Silver goes ballistic and shakes the financial system

[Mike]

I've been talking a look at what this guy has been posting about silver. Overall, I've found him worth checking out. Here is a tweet from today. I think it is pretty accurate to look at what is happening with silver (and other commodities - rare earths article posted earlier, etc) as one aspect of an ongoing war that just hasn't gone directly hot between the US and China/Russia and the US's potential attack on Iran is directly related to this.

https://twitter.com/x/status/2016974888934822100

I'm now going to explain the reason to you, but it's not exactly easy to swallow. It has to do with the fact that we're standing on the brink of a hot war.

The USA is currently in the process of losing financial control over the world. Trump is downplaying the weakness of the dollar, but it's clearly happening.

This is also evident from the fact that in Shanghai, the premium over Western silver prices continues to hold in the area relevant for VAT (when physical delivery takes place). That means the West has lost pricing power over raw materials and can only prevent metals from flowing out of the West by grudgingly going along with the higher prices and matching them.

China is doing this to demonstrate that it has now also gained financial dominance—after already leading energetically and economically for years.

The USA has recognized that it has one last chance to retain control, by attacking. Right now, the USA no longer has control over raw materials in general, but in oil it still holds an asymmetric advantage that it could use.

Just recently, the USA removed Venezuela from China's list of oil suppliers. They're now moving heavy military equipment into the Middle East to threaten China.

By doing so, they're signaling: If China doesn't stop pulling silver and gold out of the West in order to claim their top spot, then the USA will use force to defend that position.

Because if China lost the Strait of Hormuz, it would suffer at least a short-term tactical defeat—since ~40% of its oil supply would collapse. And in a total war of attrition and attack by the USA, China might no longer be able to sustain its army's supply lines to defend its homeland long enough.

The question now is whether China has prepared fast enough for this scenario and can outplay the USA by allowing the shift from Iran toward the USA, or whether it will push back, continue supporting the Iranian regime, lose its oil in the short term as well—but not in the long term.

Unfortunately, I can't look into the true stockpiles of the countries to judge whether China can buffer a loss of oil control via Russia and therefore will retreat and allow a regime change or whether it will fight over it through water mines in the strait.

This reminds me of this question and answer with the C's from about 10 years ago. I think Russia working with China is about to take the queen in terms of the reality of commodities and economics and silver (and gold) has at least some major part to play in that actuality.

(Perceval) Yes. I wanted to ask about the extent to which the US and the powers in that camp have been checkmated by Russia and Putin? They seem to be extremely quiet. All they can do is talk a lot of nonsense and throw silly accusations around...

A: Not checkmate just yet, but the queen is certainly in danger of being taken.

Q: (L) That's not bad.

(Niall) Is the queen Israel? [laughter]

(Chu) You wish!

(Perceval) No...

(Pierre) Unlike a chess game with these nuclear powers available, Israel for example can just drop the whole chessboard and everybody loses.

(Perceval) There's something I've been saying to various people, and I'm wondering if it's true or not. The stories in Richard Dolan's books about US nuclear missile sites being disabled by UFOs at various places so that they couldn't fire anything way back in the 60's at the height of the Cold War. Was that a message to the Powers that Be that no nuclear war would ever be allowed? Did 4D STS send a message in that way that nobody would be allowed to push the button because you'd kill everybody. Since this world is like a farm, their cattle would all be killed. Is that anywhere close to the truth?

A: Close.

 

[SummerLite]

I've been talking a look at what this guy has been posting about silver. Overall, I've found him worth checking out. Here is a tweet from today. I think it is pretty accurate to look at what is happening with silver (and other commodities - rare earths article posted earlier, etc) as one aspect of an ongoing war that just hasn't gone directly hot between the US and China/Russia and the US's potential attack on Iran is directly related to this

I've heard of this theory recently as well with a few differences. The USA is fearful China is gaining to much power around the world and having their oil supply under control would place restrictions on them especially if they wanted a war. So there the US is off the coast of Iran. Another idea involving military tactics, if China did intend to become to power hungry (which some in the US claim) then this would threaten Russia as well so therefore they would choose to align with the USA which would make China unable to gain total control.

I can't see the US starting a hot war with China though, that would be catastrophic. So far they're using other means like trade wars.

Lots of ideas circulating, its interesting. There could be something to this, controlling China's oil.

 

[axj]

The USA is fearful China is gaining to much power around the world and having their oil supply under control would place restrictions on them especially if they wanted a war.

There seems to be no indication that China wants a war, while the US is close to starting one with Iran to disrupt China's oil supplies.

Another idea involving military tactics, if China did intend to become to power hungry (which some in the US claim) then this would threaten Russia as well so therefore they would choose to align with the USA which would make China unable to gain total control.

It is extremely unlikely that Russia will align with the US instead of China. Russians do not trust the US or the West at all anymore and openly call them "not agreement capable".

 

[SummerLite]

There seems to be no indication that China wants a war, while the US is close to starting one with Iran to disrupt China's oil supplies.


It is extremely unlikely that Russia will align with the US instead of China. Russians do not trust the US or the West at all anymore and openly call them "not agreement capable".

It's hard for us to tell what exactly is going on behind the scenes. It's not like any of these countries/leaders will come out and tell us all the intelligence they have on each other. I'm not going to assume right off this is totally false. It's better to see if more evidence comes to support or deny. Russia is more a natural ally to the US then China and they've been allies in the past. But maybe things will dramatically shift and the script is totally changed in some way. Life is full of surprises.

 

[axj]

Russia is more a natural ally to the US then China and they've been allies in the past.

When the USSR and the US were allies, China was their ally as well. Now both China and Russia want a multipolar world (BRICS, dedollarization, etc.) while the US seems to want to keep as much dominance as possible.

It's hard for us to tell what exactly is going on behind the scenes.

Some things can be seen more clearly than others. That Russia will stay aligned with China and the BRICS (unless something dramatically changes) seems to be pretty clear.

 

[SummerLite]

When the USSR and the US were allies, China was their ally as well. Now both China and Russia want a multipolar world (BRICS, dedollarization, etc.) while the US seems to want to keep as much dominance as possible.


Some things can be seen more clearly than others. That Russia will stay aligned with China and the BRICS (unless something dramatically changes) seems to be pretty clear.

Russia also played a role in America's early years. I like seeing the cooperation thats happening now with Trump and Putin.

Catherine the Great

The original Thirteen Colonies began to engage in trade with Russia in 1763, in violation of the Navigation Acts. During the Revolutionary War, Russian Empress Catherine the Great decided to remain neutral in the conflict, despite British pleas for assistance. The Empress was sympathetic to the colonists and believed that an independent America would be beneficial to Russian commercial interests in North America. Russian neutrality proved significant for the victory of the American rebels. After the Revolution, the liberal-minded Tsar Alexander I famously corresponded with Thomas Jefferson and expressed his “great esteem” for the American project, which he viewed as a potential model for reform in Russia. In addition to the Tsar, several participants of the 1825 Decembrist Revolt were also influenced by the American Republic.

As the American Civil War unfolded, Tsar Alexander II pledged in a letter to President Abraham Lincoln that Russia supported the “maintenance of the American Union as one ‘indivisible nation.’” In 1863, the Tsarist state dispatched part of its fleet to the ports of New York and San Francisco with visits to Boston and Washington. Grand parades and elaborate balls were held in their honor. Indeed, the Union interpreted the Russian presence as a sign that Petersburg would intervene on their behalf if Britain and France chose to side with the Confederacy. However, the motivation for Russia’s action was not limited to a desire to support the Union alone. Fearing a possible British or French attack, Petersburg also sought to remove its ships from home waters and station them in Union ports.

How Many Times In History Russia Helped America? - Helleniscope

PAINTING ABOVE: Russian battleships in New York depicted by Harpers Weekly in Oct. 1863. EDITOR’S NOTE (Nick Stamatakis). The corrupt Washington DC establishment has been trying to brainwash all Americans that Russia and the U.S. are eternal, sworn enemies, but those among us who love history...

www.helleniscope.com

 

[Cosmos]

According to this german article one of (if not) the main drivers of the resent extreme explosions and volatility of precious metals (gold and silver being the chief ones) is actually that trust/confidence in fiat money is collapsing rather rapidly more or less globally. And specifically those fiat currencies of developed economies (probably Dollar, followed by the Euro). IMO that is pretty likely the case.

The gist of the article translated into english:

Contrary to widespread narrative, we are currently not witnessing a genuine 'de-dollarization,' but rather a comprehensive and global loss of confidence in fiat currencies and government bonds of developed economies.

 

[Cosmos]

IMO it could very well be that some of the recent and not so recent actions of the empire and/or Trump have and will continue to reverberate through the system in waves and somewhat with a lag.

And it will probably continue to be reflected on higher prices and volatility in silver and gold for quite a while.

For example: What “Trump“ did with/in Venezuela might just be one of those things. Things like that cause real world consequences that reverberate through the system until it is reflected in gold/silver after some lag of time to the original event: The Venezuela thing among many others causes stake holders, and other countries to loose confidence/trust in being safe partners with the empire, after which ever more such entities are looking for more safe ways in which they can invest outside of the empire and of course be less dependent on Dollar/Euro in that way as well.

And the safest and easiest option has always been gold followed by silver. And many such entities do that now, and ever increasingly so with every new crazy move of the empire.

 

[dennis]

Gold plunged to @ $4,700, silver to @ $77
New Estee Lauder Fed Chair and weak dollar rebound per Bloomberg

 

[Aeneas]

Gold plunged to @ $4,700, silver to @ $77
New Estee Lauder Fed Chair and weak dollar rebound per Bloomberg

I agree with what some have written that it has nothing to do with the new Fed Chair and instead a concerted attack. Again, that is why buying gold or silver for short gains is a bad idea.

In isn't like the suddenly manifested a lot of physical gold and silver out of thin air and a lot to do with paper contracts being dumped big time. For those who thought of buying gold or silver, this is probably the best opportunity. Gold is already clawing back rapidly and now stands at $4900 and with silver at $82. The thing is finding a someone who will actually sell it.

What was interesting is that the exchange didn't activate the circuit breakers which they apparently otherwise do if the price increases/falls by 10%. It will be interesting to see the fall out from all this volatily today and an explanation once the dust settles as to what happened.

 

[Natus Videre]

Gold and silver prices will most probably rise again, but it's surely a cold shower for the highly leveraged, amateur traders that "aimed for the moon." One of the goals of market manipulation is to deter people from escaping the system.

Q: (L) Enough. The other day I experienced one of those extended pre-sleep states, and it seemed that I was in a class and there was someone explaining things to me. What they were telling me was that during this Christmas season [the Christmas season of the dream], certain steps would be taken by those controlling the economy, and that after Christmas, in January and February, a whole lot of stuff was going to be put into motion to send the economy into a dive of major proportions. It was not clear that it was THIS year, but that it was right after a Christmas. Can you tell me where this information was coming from, and what was I experiencing?

A: This is a long and complicated subject, but we will do our best to explain it. What you were seeing was one possible future. The economy of our 3rd density world is entirely manufactured. The forces that control it are both 3rd density and 4th density. There are conflicting opinions in the 3rd density sector right now as to when, where, and how to institute an economic depression. This has been "in the works" for quite some "time" as you measure it. So far, the forces arguing against institution of a collapse have prevailed. How long this condition will be maintained is open to many outcomes. Also, please be aware that the state of the economy is entirely an illusion. In other words, the world economy performs solely based upon what the population is told to believe.

 

[axj]

I agree with what some have written that it has nothing to do with the new Fed Chair and instead a concerted attack.

I think the new Fed chair may be a part of the reason. It seems that at this point they are trying to find the "sweet spot" between keeping the financial system (and the US debt servicing ability) alive through money printing, but without the dollar going into too much inflation because of that.

In a sense, it seems to be a "damned if you do, damned if you don't" scenario and the only question is whether the major currencies or the financial system break first. It seems that supporting one destroys the other and that they have been doing this balancing act so far by not going too much in eiither direction.

The system seems unsustainable for much longer, maybe another year or a few years if they really want to keep it together. Or maybe at some point they will let it crash, if they are confident that they have everything set up to get through it. What may complicate matters is the rivalry with China, which may decide on a different approach and timing to reset the world financial system.

On a more practical note, now is probably not a bad time to get some physical silver if necessary.

 

[dennis]

Could Warsh be a CBDC advocate wolf in sheep's clothing? The way I see it all crypto is a precursor to CBDC. Lower interest rates will further inflate the dollar and erode its purchasing power. This will drive the seeking of alternatives further. Problem> Reaction> Solution.

Though skeptical of cryptocurrencies as money, Warsh has invested in crypto startups, supports central bank engagement with digital money and is viewed as pragmatic rather than hostile to crypto

Who is Kevin Warsh: Trump's Fed chair nominee's return sparks bitcoin jitters over rates, balance sheet cuts

Crypto investors fear tighter monetary policy under Warsh, who once called bitcoin ‘software pretending to be money’ but backed blockchain innovation.

www.coindesk.com

 

[Carl]

Still if that happens, the ride there will be extremely wild, with real potential of -30% moves in a single week. I'd expect there to be some FUD story at some point they use to trigger, like "somebody found a way to make electronics with zero silver", or to borrow a joke from Francis Hunt, "oh look there's a million ton asteroid of pure 99.999 silver, and it's on course to crash right through the front gate of Fort Knox!"

Well there it is, closed the week -20%, or -30% measured from the dead high, with a wick down to a whopping -40% from tip to tip. Interesting that there was no big news story to trigger it though, they simply smashed the sell button and all bid was pulled. People are scrambling for a narrative now. The real volume showed up in the final few minutes of the move from 1:20-1:40 EST indicating a decent climax low set for now.

The western paper price is now trading at an astonishing 32% discount to the shanghai spot price:

China Silver Price Today in USD | Shanghai Premium - MetalCharts

Track the China silver price in dollars (USD) in real-time. Live SGE prices converted to US dollars for easy comparison with Western spot prices.

metalcharts.org

Everyone seems to have all the narratives and know exactly what's going on. Someone big blew up, they're shorting it for month end, China this, China that etc., but IDK I didn't get the memo. Realistically we can only guess.

One thing that never changes across all markets is the shape of price, which is the shape of the emotions driving price (or rather, the emotions being farmed from the participants by the 4dSTS operators). These do often follow familiar patterns and can sometimes be used to get a map.

Sentiment now is pretty split; plenty of metal bugs are coping hard and "buying the dip" with imaginary spare money, but also plenty of traders are calling the final top, gloating and laughing. My blink based on that would be that it chops around for a while and slowly grinds back up, but we'll see.

On sentiment/emotional patterns, since we're in complete clown world and everything trades like a memecoin now, I've been looking at a funny historical analogue. Particularly I've seen how the structure and the sentiment in silver line up well with the 2017 run in BTC.

There were a number of times BTC experienced brutal selloffs of 38% in July, 40% in September, and 30% in November. Each time it felt like the end of the world for holders, with a lot of people being ejected at the lows, and with sentiment being similarly split as we see now in silver market. Then one day in mid December 2017, we had another 42% drop, but this time sentiment was no longer split. Every single person wanted to buy it, and it was hardly possible to find someone calling for the end. Turns out, it was the end of that cycle. This was after all the celebrity attention and all friends/family wanting to get in.

I don't see any of that in metals yet FWIW.

Also the chart is kinda cool. Please don't take this seriously as a "fractal" or a path to trade off, it's just whimsical.

 

[Aeneas]

I took this screen print of todays happening:

What is interesting is that despite the big drop, gold has put on $559 since the beginning of the year. Silver was hovering at around $71 at the start of the year. It is good to not lose perspective.

As @Carl said:

The western paper price is now trading at an astonishing 32% discount to the shanghai spot price:

Paper contracts got sold but the physical metal still carries some value for a rainy day.