TLDR;
The video discusses the current silver market, highlighting widespread shortages and increasing demand. It points out that silver is becoming increasingly difficult to obtain, with many dealers and mints worldwide reporting being sold out. The video also touches on historical parallels, particularly the market conditions during the 2008 financial crisis, and emphasizes the fundamental shift in the silver market from surplus to deficit.
- Silver shortages are being reported worldwide, including in Australia, Canada, the UK, and Vietnam.
- Dealers are struggling to maintain inventory, and premiums on physical silver are rising significantly.
- Central banks are beginning to purchase silver as a monetary asset, further straining supply.
Silver Shortages Worldwide [0:23]
The silver market is experiencing widespread shortages, with reports from various countries indicating that silver is becoming increasingly difficult to obtain. In Australia, Africa, Canada, and Vietnam, supplies are depleted. Costco locations in Ontario are out of silver and gold, and the Royal Canadian Mint has sold out of almost everything. Perth Mint is out of kilo bars. A dealer in Vietnam reports having no more stock for sale and uncertainty about acquiring raw materials to continue production. The UK is also experiencing silver shortages, with dealers awaiting stock and setting up stock alerts.
Market Analysis and Historical Context [4:24]
The speaker explains the terms "unaffordium" and "unobtanium" in relation to silver prices. "Unaffordium" is when the price of physical silver diverges from the spot price due to high demand. "Unobtanium" is when silver becomes completely unavailable. The speaker recalls the 2008 financial crisis, during which he experienced similar shortages at goldsilver.com. During that time, the US Mint put dealers on allocation, limiting the amount of silver they could purchase. The speaker notes that during the peak of the crisis, his company was briefly out of silver products entirely, and when they had gold, it was only in the form of expensive kilo bars.
Global Demand and Market Dynamics [7:56]
The video references a report from Bald Guy Money, which highlights the high prices dealers in Poland are paying to buy back silver coins from customers, up to $55 an ounce. This indicates strong global demand and a willingness to pay premiums to secure physical silver. Dealers are increasing their spreads because they know they will be unable to replace their inventory once it is sold.
ETF Short Squeeze and Market Deficit [10:40]
The video discusses a potential short squeeze in the silver ETF SLV, noting that borrowing fees for shorting SLV shares have exploded higher, with very few shares available to short. Despite SLV creating 5 million new shares, none were available to borrow, and borrowing fees remained high. The video also points out that the silver market has shifted from years of surplus to a period of large, persistent structural deficits. Above-ground stockpiles are being drawn down, and central banks have started to buy silver as a monetary asset.
Investor Behavior and Final Thoughts [13:35]
Bullion Star reported a 3:1 buy-to-sell ratio in September, indicating that customers are aggressively accumulating silver rather than taking profits, even at all-time highs. This suggests that investors prioritize physical ownership due to concerns about currency debasement, global uncertainty, and institutional instability. The speaker emphasizes that while dollars can be printed, silver cannot, reinforcing the importance of owning physical silver.