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CRAZY Changes In SILVER Market Ahead – Andy Schectman
The silver market has recently been witnessing some truly mind-boggling changes, and according to precious metals expert Andy Schectman, things are about to get even crazier.
As the CEO of Miles Franklin, a precious metals retailer, Schectman has been in the industry for over 30 years and has seen his fair share of ups and downs. However, the current state of the silver market has him both excited and concerned.
One of the major shifts in the market that Schectman points out is the increasingly evident disconnect between the paper price of silver and the actual physical metal. The price of silver is primarily determined by futures contracts traded on the COMEX exchange, which are predominantly settled in cash rather than physical silver. This has created a divergence between the demand for physical silver and the price shown on the paper market.
Schectman highlights that while the demand for physical silver has surged, the paper market has not been able to keep up. Investors are rushing to purchase physical silver as a hedge against inflation and monetary uncertainty, causing a strain on the available supply. This discrepancy between demand and supply has resulted in significant premiums for physical silver.
This retail demand for silver has been fueled by several factors. One is the increased interest in metal investments among retail investors, who have been impacted by the economic fallout of the COVID-19 pandemic. These investors are seeking safe-haven assets that can protect their wealth in times of crisis.
Schectman also notes the Reddit-inspired silver squeeze movement as a driving force behind the surging demand. A group of retail investors organized through social media has been encouraging others to buy physical silver and squeeze the short-sellers in the market. This movement has garnered significant attention and has encouraged even more retail investors to jump into the silver market.
The impact of this increased demand for physical silver has led to problems in the supply chain. Schectman explains that several major mints and refineries have struggled to keep up with the soaring demand, resulting in delivery delays and skyrocketing premiums. This has only exacerbated the gap between the paper and physical silver prices.
Looking ahead, Schectman believes that the silver market is heading for even crazier times. He anticipates that the divergence between the paper and physical market will intensify, potentially leading to a significant price correction in the future. He advises investors to be cautious and consider diversifying their precious metals holdings beyond just silver.
Schectman also emphasizes the importance of owning physical silver and not just paper silver. He encourages individuals to take delivery of the metal and hold it in their possession to avoid potential future delivery issues and ensure they are protected against counterparty risk.
In conclusion, the silver market is experiencing unprecedented changes. The surge in demand for physical silver, driven by a combination of retail investors and the silver squeeze movement, has created a significant disconnect with the paper market. As Andy Schectman warns, this situation is likely to get even crazier in the coming months, making it crucial for investors to stay informed and adapt their investment strategies accordingly.
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