Month: February 2021

Credit Bubble Bulletin/Doug Noland/1-29-2021

“Hopefully I’m wrong on this, but most will be losers. Before this is all over, many will blow up their trading accounts and exit the casino in dismay – or worse. Short squeezes always have a pyramid scheme component. It’s musical chairs, and the velocity with which squeeze stocks eventually collapse will be a shock to many. There was outrage Thursday after Robinhood and other online brokers restricted trading in a limited number of stocks. But just wait until this Bubble implodes, and there’s blood in the (Main and Wall) Streets. Trading systems were stressed this week by millions of buy orders. How will the system function under the stress of tens of millions of panicked sell orders? I’ll presume worse than March.”

USAGOLD note 1: Some words of wisdom and highly recommended reading from an old pro in the financial business. Those hoping for a short squeeze in the silver market might be careful what they wish for. It could unleash market forces against which there is little or no defense as Doug Noland outlines above and on which he elaborates in detail at the link.

USAGOLD note 2: Here at USAGOLD, we recommend gold and silver for long-term asset preservation purposes – not speculation. As such, we see physical coins and bullion as the safest and most productive option for the average investor. It is a simple, straightforward philosophy and strategy that has served us well over the years.

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Friday’s silver ETF stockpile gains are an attention grabber.

TheStreet/David Dierking/1-29-2021

“It’s still early message board chatter and there hasn’t been a commitment from the Reddit crowd yet, but silver prices are rising, volumes are increasing and there’s a strong macro argument to be made. Don’t be surprised if this group experiences a wild ride next week.”

USAGOLD note: This positive assessment was published before Friday’s numbers came out on ETF stockpile additions. GoldChartsRUs reports strong buying from silver ETFs to close out the week including a 34.4 million troy ounce stockpile gain for the IShares ETF (SLV) – the group’s most prominent member. As you can see in the chart below (which includes all repositories, mutual funds, and ETFs, including SLV), Friday’s addition is the largest by far over the past year for a single day (and by the way the largest since 2013). We’ve included a table from GCRU that shows a concentration of Friday’s volume in the IShares ETF (SLV). Above and beyond the intentions of the Reddit crowd, Dierking makes the point that silver could be headed for a big year anyway based on the fundamentals. That said, Friday’s stockpile growth is an attention grabber.

Chart and table courtesy of GoldChartsRUs • • • Click to enlarge

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