Was the Silver Whale Identified in 2021-2022?

This week we dig into details about an SLV Silver Whale theory and investigate how credible these allegations might be.

We're talking about a financial institution that possibly has or is on the cusp of amassing a silver bullion hoard larger than either the 1970s Hunt Brother's 100 million oz or even Warren Buffet's Berkshire Hathaway's 129 million oz raid of silver from the COMEX in the late 1990s.

Following up on our breaking news report this past Monday regarding the explosions in Nickel and other base metal prices. The London Metals Exchange had a short squeeze in its nickel market zooming the price of nickel so high that US 5¢ cupro-nickel coins would be worth more than 3 times their face value if melted for their 75% copper and 25% nickel compositions.

We've warned you on this channel not only about Gresham's Law and disappearing circulating coinage in the USA becoming an increasing trend. 

But also the historic predictable fact that derivative driven 'price discovery' commodity and precious metals exchanges often halt short squeeze price ramps to bail out those insiders caught short on the cusp of suffering massive leveraged losses.

Well, this London Metals Exchange (LME) nickel trading halt and even trade repudiation situation appear to be more of the same. 

In order to know whose interest this first time in 145-year nickel trading haul decision is in favor of, all one has to do is a few minutes of research.

You see in 2012, the London Metals Exchange or LME was acquired for 1.4 billion fiat pounds not sterling by the Hong Kong Exchanges and Clearing.

And now just ten years later, they are apparently bailing out a massive Chinese commodity trader to the tune of saving him many billions in potential losses.

Bloomberg reported that Chinese tycoon Xiang Guangda is behind the big nickel short facing losses of more than $2 billion in merely one day of short face-ripping nickel price escalation. Surely there are other losses that had already been piling up prior.

You see Xiang Guangda, a known 'big-shot' in Chinese commodity circles and especially in nickel, as he is the reported controller of the world's largest nickel producer, Tsingshan Holding Group.

Apparently, Xiang got over his skies this past week and likely was forced to put in a few politically connected phone calls to the Hong Kong Metals Exchange to save his naked nickel short behind from further default.

Of course, the winning longs on these LME trades get screwed, and the politically connected skate on losses that should be paid even in bankruptcy court proceedings.

So what do many veteran financial market onlookers think of this news?

So a 30 standard deviation move in silver is now in the realm of its happened before in leveraged short squeezed metals trading. It's no wonder we have #SilverSqueeze meme makers are poking and hoping to see a historic upside move in silver akin to nickel.

The gold spot price and silver spot price turned positive weeks in trading action, with gold ramping just shy of its all-time record nominal price in fiat USD of $2070 oz.

Silver finishes the week just under $26 oz, with gold just under $2000 oz. 

The gold-silver ratio closed flat at 76.

With the government's rigged Consumer Price Inflation data coming in at a 42 year high just under 8% yr on yr, we take a quick glance at how volatile crude oil traded this week. Briefly spiking under $140 a barrel, none of these recently escalating commodity prices for energy in foodstuffs wherein the recent CPI data either, it's likely we are heading to double-digit CPI prints soon enough.

In terms of their 200 day moving averages throughout this full fiat currency era, here is how gold, silver, and crude's recent price ramping compare to their all-time run-up history.

Only two timeframes have the financial market ever seen a run like this for crude oil. 

It was only during the late 1973 1974 Arab oil embargo, and the fiat Iraqi Gulf War in the 1990s have we ever seen crude prices explode to the upside this quickly prior.

Turning now to our main story for this week's SD Bullion Market Update.


Before we begin going down SLV silver whale rabbit hole... shoutout to Bix Weir for one of his recent videos put me onto researching it.

A quick follow-up on this past Monday's breaking news report regarding the Russian bullion bar repudiation as Good Delivery Bars moving forward with either the LBMA or COMEX.

The list of suspended Russian silver refiners is larger than originally reported this week.

I did a quick look and it turns out over 8.2% of the silver bullion bars supposedly underlying the largest unsecured silver ETF in the world are Russian-made. I'll leave that data and those links in the show note here if you want to verify.

LBMA repudiated Russian Silver Bar Refinery Bars in the current SLV silver bullion bar list:

Krastsvetmet - 24,024

Novosibirsk - 494

Uralelectromed - 3,996

Prioksky - 7,044

Shyolkovsky - 2,198

Ekaterinburg - 1,559

OJSC - 6,554

So 45,869 now suspended Russian refined 1,000 oz silver bars out of reportedly 557,730 one thousand ounce bars held by the SLV trust with its custodian JP Morgan or 8.22% of all underlying in suspended Russian bullion bar hallmarks.

Again, the unsecured SLV silver ETF changed its rules during the kickoff of the Reddit Q1 Silver Squeeze movement, basically stating that if demand overwhelms supply, unsecured retail shareholders of the SLV could be the ones holding an underperforming and perhaps even a failing bag. All while physical silver bullion likely gaps higher in both bid and ask prices simultaneously. 

With that stated, it does not mean the SLV has not been recently used to suck physical bullion in 50,000 SLV lot redemption baskets for insiders. I'll show you that evidence shortly.

But you see for an aggressive financial institution, if it were looking to go mega long silver bullion to the size of a former Hunt Brothers or Warren Buffet sized stack, going through the dysfunctional COMEX would not only quickly escalate prices, it's arguable they may not even be able to do so successfully.

I mean, after all, the retail Reddit Silver Squeeze movement has already helped in sucking the COMEX registered or available silver bullion for delivery total by nearly half in just over one year of time. 

The amount of COMEX silver futures open interest versus registered available silver bullion supposedly deliverable piles underlying the entire dominant price discovery exchange is near 22 year low levels.

So again, where oh where might say someone find deliverable silver without making silver into nickel before they have established a dominant position to benefit.

Well, 1/2% a percent per year charging SLV seems to be the preferred option.

The SLV is often thought of as a slush fund used to deflect capital inflows from rapidly raising the silver spot price. A derivative where bullish silver bets often go to die all while paying fifty basis points per year to do so. 

But underneath SLV's not transparent murky waters is an interesting back story. First off, the silver bullion pile that SLV likely started its unsecured fund within 2006 was likely sold to it by Warren Buffett's Berkshire Hathaway after one of their subsidiary companies ran afoul with Federal laws. By 2007, the SLV had about 130 million ounces, thus the allegation persists that Berkshire Hathaway made a massive silver bullion sale to SLV for the trust’s starting position.

Anyways, what we are here to focus on today is massive in and outflow action of the supposed bullion that backstops the financial insider spot price suppressing silver slush fund.

Looking back to 2019 until today, we can better understand what may be happening under the SLV surface.

See the massive silver bullion blue bar inflows followed by massive red silver bullion bar outflows?

Here is a five-year chart for better detail of the last three years reflecting a pick up in both inflows and outflows of silver bullion within and out of the trust.

Do you see the massive silver bullion inflow spike from 2020 and especially in early 2021 before the silver squeeze movement kicked off in Feb 2021?

Here is the likely financial institution behind that, again shoutout to Bix Weir for pointing it out recently.

New Jersey-based Private Advisor Group, with now over reportedly $30 billion in total assets under management. 

They went massively long SLV in 2021, note that this data is always a few months delayed given quarterly 13-f filings of financial institution fund positions in stocks. But you can see where they jammed nearly $5 billion into SLV last year, around 200 million shares worth, and here's the key... those shares likely did not merely get sold off on a shorter bet and loss, no instead they likely got redeemed for physical bullion withdrawn from the SLV in 50,000 share redemption baskets.

You see regular retail investors cannot redeem their paltry shares from SLV for bullion but if you are a financial institution with the correct contacts with huge volumes of shares amassed, apparently you can suck 1,000 oz bullion bars from that slush fund.

Now let's go back and stare at 2021 red bar withdrawals illustrating millions upon millions of ounces withdrawing from the SLV to get an idea of what this trade likely was all about.

This is a two-year chart with the Reddit Silver Squeeze timeline injected so you can timetable this possible trade.

The peak of holdings within the SLV was 675 million ounces, right before they changed their prospectus, and likely following massive inflows from Private Advisors Group in New Jersey. Peak to trough, there were about 155 million ounces sucked out of SLV over 2021.

So the highest likelihood is Private Advisors is using the SLV as a way to amass a physical silver bullion position without rocking the spot price applecart. 

Also note that on the last filing to end 2021, Private Advisor Group has another big bet into SLV, this time to the tune of $1.3 billion and perhaps growing still. We'll have to wait until the next filing disclosure in April to know that.

Just based on their last public filing, the largest bet within their near $15 billion private funds is outsized into SLV, currently to the tune of about 8.8% of their entire portfolio, and almost two and half times the size of their next largest stock fund bet Apple.

And yes, note too here the fund also owns Sprott's PHYS close end gold fund, PSLV close end silver fund, and CEF the hybrid gold-silver former Central Fund of Canada fund acquired by Sprott a few years ago. 

None of Sprott's gold-silver closed-end fund's vehicles are large enough to handle this alleged silver whale bullion withdrawal tactic. And again, if Private Advisors Group tried something akin on the COMEX it's likely the spot price would climb as a result defeating the purpose of buying low and later selling high.

Last reported already Private Advisors Group has nearly 17% of the outstanding SLV shares issued. It is possible based on all this circumstantial evidence, they may become a larger silver whale than the Hunt Brothers and Warren Buffet combined by the time this trade plays itself out.

Even go check out their website if you like. Get a feel for who is behind this company.

Just a couple of clicks and I figured out that Guy Adami is a Markets & Investment Advisor for Private Advisor Group.

The same guy who knows about commodity exchanges screwing longs, as in the CFTC ‘TAMP-down’ festival at the end of January 2021, right as the Reddit Silver Squeeze movement was kicking off.

The same guy who knows that gold and silver are on the cusp of doing something nickel-like, likely later this decade. 

Listen to his words from this week again.

Bottom line, we have common base metal prices being short-squeezed to the moon. We have Russian silver bullion bars supposedly underlying nearly one-tenth of the world's largest unsecured silver slush fund now suspended, where will they find that replacement. 

Oh, and we have institutional funds likely using the said fund to squirrel away mass silver bullion redemption before SLV quietly closes that door too with another predictable prospectus and rule revision. 

Get your bullion positions sooner, not later. 

And as always to you out there, take great care of yourselves and those you love.

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James Anderson
James Anderson
Senior Market Analyst & Content

A bullion buyer years before the 2008 Global Financial Crisis, James Anderson is a grounded precious metals researcher, content creator, and physical investment grade bullion professional. He has authored several Gold & Silver Guides and has been featured on the History Channel, Zero Hedge, Gold-Eagle, Silver Seek, Value Walk and many more. You can pick up Jame's most recent, comprehensive 200+ Page book here at SD Bullion.

Given that repressed commodity values are now near 100-year low level valuations versus large US stocks, James remains convinced investors and savers should buy and maintain a prudent physical bullion position now, before more unfunded promises debase away in the coming decades...