” part means you agree not to talk about the settlement, we really need a Brave Volunteer to share the details of those transactions.
There’s not much transparency about “Settle in Cash”. That’s what makes me think the members are legally restricted from sharing the details.