The shorts are struggling to try finding physical silver to deliver. The smart money is asking the shorts to turn the short’s paper promises into the real thing, which is a trend that I expect will continue throughout this year, not only because of inflation but also as a result of rising counterparty risk because banks are sitting on a growing stack of bad debts.
As a consequence, both gold and silver will continue much as before. The prices of both metals will trend higher as the year progresses. Importantly, the uptrend will accelerate as the group of smart money buyers accumulating the metal gets bigger as more and more people begin to understand that the debasement of the dollar is accelerating.
The second important point, Eric, is what happened after the CPI was released. Both gold and silver climbed back after the big hit they took on the release of the CPI.
After the CPI was released, the price manipulators took the metals lower to clean out the sell stops under the market looking for more physical metal. To their surprise, the backwardation didn’t disappear. It got worse. And then both precious metals completed a very bullish outside reversal day.
So the shorts are in real trouble. The central bank price manipulators who have been shorting gold and silver to keep prices under their control are contending with a toxic mix of a collapsing dollar and rising inflation. Both of these reasons mean that the precious metals are destined to continue climbing higher this year.”