Something bigger and more important than the GME short squeeze is beginning: a silver squeeze. The mother of all silver squeezes. A visit to www.reddit.com/r/Wallstreetsilver may convince you to join this movement. You may change how you spend your increasingly worthless Federal Reserve Notes and, just as importantly, you may find your people.
Wall Street Silver – The Beginnings
You are, no doubt, aware of the Gamestop squeeze and Wall Street Bets. Before the Gamestop squeeze, there was on Wall Street Bets a robust discussion of a potential silver squeeze. However, as the GME frenzy intensified, WSB moderators began deleting posts about silver and people making silver posts were blocked. Recognizing the silver welcome mat was no longer on the threshold, Wall Street Silver (WSS) was formed – Jan 29, 2021.
WSS is growing at a steady pace: over 60,000 now and adding several thousand new members a week. You will find WSS is one of the most encouraging online communities you’ve ever experienced.
Want to get hundreds of people to like your post? Follow this simple formula:
- Find some of your increasingly worthless Federal Reserve Notes (FRNs)
- Go to your LCS (local coin shop)
- Buy some shiny (silver)
- Take a picture of your investment (in your car, on your table at home, with your dog guarding it, in your safe, wherever)
- Write up your experience (note that you’re new to the community)
- Post it on WSS.
- Within a few hours, you’ll have 100s of upvotes and dozens of encouraging comments. Here’s the thing though. The comments will be sincere – no matter the size of the stack you post. You’ll be encouraged to repeat the effort and you’ll come away feeling like you just did something for the good of humanity (you did). I dare you to try it.
The Silver Squeeze: Why It Should and Could Happen
Why squeeze silver? First, the silver price is heavily manipulated by the big banks. They have used illegal means to reap massive profits at the expense of the smaller investors (read: you and me).
And, no, this isn’t a conspiracy theory. Last year, JP Morgan was fined $920 million for its eight-year role in manipulating the precious metals markets.
Next, there are rumors that some of these big banks have large outstanding short positions. Ted Butler estimates that Bank of America, for example, may have a 500 million ounce short position (A New Piece of the Puzzle) at ~$18/oz. A silver squeeze driving the price to $50 would bring a welcome penalty to the BoA criminals.
Finally, Wikileaks published a document showing that the precious metals future market was instituted with the explicit purpose of defrauding us:
“To the dealers’ expectations, will be the formation of a sizable gold futures market. Each of the dealers expressed the belief that the futures market would be of significant proportion and physical trading would be miniscule by comparison. Also expressed was the expectation that large volume futures dealing would create a highly volatile market. In turn, the volatile price movements would diminish the initial demand for physical holding and most likely negate long-term hoarding by U.S. Citizen.”
Enter stage left: JP Morgan… Given that JP Morgan was simply meeting the expectations established by the “dealers”, the fine almost seems unjust. However, if you look at the fine as just a kickback for their participation in the market manipulation, the whole affair makes more sense. The fine was just a business expense; no one went to jail.
Those are some of the ideological reasons for squeezing silver.
On the practical side, they’re almost giving away silver right now. The nominal high was $48. The inflation-adjusted high for silver is somewhere between $165 and $950 (depending on the source you use for inflation estimates).
Right now, the price is around $26.50. Industrial demand is up (think solar panels and electric vehicles), investment demand is up (more about that in a minute), and supply is down (think mining reductions due to COVID). The Federal Government has become completely unhinged and is inflating the money supply like never before (over 26% of all FRNs were issued in the last year).
The coming inflation (if you follow lumber prices, food prices, gas, corn, housing, whatever, you might find my use of “coming” as dated) will drive a move to commodities as an inflation hedge. Already other metals are at or near their all-time high. It’s only a matter of time before silver follows.
Making a Difference
By all accounts, their efforts are making a difference. Recently, the LBMA published a paper acknowledging that in February this year, with the first wave of the squeeze, they came very close to running out of physical supply: “Early 2021 saw an unprecedented 110Moz added in just three days. Although some liquidations emerged, there were concerns that London would run out of silver if ETP demand remained at a high level” (https://cdn.lbma.org.uk/downloads/Publications/LBMA-Silver-Investment-2021-Report-Final.pdf). Online bullion and coin dealers have shortages of many products.
The squeeze has also shined some light on other silver shenanigans.
Perth Mint customers reported that they were having difficulty obtaining allocated and unallocated silver they had stored with the mint. The head of the Perth Mint, Richard Hayes, in an interview conducted by an Australian newspaper, referred to a subset of his current and potential future customers, disparagingly, as “keyboard warriors.” It seems he believes that having too many customers for his product is bad for business and he is not pleased that so many people are asking for delivery and questioning whether the Perth Mint really has the silver they claim to have.
The Perth Mint then published a photoshopped (alleged) image of an employee standing amongst a bunch of silver bars, just to ensure everyone that they really do have plenty of silver, even though they were telling their customers it would be 3 – 6 months before they could have their silver (the contract had promised 10 days), dramatically increasing the fees for taking physical possession, shipping bars made in China (despite customers having paid for Perth Mint bars), and placing lifetime household restrictions on how much silver one could buy. Not really the activities you’d expect from a supplier awash in product.
The Perth Mint isn’t the only silver player to have had problems. SLV recently amended its prospectus. Before it was amended, people questioned how much physical silver SLV owned (the prospectus is filled with ambiguity). Now, the amended prospectus removes any doubt (hint: PSLV is more likely to have the silver they claim to have [not investment advice – I’m just a stupid ape]) that they do not have physical silver to support the shares.
WSS Goals and Activities
You see, WSS is more than just a shrewdness (Wall Street Silver members refer to themselves as apes and “shrewdness” is a group of apes – I had to look it up) committed to stacking silver. They’re part of something larger. They believe that through their combined efforts they’re going to change the financial system. Their core beliefs include:
· Silver is the real currency. Dollar, Euro (and everything else) is just paper
· The central banks have been printing currency irresponsibly
· Silver and Gold will protect investors against currency devaluation and inflation
When visiting WSS you will see some common themes. One is a discussion about how to best accomplish the squeeze (read: sticking it to the big banks and government agencies colluding in the silver market). Some advocate for buying physical and taking it off the market. When you buy it and hold it, you know that it hasn’t been rehypothecated (sold to multiple people simultaneously – the silver version of fractional reserve banking) and it is yours. Some advocate that buying PSLV is the best way: no outrageous premiums (coins are $10 over spot) and the good people at PSLV are buying 1000 oz. bars OUT OF THE VAULT (apes often capitalize that phrase) and having the RCMP guard it somewhere in Trudeau-land. There is a common understanding that SLV is detrimental to the cause and should be avoided.
You will also see talk about advertising. Some apes have bought space on billboards. One ape had the idea for an advertising GoFundMe. In March, he asked for $10k. Within two weeks, apes contributed over $110,000. Billboards are coming soon. 60k is a great start, but it’s just a start. The WSS community realizes that their strength and influence requires a large shrewdness.
You will see plenty of DDs (Due Diligence) posts, written by the smarter apes, explaining how the silver markets work and the current status. One ape was successful in getting a silver DD posted on WSB (there was lots of chest pounding in the shrewdness with that one). There are many great DDs and some of them are pinned to the top of the WSS thread. To avoid missing important contributors, I’ll not name any specific apes here.
By far, the most common posts are pictures of shiny stacks. They love ‘em; can’t get enough.
Right now, you will find lots of talk about the next silver raid. On May 1st, they’re going to raid the silver market. Over 100,000 apes and soon-to-be apes will each purchase 100 oz. (or more) of physical silver or PSLV. In a market that’s already tight, 10 million ozs. should shock the system, but will just be another inning in a longer game. The LBMA assures us they have a plan: “This also pre-supposes there is no repeat of the social media frenzy. Should this occur, higher prices would almost certainly be triggered, which would be met by heavy selling.” (page 8, https://cdn.lbma.org.uk/downloads/Publications/LBMA-Silver-Investment-2021-Report-Final.pdf)
What you will not find, and something that sets WSS apart from WSB, are people sharing stories of large investment losses. Apes don’t sell; they’re in it for the long game. On the silver price dips, apes look heavenward and thank JPM (apes aren’t bright, they know JPM is evil, but good comes from sky and cheap shiny is good so they look to the sky) for smashing the price so they can buy more shiny.
Paradoxically, its when the price rises that apes have the greatest feelings of angst: they have to wrestle with FOMO (fear of missing out) and regret (wishing they’d bought more back at $20/oz). Apes are also fond of pointing out that when the banksters smash the paper price, the physical price remains fairly consistent – so there’s no real loss.
In 20 years, your kids/grandkids will ask if you were part of the great silver squeeze. What will you tell them?