What happens when the silver runs out?

Hey, it’s Garrett. 

Look, I've been around markets long enough to know when something smells fishy. 

And right now, the silver market absolutely reeks.

The numbers I'm about to share with you should scare the hell out of anyone holding paper silver positions. 

Because in less than two months, we're about to find out what happens when 751 million ounces of silver contracts try to settle against 440 million ounces of actual metal.

That's not a typo. 

The CME has allowed 1.7 times more silver contracts to trade than physical silver exists in their depositories. 

And on March 27th, those contracts expire.

Yesterday I got an email from a major coin dealer - the kind of corporate newsletter that usually puts me to sleep. 

But this one made me sit up straight: "Due to rapidly rising silver prices, Silver Numismatic products are being temporarily removed from sale while pricing is updated." Translation? They've run out of silver.

I was just at my buddy's coin shop. Line out the door. People selling whatever silver they've got in their houses. And he's not actually selling any of it - he's hoarding every ounce because he knows what's coming.

This is where it gets interesting. 

When China prints money, it goes straight into manufacturing and metals. They're not like us - we're a financialized economy, so our stimulus flows to banks. 

China's a manufacturing economy, so their stimulus flows to industrial commodities. 

They've been stimulating hard, which means industrial demand for silver is exploding right as we're discovering the futures market has been writing checks the physical market can't cash.

China banned silver exports. 

AI and EV demand is through the roof. And in eight weeks, someone's going to have to deliver 751 million ounces of silver that doesn't exist.

Here's what's going to happen: As we get closer to March 27th, delivery anxiety is going to ramp up. The CME will keep changing margin requirements, trying to shake out speculators. 

Retail money will start flowing into silver ETFs, which means those ETFs have to buy more physical metal in a market that's already tight.

When grandmothers start asking if they should melt down their silver candlesticks, you'll know we've hit peak frenzy. 

The Reddit crowd hasn't even shown up yet.

If you want to play this, forget futures-based ETFs. 

I only mess with stuff that's backed by actual metal sitting in a vault. PHYS, CEF, COPP - the Sprott trusts. 

Every share is backed by specific amounts of physical gold, silver, and copper. There's a big pile of metal up in Canada, and the price is tied directly to what's actually there.

That matters when paper silver might not be worth much if people start demanding physical delivery.

I don't know exactly how this ends, but I know how it starts: with a short squeeze that makes GameStop look like a warm-up act. 

Because unlike meme stocks, this shortage is real, the demand is industrial, and the math is simple.

751 million ounces of promises. 440 million ounces of metal. March 27th delivery.

Get positioned.

Oh, and one more thing...

I'm going live with Don Kaufman tomorrow morning at 8:45 AM.

We're gonna break down what we're seeing in the market right now... and where the big opportunities are heading into the rest of the year.

Don's a beast when it comes to options trading. Always worth showing up when he's talking.

If you can make it, do it. RSVP here.

Stay Positive,

Garrett Baldwin