The most blatant act of financial warfare we've seen in a long time is underway. As you read this, the price of silver in New York is crashing to ~$72, an artificially created crash in small-volume paper securities designed to steal your position.
Meanwhile, on the other side of the world, the physical market in Shanghai is screaming, with silver trading at a staggering $83.
This is not a spread /n.d. financial term denoting the difference between the buy and sell price of an instrument/ - that's a divorce!
The paper securities market in the West and the physical market in the East are torn apart, and the ~$11 difference between them is the fuse that is about to ignite the strongest price explosion in modern history.
In the world of global finance, a 15% spread on a fungible commodity is impossible. It's like seeing gold trading at $2,000 in London and $2,400 in New York. Such a possibility shouldn't exist.
What we are witnessing is a trap, a last, desperate move by the Western banking cartel to steal our silver just days before the world changes forever. Don't fall for this!
I know what's in your stomach, I feel it. I know the panic that's creeping into the back of your mind. Just 48 hours ago, we were celebrating an all-time high of nearly $80. We were talking triple digits. And now, on a quiet Monday morning, the market has crashed.
The charts look broken. The momentum looks dead. The mainstream financial media is telling us that the bubble has burst. I'm here to tell you to stop, take a breath, and listen very carefully. Nothing has changed in the real world.
The supply crunch hasn't subsided. The Chinese export ban hasn't been lifted. What we are witnessing is a mathematically calculated high-frequency trading trap designed for one purpose: to steal our silver three days before the new world begins.
You have to see this trap for what it is.
You have to see the hard data, the real-time prices from Shanghai that prove the $72 COMEX price is a lie.
You have to understand why the $11 arbitrage is not closing and why it is the most important sign of a broken market.
You have to understand the psychology of the paper crash, how banks use your own stop-loss orders against you to build up a final position before the January 1 export ban changes the game forever.
This is not a disaster. This is a gift. It's a time machine that has taken you back a week, offering you one last chance to get on board before the train leaves the station forever. The West is asleep. The East is awake. And the difference between them is the final warning.
Let's dig deeper into this:
The banks can see your stop-loss orders. They have a map of your pain threshold.
Once they reach it, your computer automatically sells. You panic. You put your silver back into the market. And who is on the other side of this deal, eagerly buying up every ounce you just panicked and sold at a discount?
The same entities that orchestrated the crash. They're shaking the tree to see what happens. They clear the deck of weak hands, tourists, and gamblers who don't understand the basics, so that when the real action starts in January, the train is lighter.
In this low-volume holiday environment, where it costs them almost nothing to change the price, they simply push it down until they hit the first cluster of stops. Why? Because they don't want you to ride with them to $100. They want your spot!
The arbitrageurs, the market sharks, should be enjoying this disparity between the West and the East. They should be buying every ounce of silver in New York for ~$72, putting it on a plane, and selling it in Shanghai for $83, making a risk-free profit of $11 per ounce.
They would close this gap in an hour. So why isn't it happening? I'll tell you!
And why the $11 spread between Shanghai and New York is the irrefutable proof, the indisputable proof that the paper market has lost control of the physical asset and why this ends up with the paper market collapsing into the physical market!
This is a classic bear trap. It happens at the bottom of every correction and right before every big breakout.
It's designed to make you feel stupid, to make you question your whole thesis.
You look at the screen and think, “Maybe I was wrong. Maybe there's no shortage. Maybe Elon Musk was lying. Maybe I should just take my loss and go home.“
The moment you have these thoughts, they have won. You need to step back. Look at the yearly chart. We are up over 160% this year. A 5% pullback after a parabolic trend is not just normal; it is healthy. It is necessary.
Nothing goes up in a straight line. The market needs to catch its breath to test the bulls’ conviction. And the timing of that test is no coincidence. Today is December 29th. We are exactly three days away from the biggest structural change in the silver market of our lifetimes.
Do you really think the smart money is selling three days before that event? No. They are using this artificial decline to accumulate more.
Why would anyone who knows about the structural deficit and the impending Chinese export ban choose to crash the price today?
The answer is pure, predatory psychology - they are playing poker with your emotions.
They know that retail investors are in debt.
They know that many have been chasing the price at $78 or $79.
They know that you have bought call options that expire this week.
They know that you are sitting on the sidelines.
And they know that if they can get the price down to around $72, they can trigger a cascade of automated selling.
Why is the spread wide open like a gaping wound? Because arbitrage is dead. The mechanism that keeps the global price unified is broken. And what interrupted it? China's export licenses on January 1st.
For arbitrage to work, money and metal must flow freely in both directions. But China has effectively turned its silver market into a Hotel California. You can register the metal, but you can't verify it.
Once a silver bar crosses the border into Shanghai, it is subject to the new export restrictions. It is locked up behind the Red Wall.
If a Western bank sends a million ounces to Shanghai to achieve that $83 price, they get paid in yuan. But then they have a problem. They have a pile of yuan in China that they can't easily convert back into dollars and take out because of capital controls.
And they certainly can't get the silver back if the trade goes wrong. The risk premium has increased dramatically. The banks look at that $11 spread and say that's not enough. They're terrified that their capital is trapped in the East just as the trade war is heating up.
This paralysis of the arbitrage offices has allowed prices to disperse. The West has become an island, a paper market dominated by derivatives and false volatility, at $72 because there is no physical pressure to deliver today.
The East has become the mainland, a physical market dominated by industrial users and strategic orders, at $83 because they actually need the metal.
Which price do you think is the real price? Do you believe the paper contract that settles in cash or the physical bar that goes into a factory? China is telling us the real price of silver. The real price is $83. New York is lying to us.
This is the end. The $11 spread between Shanghai and New York is the irrefutable proof, the irrefutable proof that the paper market has lost control of the physical asset. The collapse to $72 is not a sign of weakness, it is a sign of a broken system.
This is a last, desperate attempt by the Western banking cartel to shake us out of our positions before the inevitable revaluation to reality.
History tells us exactly how this ends. It ends with a collapse and a supply shortage. As the world's producers see the huge discount in the West, they will drain the vaults of the COMEX and LBMA unless the current governments put in place their own controls to stop it. This is something we should be looking for and it is quite surprising that it is not there yet.
China will take supplies from Western storage, take the cheap bullion out of the system and ship it to its factories. And when the storage facilities are emptied, when there is no more metal left to deliver, the price will not just go to $83. It will go to $100, then to $120, then up, and that will happen overnight.