Can Reddit's silver 'apes' beat the market?

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Kerry Kraker, 56, has worked in kitchens all his life. Since March he's spent around $100 a week - half his spare cash – on silver coins. He's part of a growing social media movement who say they are buying bars and coins for protection from a coming age of inflation.

"In a year or two we will have millions of people in the movement," Bayoukhi told Reuters. "And then it will be over for the bullion banks."Prices of silver and gold, which are traditionally seen as safe stores of wealth, have risen since 2019: Gold is up around 40% and silver around 70% since then. The silver stackers are joining millions worldwide who believe currencies are vulnerable – a fear that has grown as governments borrowed and printed money in the pandemic.

If every professional who owns silver on paper called in their dues at once, there wouldn't be enough metal on hand, they agree. The system works because most people with contracts don't want actual metal, which they'd have to pay to store and insure. They are speculators, or miners and jewellers, hedging their risks.

Much of the silver stored for Blackrock is in London. The London Bullion Market Association , an industry body, later said that there had been "concerns that London would run out of silver."The Reddit group's founder Bayoukhi said he watched with growing excitement, turned to his father and said, "Why don't I start a Wall Street silver community?"There's also truth in Redditors' claims that big players can influence the silver market.

The January squeeze lasted three days. Then WallStreetBets returned its focus to stock markets; silver calmed. Since early February, the price of silver has fallen by a dollar. "They can engineer a squeeze on products," he said. "But silver in total? They'll have a hell of a time." Silver coins and bars can certainly hold their value. Higher inflation should lift prices, as will rising demand from makers of goods like electronics and solar panels, said Rhona O'Connell, an analyst at traders and brokers StoneX.

 

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