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Jeff Currie, the global head of Commodities Research at Goldman Sachs
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Everything I learned about commoditie I learned from Trading Places, which is by far the most educational movie about Wall Street ever made, so I’m not qualified talk about the recent shenanigans in the silver markets. Jeff Currie is, however, because he’s the head of Commodities Research at Goldman Sachs. In a fascinating podcast that touched on a few things that I do know a little about (eg, William Jennings Bryan and the “cross of gold”) and spoke with real insight about the historic role of silver. With respect to the activity in the silver market, he expressed great scepticism about the ability of the robinhoodies to move the silver market (which is 300 times bigger than GamesStop) and explained how it would require very clever co-ordination of firepower — which I suppose is not impossible in a world of bots and message boards — to make anything happen.
He also made the point that the silver market is actually pretty small compared to other commodities markets, which operate rather differently to other financial markets because of the relationship between physical delivery and the symmetry of long and short positions. From my inexpert position, it sounded that whether speculators would be able to hold market-manipulating positions (shades of the Bunker Hunt brothers) is a matter of some speculation. A rise in volatility did occur, but it’s not clear what it means in the longer term.
(Not all commodities markets are the same of course! Currie made the point that the gold ETF market is around $150 billion. If you ended up taking physical deliver of all of the that gold, you could put it in your shed. By comparison, the Oil ETF market is currently about 180 million barrels. If you end up with those on your hands you have a problem, which is why the value of oil temporarily dipped below zero last year.)
But back to silver.
Snippings 