Chris Marcus: Silver Supply Crunch Not Over, Price Path Clear Long Term
Summary
Precious Metals Sentiment: Conference conversations indicate mixed but improving sentiment, with many seeing recent pullbacks as buying opportunities while awaiting a potential resumption of the rally.
Silver Market Dislocation: The guest details a persistent supply/demand mismatch, London backwardation, COMEX outflows, and India’s inability to source silver, suggesting the deficit remains unresolved.
Gold Outlook: Long-term bullish case remains intact given unresolved drivers, with discussion of potential policy-driven revaluation and the plausibility of materially higher gold prices over a multi-year horizon.
Bank Activity: Large banks are reportedly hiring more gold and silver traders and expanding vaulting services, signaling rising institutional engagement; firms referenced include JPMorgan (JPM) and Goldman Sachs (GS).
Policy & Dollar: The conversation highlights a push toward a weaker dollar and structural shifts under the current policy regime, which would be supportive of higher precious metals prices.
Gold Revaluation: The guest outlines how remarking Fed gold certificates to market could bolster Treasury balances, increasing the incentive for a higher official gold price over time.
Risks & Volatility: Sharp advances can invite sharp pullbacks, but recent weakness is framed as normal within a larger bull trend given ongoing supply constraints and macro tailwinds.
Investment Stance: Emphasis on maintaining a long-term perspective in gold and silver, using structural deficits and policy shifts as core elements of the thesis.
Transcript
I'm Charlotte Mloud with investingnews.com and here today with me is Chris Marcus, founder of Arcadia Economics. Thank you so much for being here the first time in person. >> Charlotte, I'm honored to be here. It's just wonderful to see you as always and um certainly as usual interesting times in Gold and Silverland and nice to be here in New Orleans where people seem happier this year than uh last time I remember. So thanks as always for having me. >> Of course. Of course. We've got lots to get into today and I thought since we're at the the conference, the New Orleans Investment Conference, you've been out and about on the show floor today. Maybe you can tell me any takeaways you have on on sentiment, key thoughts that you've been hearing for people. Well, I guess the main thing is that I heard from Brian London who runs the show. I think they're 25% higher than they were expected or than normal. So, I think it makes sense. You see, was not here the last couple of years, but he was saying as opposed to the recent years, there's more people, which obviously I think the gold and silver longtimers are a bit happier these days than they've been in recent years. And also I'll I'll follow up on that, but I would imagine there's we have seen as you and I have talked about before generalist and mainstream money coming in. Started picking up earlier this year, especially in the past couple months when we had silver over 50, gold up to almost $4,400. So there could be a little bit of that here. Um I think it's also going to be interesting. We're at this point where if we have a resumption of the rally, I think we could think there was a lot of money sitting on the fence and people who traditionally don't think at all about gold and silver now wavering. If we see a big selloff from here, maybe that changes that. But I think it's also possible we could see an even bigger wave come in if you do get a resumption in prices. And I'm sure there's a lot of people here trying to figure that out and imagine what's coming next. So >> yeah, there's definitely a lot of people here. I I think it's it's mixed is what I'm getting so far. There's people who are definitely optimistic and they see this pullback as a buying opportunity. And there are also people who are a little bit worried and wondering, all right, well, they moved so far. Are we going on the way back down? And it kind of goes back to what we've been talking about in in our previous interview. when are people going to feel happy and good about the silver price? So any any thoughts further thoughts you would add on the direction of of silver? >> Yes, I would love to. Thank you for asking. Uh first of all, if people are happy or not. >> Yeah, >> I mean I get it. Everyone has their own different expectations. Although to the degree that there people have been waiting from 1980 to this year for silver to break 50. It went up to I think the spot price even broke 54 or got close to it. So, I mean, it's at an all-time record high. I hope people who have been investing in this for a while or at least smiling or even aside from that, taking a step back, whether it's reach the price you want or not, I think it it's important to take a step back and think about for most people, this has been a pretty long journey. You've gotten your teeth kicked in for years at a time, and if nothing else, just appreciating all these things that have happened. And I think one of the things that's challenging for people is they invest in gold and silver, they see the inflation, they see the wild stuff that's going on. And for years, they didn't really see that reflected in the price. And I think that's something that's been helpful where, you know, there's this tendency when you wait so long and did I miss something or was I wrong and it turns out no, this is the time it took. In fact, I know you often on your channel and I talk about it too. silver. Who who knew it was going to be October of 2025? That's when it turned out to be. It could have been the year before, the year after, but here it is. Um, now in terms of the selloff, I know uh the silver price is down another dollar today, so it's possible this has changed, but at least prior to that, Charlotte, you're aware this isn't even the biggest silver sell-off we've had this year because after the reciprocal tariffs on April 2nd, silver futures I think were over they were over $35 when the announcement came out and they ended up below 28.50. I forget the exact price, but >> we did have this happen. We've had bigger selloffs in silver. We had one happen this year and most people don't even remember it because that was taking us from uh I think it was 35 down under the $30 level and obviously we're well past that. Okay. So, where does that leave us now? Does that guarantee that we're going to have the exact same thing happen? Of course not. Yet also it does suggest though that We could have that happen. And I know I might upset some people as I say this, but when you see the both gold and silver go up as fast as quickly, and to the extent and magnitude that they did in such a short period of time, >> you don't have to, but I would suggest it's wise to expect that you would have something like this eventually. Now, with that said, does that mean that the rally is over? Um, >> I'll put it like this. I've, and maybe you might agree, I've been interviewing everyone outside of Santa Claus on the silver market for the last six years. I have yet to find someone who can accurately say, "Well, this is where it's going to be next month." But when you look at the fundamental things that have driven the gold and silver price on the silver side, we still haven't had a resolution to this supply gap in London. Now the market did normalize which means the spot price was back under the futures. It normalized for a day after that blew out early October. Now it's back in backwardation. We've seen about 40 million ounces leave the comx. I would ballpark about 5 million ounces left China. Although if you have a free float that's down to about 140 million ounces and the LBM's daily turnover is around 250 million ounces. It's 40 million ounces going to bridge that gap. We've had India stopped additions to their silver ETFs back actually that same day, October 9th, when the silver market ran into that crisis. Uh was Bloomberg a couple weeks later had a quote from JP Morgan. What was initially India, their reports were, well, we can't add shares to the silver ETFs because we're out, but we're expecting more in the next shipment. It was either October 8th or 9th. We're saying a week or two later. Week or two later, we see Bloomberg report that JP Morgan was telling clients India they have no silver for India for the rest of October into November. And what are we is November 4th. I checked uh before we started. I've not seen any indication that the silver has returned. I also think about how remember what it was like after COVID and like people are you know beating the heck out of each other on that Costco like to get more rolls of toilet paper. So thinking about that human dynamic we had India had a surge in I believe it was September of gold and silver imports and again as I know you've heard India traditionally price sensitive so they're not as much the buy high sell low. So, here's a group that at a time when they typically didn't don't buy, had a surge, and then you said, "Well, we ran out. You can't have anymore." In the middle of festival season, I don't know, maybe if festival seasons pass, demand comes down. But I also wondered, will there be some pent up demand once silver returns? And still, we're in the middle of a deficit. So everything that I've seen so far, I can't I can't point to something that's like, okay, this is a long-term resolution of this. This looks like it bought some more time. Um, and perhaps just the last thing I'll add there, there's Robert Gotautle, the former JP Morgan man, precious metals managing director. He was on KitKo a week or two ago saying we need 100 to 150 million ounces. We haven't gotten anywhere close. that spread has narrowed and we've seen the withdrawals slow down out of the comx. So >> I would say that c could the metals prices go lower? Of course they can. But is what we've seen in these past couple weeks given the context it occurred within is that an indication that this rally is definitely over? I would suggest not and um certain we can dig into the gold side as well. But you have similar dynamics where the reasons that drove the prices to where they were are still there. And you know, if you think, well, are we going to be higher or lower five or 10 years from now? I think if you can take that step back, it and I get people want to know what happens sooner than that. But at least if you can think 10 years from now, do I see gold being at $3,000? Do I see it being possible that gold's at $3,000 given what's happening? I think if you can step back and think about that question, that can really help in terms of the decisions that you're making. >> Yeah. Yeah. I think that helps to show how you see the silver market right now. It makes a lot of sense to me. And I wonder if you can go a little bit more into the issues we're seeing with silver supply. You're mentioning I think this is around the last time where we're talking we're having the the problem with supply in London and you mentioned it's it's normalized at this point, but it's not fixed. And you also were talking just now about India not having the silver that they want there. What what do we need to see there to have these things resolved? We need silver to be moving. Can you maybe just elaborate a bit more on those? >> Sure. Um I mean it's a fascinating situation. And I mean obviously there's the money and the trading part that everyone has, you know, their different impact with, but it in terms of a market event and for the things that you do where you've been studying this for however many years and then to see it happen in such wild fashion and perhaps I can help uh explain that because one thing is you've I've seen places where they say silver shortage. Now, I always try to be careful with that word because especially, you know, if you're in media and talking about it and knowing that there's the belief, which I think is reasonable, that we could have a gap at some point, which kind of getting like the initial warning flares of now. So, I don't think we have Well, I'll say that. I was thinking we don't have a global serless shortage because right now when I hear people say the COMX is about to break that is that possible? Sure. Although all that metal has gone over to the COMX. So if there's ever been a time where the COMX isn't in position to have a problem they have about 500 million ounces of silver which is 200 million ounces than more than earlier this year. Now on the other hand in London they have a silver short or they had I guess it's eased slightly with some of the metal going back there but they were experiencing a silver shortage. What was also interesting about that Bloomberg article I mentioned, they said, according to someone familiar with the LBMA's thinking, they were saying this wasn't a geographic dislocation, but a genuine silver shortage, which that was also after the Royal Mint was talking about delays. You know how when people always say about, you know, if we run out of silver and seems like everybody always uses Samsung and Apple as the example of an electronics manufacturer. Well, the Royal is not an electronics manufacturer, but do you want to call that industrial? I mean, they use silver to make their product and they're talking about delays. And shortly after that happened, the LBMA is saying, at least according to Bloomberg, they don't think this is just the silver's here and not there. And over in India, India I think is pretty clear and straightforward. They have a silver shortage. They cannot buy it right now. So, do we have an overall silver shortage? I was thinking not. Um, but I found that LBMA quote in Bloomberg article quite intriguing. Um and what happened is that because you have the silver in comx but you have a shortage in London that's why the market went into what's called backwardation where normally the futures trades at a higher price than the spot price but because there was you saw the price in London getting bid over which is called backwardation which doesn't normally happen but here's the the this was the stunning part back on that October 9th date I mentioned remember waking up that morning to post our morning show and so I wow it's up to a buck 20 I mean >> again normally futures 20 or 37 20 or 30 cents over spot depending on how close you are to expiration so when it goes negative let's say it goes to negative 20 cents that's really 40 cents out of line because you're going from over 20 to under 20 so I think on that Tuesday the 7th it was about 20 cents by Wednesday was at 50 cents. This is already somewhat extreme territory. By that Thursday morning, it was at a$120. And then about two or two and a half hours later, it was up to 250. So that when I mentioned before the day the silver market broke, that was really the epitome of that. And when the price was over, that's when silver started leaving the ComX. LBMA only publishes their data monthly, so we don't know how much has been restocked. Presumably, that silver is going to the LBMA or it could be going directly to India. Takes a little while to get there. And we're kind of in limbo now, waiting to see what the net effect of that is. So, what could resolve it? Well, I guess if all the, you know, if enough silver leaves the COMX, that could resolve it. Although, again, we're still in the midst of the deficit. And I guess you could say now the conditions have changed in the mining equities market. But, you know, if it's going to take a couple years or decades for that silver to come to production, I I still think we're in the same net position that there's a mismatch and we're seeing this unravel and the fact that market exited backwardation and was was normalized where futures over the spot about a week ago and then it went back into backwardation. So, clearly an indication this isn't solved. I don't know that there's really I I don't see a long-term resolution out there. It's like it's like when you have someone checkmate on the board, you can, you know, like, oh, maybe the answer's under the table over there. You can keep But it reminds me almost like the the US balance sheet situation. You can sit here and say like, well, maybe we can get them to look over there and we'll slide this under the table, but it it's bankrupt. You're going to have to do something. I think the possibility that eventually there's some sort of gold revaluation is growing. And if I may distinguish, just to be clear, we have what's already been introduced in legislation through that strategic Bitcoin act. There's policy about that, not enacted yet, but in its legal stages where you can read that document and see they talk about revaluing the Fed certificates. The other more extreme case is if at some point we have a Sunday night where it's like, hey, we're raising the gold price to 15 or 20,000, which would allow them to knock off more debt. Even that is a short-term solution because let's say they raise the price to 30 grand, mark the re remark the Fed certificates, pay off a chunk of debt. But if this situation doesn't change, like that's what hit me the other day where 50 or 75 years from now, unless you have the government stop spending, you're still in that wheel. Which is why at the end of the day, hey, if you paid 4,200 for gold and it's below 4,000 now, when you start thinking through some of these things, let alone the whole dynamics with China, the move to onshore and how all this gets funded, what happens to the bond holders, that leaves me feeling that as the years go by, um, even and I get it because I we talked about it last time, well, do you go out and buy gold now at 4,000 as opposed to when it's just had a historic move. And if I were trading in and out of it, probably not. Although, if I'm thinking, well, if I want to leave something there for the longer term and I take that step back, then that again, I think helps make the decision easier for people. >> Well, and I think on the note of how does this have further to go, etc. You you wrote recently about how some of the big banks are are going on a bit of a hiring spree because they want to hire gold and silver traders. They want to maybe also offer vaulting services. So maybe you can speak about that because I think that adds to the the case in some way. >> Yeah. Well, first of all, I know I could be partly guilty for this. There's a tendency when people hear the Goldman said this, JP Morgan said that to think that oh well, they have some insight. they know what's going on with the price. I don't think that's generally the case. I mean, obviously, we know the spoofing has occurred and there's stuff that's inappropriate that goes on yet. I think there's a belief that the guy at JP Morgan or Goldman knows what's going to happen. I think we're in a situation right now where it's like who's going to who was going to win the game seven of the World Series. Well, until it was played, you could have a good guess, but nobody knew for sure. this is an ongoing situation here that um is unresolved. So, I don't think they necessarily know, but that's an indication at at the very least they're getting a lot more business. B from my experience on Wall Street, they tend to overhire when a market is hot and over fire when the market is cold. So to some degree on the banking level, there's enough that they're seeing in terms of the increased business and what they expect going forward that they're adding to staff here. And um like you mentioned, there was another one where uh some of the other banks want to cut in on some of the services JP Morgan offers. So some indication on the banking thinking which I don't remember that happening before cuz back in 2011 I remember giggling at some of these bank reports where you know they had uh you know gold was up at 1900 and you'd see like their long-term forecast was 1,200. I guess they turned out to be right on those. Um but I mean this would be an indication that their thinking is a bit different than what we've seen before. Can you maybe just elaborate a bit more on the Trump administration's plans for gold? And I wondered if you could go into that and share your thoughts there, what you're seeing. >> Well, sure. Um, I mean, it's been a fascinating year. We've had everyone in the Trump administration, it seems like, talk about the overvalued dollar. There's Steven Meerin who wrote a 41page paper called Restructuring the Global Financial Trading System in November of 2024. They didn't put a date on it whether it was before or after Trump was elected. Although talked to Adn Nazium about the overvalued dollar. At one point he said the root of all economic imbalance is tied to the overvalued dollar. Trump wins the election and month later in December he nominates this guy for chairman of the economic councils of adviserss. Now, I think he now has a position in the Fed where he's voted for two rate cuts at each of the last two meetings. I've heard good arguments presented that is it a coincidence that the dollar index dropped from 110 to under 100 in the time since Trump's team came into office? Have they been influencing loosely or >> directly the price? can't give you an exact answer. I think there's reason to believe that could be the case. And here's another thing that is interesting to think about. We talked about the two types of gold resets. We'll leave aside the more extreme one where say, "Hey, we're taking it this price." I think that could happen, I think, over a long enough time frame that it's like, how what else are they going to do? But we'll stick to the first case where if you're going to say, "All right, we're going to reset, we're going to repric the Fed gold certificates from the 4222 to the market price." Well, here's the interesting thing. As the price is going up now that means the higher the price goes when they remark to market price what happens is that that gets remarked by the treasury or by the Federal Reserve and the difference in the price goes into the Treasury account. So the higher the gold price goes now the more money the Trump administration would get by enacting that move. And I heard um I think people know I'm a big Luke Groman fan and he had some interesting comments um that I agree with where I think for a long time it was viewed to the US and government forces well hey if we see gold and silver screaming that's a reflection that people are losing faith in our currency. I tend to agree with Luke that I I think we're at the point where even the Washington establishment realizes like okay we we have a problem now this what we've been doing the last 50 years and you even heard Scott Besson I haven't seen him say it but I saw the quote where he said the rise in gold price has been good for the US and I would say what we what I just mentioned is one of the big reasons why. So, seems like a different shift there in terms of what they want, what the incentives are. And >> I've tried listening to East Jers. I >> think we're seeing that play out right now. Some of it you got to read the tea leaves. So, it's it's not a matter of someone's writing it down in policy, but if you look part of it, they've told you they've said the dollar is too high. They've said they want to bring manufacturing back. And you you can do that. you're going to need a lower dollar to balance these things out. So, it's one of the rare cases where this time they're telling you what's going to happen and it's happening and these are some of the reasons why I think they're okay with it happening. And when you look at it like from like from that perspective, it again helps answer that. I don't know what's going to happen next week. But in terms of the longer term, I think as you see these things unfold, it helps your degree of confidence of okay, five years from now, how sure am I? Well, might have been this sure, but after things I've seen this year, that has gone significantly higher. And the same with the the silver gap. like maybe there's a way it gets resolved, but it's becoming increasingly harder to figure out what else that could be except the pricing levels, >> right? So, so the focus is on the long term for both silver and gold. I think it makes a lot of sense right now. And I know I I have to Oh, >> if I may, the focus may not be on the long term. I think it's a good place to put the focus is not always there, unfortunately. But sorry for interrupting. >> I see what you mean. No, I was going to say I know I need to get you back out. You've got your your live stream to do, but any quick final thoughts before I let you go? >> Um, yeah, just keep watching Charlotte's channel and you'll know everything you need to know. Um, and perhaps I would suggest that for the people watching, which I know for most of the people is a long time, you know, yes, continue. I hope this was helpful and continue listening to different views. But I would also point out that you've you've you already have a base of knowledge if you're if people are watching your channel or coming to the New Orleans conference and draw back to that. You don't need to do anything because I say it or believe what I say, but you have this information now. You've been given a confirmation that your thesis was correct. And I I would just tell people to trust that and and value what you've picked up through this process and use that going forward and you know you learn as much as you can but if you have your own solid understanding of what's happening that usually a pretty good formula. >> Okay. Well, very good words to end on. Thank you so much for coming on. Good to see you in person. Thank you again. >> Likewise. Thanks so much, Charlotte. Great to see you. >> Of course. And once again, I'm Charlotte McCloud with investingnews.com and this is Chris Barkus.
Chris Marcus: Silver Supply Crunch Not Over, Price Path Clear Long Term
Summary
Transcript
I'm Charlotte Mloud with investingnews.com and here today with me is Chris Marcus, founder of Arcadia Economics. Thank you so much for being here the first time in person. >> Charlotte, I'm honored to be here. It's just wonderful to see you as always and um certainly as usual interesting times in Gold and Silverland and nice to be here in New Orleans where people seem happier this year than uh last time I remember. So thanks as always for having me. >> Of course. Of course. We've got lots to get into today and I thought since we're at the the conference, the New Orleans Investment Conference, you've been out and about on the show floor today. Maybe you can tell me any takeaways you have on on sentiment, key thoughts that you've been hearing for people. Well, I guess the main thing is that I heard from Brian London who runs the show. I think they're 25% higher than they were expected or than normal. So, I think it makes sense. You see, was not here the last couple of years, but he was saying as opposed to the recent years, there's more people, which obviously I think the gold and silver longtimers are a bit happier these days than they've been in recent years. And also I'll I'll follow up on that, but I would imagine there's we have seen as you and I have talked about before generalist and mainstream money coming in. Started picking up earlier this year, especially in the past couple months when we had silver over 50, gold up to almost $4,400. So there could be a little bit of that here. Um I think it's also going to be interesting. We're at this point where if we have a resumption of the rally, I think we could think there was a lot of money sitting on the fence and people who traditionally don't think at all about gold and silver now wavering. If we see a big selloff from here, maybe that changes that. But I think it's also possible we could see an even bigger wave come in if you do get a resumption in prices. And I'm sure there's a lot of people here trying to figure that out and imagine what's coming next. So >> yeah, there's definitely a lot of people here. I I think it's it's mixed is what I'm getting so far. There's people who are definitely optimistic and they see this pullback as a buying opportunity. And there are also people who are a little bit worried and wondering, all right, well, they moved so far. Are we going on the way back down? And it kind of goes back to what we've been talking about in in our previous interview. when are people going to feel happy and good about the silver price? So any any thoughts further thoughts you would add on the direction of of silver? >> Yes, I would love to. Thank you for asking. Uh first of all, if people are happy or not. >> Yeah, >> I mean I get it. Everyone has their own different expectations. Although to the degree that there people have been waiting from 1980 to this year for silver to break 50. It went up to I think the spot price even broke 54 or got close to it. So, I mean, it's at an all-time record high. I hope people who have been investing in this for a while or at least smiling or even aside from that, taking a step back, whether it's reach the price you want or not, I think it it's important to take a step back and think about for most people, this has been a pretty long journey. You've gotten your teeth kicked in for years at a time, and if nothing else, just appreciating all these things that have happened. And I think one of the things that's challenging for people is they invest in gold and silver, they see the inflation, they see the wild stuff that's going on. And for years, they didn't really see that reflected in the price. And I think that's something that's been helpful where, you know, there's this tendency when you wait so long and did I miss something or was I wrong and it turns out no, this is the time it took. In fact, I know you often on your channel and I talk about it too. silver. Who who knew it was going to be October of 2025? That's when it turned out to be. It could have been the year before, the year after, but here it is. Um, now in terms of the selloff, I know uh the silver price is down another dollar today, so it's possible this has changed, but at least prior to that, Charlotte, you're aware this isn't even the biggest silver sell-off we've had this year because after the reciprocal tariffs on April 2nd, silver futures I think were over they were over $35 when the announcement came out and they ended up below 28.50. I forget the exact price, but >> we did have this happen. We've had bigger selloffs in silver. We had one happen this year and most people don't even remember it because that was taking us from uh I think it was 35 down under the $30 level and obviously we're well past that. Okay. So, where does that leave us now? Does that guarantee that we're going to have the exact same thing happen? Of course not. Yet also it does suggest though that We could have that happen. And I know I might upset some people as I say this, but when you see the both gold and silver go up as fast as quickly, and to the extent and magnitude that they did in such a short period of time, >> you don't have to, but I would suggest it's wise to expect that you would have something like this eventually. Now, with that said, does that mean that the rally is over? Um, >> I'll put it like this. I've, and maybe you might agree, I've been interviewing everyone outside of Santa Claus on the silver market for the last six years. I have yet to find someone who can accurately say, "Well, this is where it's going to be next month." But when you look at the fundamental things that have driven the gold and silver price on the silver side, we still haven't had a resolution to this supply gap in London. Now the market did normalize which means the spot price was back under the futures. It normalized for a day after that blew out early October. Now it's back in backwardation. We've seen about 40 million ounces leave the comx. I would ballpark about 5 million ounces left China. Although if you have a free float that's down to about 140 million ounces and the LBM's daily turnover is around 250 million ounces. It's 40 million ounces going to bridge that gap. We've had India stopped additions to their silver ETFs back actually that same day, October 9th, when the silver market ran into that crisis. Uh was Bloomberg a couple weeks later had a quote from JP Morgan. What was initially India, their reports were, well, we can't add shares to the silver ETFs because we're out, but we're expecting more in the next shipment. It was either October 8th or 9th. We're saying a week or two later. Week or two later, we see Bloomberg report that JP Morgan was telling clients India they have no silver for India for the rest of October into November. And what are we is November 4th. I checked uh before we started. I've not seen any indication that the silver has returned. I also think about how remember what it was like after COVID and like people are you know beating the heck out of each other on that Costco like to get more rolls of toilet paper. So thinking about that human dynamic we had India had a surge in I believe it was September of gold and silver imports and again as I know you've heard India traditionally price sensitive so they're not as much the buy high sell low. So, here's a group that at a time when they typically didn't don't buy, had a surge, and then you said, "Well, we ran out. You can't have anymore." In the middle of festival season, I don't know, maybe if festival seasons pass, demand comes down. But I also wondered, will there be some pent up demand once silver returns? And still, we're in the middle of a deficit. So everything that I've seen so far, I can't I can't point to something that's like, okay, this is a long-term resolution of this. This looks like it bought some more time. Um, and perhaps just the last thing I'll add there, there's Robert Gotautle, the former JP Morgan man, precious metals managing director. He was on KitKo a week or two ago saying we need 100 to 150 million ounces. We haven't gotten anywhere close. that spread has narrowed and we've seen the withdrawals slow down out of the comx. So >> I would say that c could the metals prices go lower? Of course they can. But is what we've seen in these past couple weeks given the context it occurred within is that an indication that this rally is definitely over? I would suggest not and um certain we can dig into the gold side as well. But you have similar dynamics where the reasons that drove the prices to where they were are still there. And you know, if you think, well, are we going to be higher or lower five or 10 years from now? I think if you can take that step back, it and I get people want to know what happens sooner than that. But at least if you can think 10 years from now, do I see gold being at $3,000? Do I see it being possible that gold's at $3,000 given what's happening? I think if you can step back and think about that question, that can really help in terms of the decisions that you're making. >> Yeah. Yeah. I think that helps to show how you see the silver market right now. It makes a lot of sense to me. And I wonder if you can go a little bit more into the issues we're seeing with silver supply. You're mentioning I think this is around the last time where we're talking we're having the the problem with supply in London and you mentioned it's it's normalized at this point, but it's not fixed. And you also were talking just now about India not having the silver that they want there. What what do we need to see there to have these things resolved? We need silver to be moving. Can you maybe just elaborate a bit more on those? >> Sure. Um I mean it's a fascinating situation. And I mean obviously there's the money and the trading part that everyone has, you know, their different impact with, but it in terms of a market event and for the things that you do where you've been studying this for however many years and then to see it happen in such wild fashion and perhaps I can help uh explain that because one thing is you've I've seen places where they say silver shortage. Now, I always try to be careful with that word because especially, you know, if you're in media and talking about it and knowing that there's the belief, which I think is reasonable, that we could have a gap at some point, which kind of getting like the initial warning flares of now. So, I don't think we have Well, I'll say that. I was thinking we don't have a global serless shortage because right now when I hear people say the COMX is about to break that is that possible? Sure. Although all that metal has gone over to the COMX. So if there's ever been a time where the COMX isn't in position to have a problem they have about 500 million ounces of silver which is 200 million ounces than more than earlier this year. Now on the other hand in London they have a silver short or they had I guess it's eased slightly with some of the metal going back there but they were experiencing a silver shortage. What was also interesting about that Bloomberg article I mentioned, they said, according to someone familiar with the LBMA's thinking, they were saying this wasn't a geographic dislocation, but a genuine silver shortage, which that was also after the Royal Mint was talking about delays. You know how when people always say about, you know, if we run out of silver and seems like everybody always uses Samsung and Apple as the example of an electronics manufacturer. Well, the Royal is not an electronics manufacturer, but do you want to call that industrial? I mean, they use silver to make their product and they're talking about delays. And shortly after that happened, the LBMA is saying, at least according to Bloomberg, they don't think this is just the silver's here and not there. And over in India, India I think is pretty clear and straightforward. They have a silver shortage. They cannot buy it right now. So, do we have an overall silver shortage? I was thinking not. Um, but I found that LBMA quote in Bloomberg article quite intriguing. Um and what happened is that because you have the silver in comx but you have a shortage in London that's why the market went into what's called backwardation where normally the futures trades at a higher price than the spot price but because there was you saw the price in London getting bid over which is called backwardation which doesn't normally happen but here's the the this was the stunning part back on that October 9th date I mentioned remember waking up that morning to post our morning show and so I wow it's up to a buck 20 I mean >> again normally futures 20 or 37 20 or 30 cents over spot depending on how close you are to expiration so when it goes negative let's say it goes to negative 20 cents that's really 40 cents out of line because you're going from over 20 to under 20 so I think on that Tuesday the 7th it was about 20 cents by Wednesday was at 50 cents. This is already somewhat extreme territory. By that Thursday morning, it was at a$120. And then about two or two and a half hours later, it was up to 250. So that when I mentioned before the day the silver market broke, that was really the epitome of that. And when the price was over, that's when silver started leaving the ComX. LBMA only publishes their data monthly, so we don't know how much has been restocked. Presumably, that silver is going to the LBMA or it could be going directly to India. Takes a little while to get there. And we're kind of in limbo now, waiting to see what the net effect of that is. So, what could resolve it? Well, I guess if all the, you know, if enough silver leaves the COMX, that could resolve it. Although, again, we're still in the midst of the deficit. And I guess you could say now the conditions have changed in the mining equities market. But, you know, if it's going to take a couple years or decades for that silver to come to production, I I still think we're in the same net position that there's a mismatch and we're seeing this unravel and the fact that market exited backwardation and was was normalized where futures over the spot about a week ago and then it went back into backwardation. So, clearly an indication this isn't solved. I don't know that there's really I I don't see a long-term resolution out there. It's like it's like when you have someone checkmate on the board, you can, you know, like, oh, maybe the answer's under the table over there. You can keep But it reminds me almost like the the US balance sheet situation. You can sit here and say like, well, maybe we can get them to look over there and we'll slide this under the table, but it it's bankrupt. You're going to have to do something. I think the possibility that eventually there's some sort of gold revaluation is growing. And if I may distinguish, just to be clear, we have what's already been introduced in legislation through that strategic Bitcoin act. There's policy about that, not enacted yet, but in its legal stages where you can read that document and see they talk about revaluing the Fed certificates. The other more extreme case is if at some point we have a Sunday night where it's like, hey, we're raising the gold price to 15 or 20,000, which would allow them to knock off more debt. Even that is a short-term solution because let's say they raise the price to 30 grand, mark the re remark the Fed certificates, pay off a chunk of debt. But if this situation doesn't change, like that's what hit me the other day where 50 or 75 years from now, unless you have the government stop spending, you're still in that wheel. Which is why at the end of the day, hey, if you paid 4,200 for gold and it's below 4,000 now, when you start thinking through some of these things, let alone the whole dynamics with China, the move to onshore and how all this gets funded, what happens to the bond holders, that leaves me feeling that as the years go by, um, even and I get it because I we talked about it last time, well, do you go out and buy gold now at 4,000 as opposed to when it's just had a historic move. And if I were trading in and out of it, probably not. Although, if I'm thinking, well, if I want to leave something there for the longer term and I take that step back, then that again, I think helps make the decision easier for people. >> Well, and I think on the note of how does this have further to go, etc. You you wrote recently about how some of the big banks are are going on a bit of a hiring spree because they want to hire gold and silver traders. They want to maybe also offer vaulting services. So maybe you can speak about that because I think that adds to the the case in some way. >> Yeah. Well, first of all, I know I could be partly guilty for this. There's a tendency when people hear the Goldman said this, JP Morgan said that to think that oh well, they have some insight. they know what's going on with the price. I don't think that's generally the case. I mean, obviously, we know the spoofing has occurred and there's stuff that's inappropriate that goes on yet. I think there's a belief that the guy at JP Morgan or Goldman knows what's going to happen. I think we're in a situation right now where it's like who's going to who was going to win the game seven of the World Series. Well, until it was played, you could have a good guess, but nobody knew for sure. this is an ongoing situation here that um is unresolved. So, I don't think they necessarily know, but that's an indication at at the very least they're getting a lot more business. B from my experience on Wall Street, they tend to overhire when a market is hot and over fire when the market is cold. So to some degree on the banking level, there's enough that they're seeing in terms of the increased business and what they expect going forward that they're adding to staff here. And um like you mentioned, there was another one where uh some of the other banks want to cut in on some of the services JP Morgan offers. So some indication on the banking thinking which I don't remember that happening before cuz back in 2011 I remember giggling at some of these bank reports where you know they had uh you know gold was up at 1900 and you'd see like their long-term forecast was 1,200. I guess they turned out to be right on those. Um but I mean this would be an indication that their thinking is a bit different than what we've seen before. Can you maybe just elaborate a bit more on the Trump administration's plans for gold? And I wondered if you could go into that and share your thoughts there, what you're seeing. >> Well, sure. Um, I mean, it's been a fascinating year. We've had everyone in the Trump administration, it seems like, talk about the overvalued dollar. There's Steven Meerin who wrote a 41page paper called Restructuring the Global Financial Trading System in November of 2024. They didn't put a date on it whether it was before or after Trump was elected. Although talked to Adn Nazium about the overvalued dollar. At one point he said the root of all economic imbalance is tied to the overvalued dollar. Trump wins the election and month later in December he nominates this guy for chairman of the economic councils of adviserss. Now, I think he now has a position in the Fed where he's voted for two rate cuts at each of the last two meetings. I've heard good arguments presented that is it a coincidence that the dollar index dropped from 110 to under 100 in the time since Trump's team came into office? Have they been influencing loosely or >> directly the price? can't give you an exact answer. I think there's reason to believe that could be the case. And here's another thing that is interesting to think about. We talked about the two types of gold resets. We'll leave aside the more extreme one where say, "Hey, we're taking it this price." I think that could happen, I think, over a long enough time frame that it's like, how what else are they going to do? But we'll stick to the first case where if you're going to say, "All right, we're going to reset, we're going to repric the Fed gold certificates from the 4222 to the market price." Well, here's the interesting thing. As the price is going up now that means the higher the price goes when they remark to market price what happens is that that gets remarked by the treasury or by the Federal Reserve and the difference in the price goes into the Treasury account. So the higher the gold price goes now the more money the Trump administration would get by enacting that move. And I heard um I think people know I'm a big Luke Groman fan and he had some interesting comments um that I agree with where I think for a long time it was viewed to the US and government forces well hey if we see gold and silver screaming that's a reflection that people are losing faith in our currency. I tend to agree with Luke that I I think we're at the point where even the Washington establishment realizes like okay we we have a problem now this what we've been doing the last 50 years and you even heard Scott Besson I haven't seen him say it but I saw the quote where he said the rise in gold price has been good for the US and I would say what we what I just mentioned is one of the big reasons why. So, seems like a different shift there in terms of what they want, what the incentives are. And >> I've tried listening to East Jers. I >> think we're seeing that play out right now. Some of it you got to read the tea leaves. So, it's it's not a matter of someone's writing it down in policy, but if you look part of it, they've told you they've said the dollar is too high. They've said they want to bring manufacturing back. And you you can do that. you're going to need a lower dollar to balance these things out. So, it's one of the rare cases where this time they're telling you what's going to happen and it's happening and these are some of the reasons why I think they're okay with it happening. And when you look at it like from like from that perspective, it again helps answer that. I don't know what's going to happen next week. But in terms of the longer term, I think as you see these things unfold, it helps your degree of confidence of okay, five years from now, how sure am I? Well, might have been this sure, but after things I've seen this year, that has gone significantly higher. And the same with the the silver gap. like maybe there's a way it gets resolved, but it's becoming increasingly harder to figure out what else that could be except the pricing levels, >> right? So, so the focus is on the long term for both silver and gold. I think it makes a lot of sense right now. And I know I I have to Oh, >> if I may, the focus may not be on the long term. I think it's a good place to put the focus is not always there, unfortunately. But sorry for interrupting. >> I see what you mean. No, I was going to say I know I need to get you back out. You've got your your live stream to do, but any quick final thoughts before I let you go? >> Um, yeah, just keep watching Charlotte's channel and you'll know everything you need to know. Um, and perhaps I would suggest that for the people watching, which I know for most of the people is a long time, you know, yes, continue. I hope this was helpful and continue listening to different views. But I would also point out that you've you've you already have a base of knowledge if you're if people are watching your channel or coming to the New Orleans conference and draw back to that. You don't need to do anything because I say it or believe what I say, but you have this information now. You've been given a confirmation that your thesis was correct. And I I would just tell people to trust that and and value what you've picked up through this process and use that going forward and you know you learn as much as you can but if you have your own solid understanding of what's happening that usually a pretty good formula. >> Okay. Well, very good words to end on. Thank you so much for coming on. Good to see you in person. Thank you again. >> Likewise. Thanks so much, Charlotte. Great to see you. >> Of course. And once again, I'm Charlotte McCloud with investingnews.com and this is Chris Barkus.