The Case for Silver

Peter Boockvar on what looks to become the next It trade on the internet…

For some reason the Reddit crowd is chattering about silver. There is this belief that for years the big banks, particularly JP Morgan, have been artificially suppressing its price when all I think their positioning reflected was the other side of their customers. There is not a large short position that I’m aware of but that said, it is my favorite asset. It holds a unique position of having half its demand from investment and jewelry as a precious metal and money and the other half as an industrial metal. That industrial usage is becoming more ‘new age’ as silver is a raw material needed for solar panels, wind turbines and electric vehicles. Also, according to the Silver Institute, “Almost every computer, mobile phone, automobile and appliance contains silver.” From a price perspective, it still is almost 50% below its 2011 peak. I’m not aware of ANY asset that is that far from its high and consider what’s happened since 2011. Central banks discovered negative rates and a level of QE that our minds could never have imagined and the growth in renewables is only accelerating.

The related stocks are tiny and there are only a handful of silver pure-plays. Historically these have been very low quality companies subject to massive commodity boom / bust cycles. Their share prices are as wild as the futures prices are for the underlying metal. Not for the faint of heart. I won’t list them here, but I hope if you’re short these things you’re being careful. Who knows what the crowd is capable of these days?

Follow Peter Boockvar on Twitter

This content, which contains security-related opinions and/or information, is provided for informational purposes only and should not be relied upon in any manner as professional advice, or an endorsement of any practices, products or services. There can be no guarantees or assurances that the views expressed here will be applicable for any particular facts or circumstances, and should not be relied upon in any manner. You should consult your own advisers as to legal, business, tax, and other related matters concerning any investment.

The commentary in this “post” (including any related blog, podcasts, videos, and social media) reflects the personal opinions, viewpoints, and analyses of the Ritholtz Wealth Management employees providing such comments, and should not be regarded the views of Ritholtz Wealth Management LLC. or its respective affiliates or as a description of advisory services provided by Ritholtz Wealth Management or performance returns of any Ritholtz Wealth Management Investments client.

References to any securities or digital assets, or performance data, are for illustrative purposes only and do not constitute an investment recommendation or offer to provide investment advisory services. Charts and graphs provided within are for informational purposes solely and should not be relied upon when making any investment decision. Past performance is not indicative of future results. The content speaks only as of the date indicated. Any projections, estimates, forecasts, targets, prospects, and/or opinions expressed in these materials are subject to change without notice and may differ or be contrary to opinions expressed by others.

Wealthcast Media, an affiliate of Ritholtz Wealth Management, receives payment from various entities for advertisements in affiliated podcasts, blogs and emails. Inclusion of such advertisements does not constitute or imply endorsement, sponsorship or recommendation thereof, or any affiliation therewith, by the Content Creator or by Ritholtz Wealth Management or any of its employees. Investments in securities involve the risk of loss. For additional advertisement disclaimers see here:

Please see disclosures here.