Early this 2021 with retail investors spurring on ‘meme stocks’. But in his heat other sub-forums like , originated with the idea of hoarding as much money as possible in a more inflationary environment than what the authorities say were born. The premise is to raise the price so much as to ‘bend the arm’ of the large financial institutions that lead the world trade in precious metals and thus bring down what they consider to be an unfair banking system.
The task is arduous, but these members do not give up. “In a year or two we will have millions of people in the movement,” Ivan Bayoukhi, the 24-year-old former car salesman still living with his parents, who created this subforum in January, predicts excitedly to Reuters. Today there are 122,000 members in the community, which ranks 3,783 on Reddit by size. That does not mean that they do not make a lot of noise: it is usually in the top 20 by volume of publications per day.
The members of the community, who consider themselves a “family”, call themselves “apes” in an English pun between ape and a contraction of stackers. They have a home page with a picture of an army of primates from the movie Planet of the Apes and organize themselves to, on some days, all buy silver at once. The idea is clear: you have to hoard as much as possible.
One testimony is given by Kerry Kraker, 56, who has worked in kitchens all her life. Since March she has spent about $100 a week – half of her extra money – on silver coins. “There’s a bit of anger, like ‘fuck the system.’ If there’s a back door to riches, I could take that door because the front door is locked,” she told Reuters. “The bankers and others have basically closed that door on everyone who isn’t themselves,” she adds.
With silver hovering around $26 an ounce, these ‘metal freaks’ believe the price will rise as inflation erodes the value of money, demand for silver rises and supplies tighten. Some say that by buying bullion and coins they can increase prices by 100% or even 1,000%, to the point where they can get ahead of the so-called bullion banks, the big financial institutions that lead the precious metals trade.
The truth is that the prices of silver and gold, usual haven assets and stores of value, have risen since 2019: gold by around 40% and . These Reddit hoarders are truly the latest in a movement of millions of people around the world that has long believed fiat money is vulnerable, a fear that has grown as authorities have borrowed and printed money for years. the pandemic.
The ‘innovative’ idea underlying these foreros is that if enough people bought the metal, they could drive prices to the moon. “Corral the market”, summed up one of them in the forum. Added to this was the argument made on Reddit that big banks trade huge amounts of paper contracts for silver they don’t have, keeping prices lower than they should be.
They are not completely off track. In the New York futures market alone there are contracts representing some 800 million ounces of silver, more than double the amount the exchange says is in its registered vaults. In the same vein, much of the silver that banks buy and sell in London, another major center of commerce, is borrowed. If all the professionals holding paper silver claimed their dues at once, there would not be enough metal on hand.
However… do these ‘apes’ have chances of success? Although some $3 billion has been rushed into a fund managed by Blackrock that stores silver for investors and prices have jumped 20% in one fell swoop, the mission seems virtually impossible.
a difficult mission
No matter how much silver they hoard, whether in ounces, bullion, or coins, these Reddit insiders are targeting a very small fraction of the silver industry. Only a quarter of the roughly 1 billion ounces produced each year is used to make the bars and coins most of them buy. Most of the rest is used in jewelry and industrial applications.
Michael Mesaric, who runs the world’s largest gold and silver refiner, Valcambi, in Switzerland, says that 1,000-ounce silver bars being used on the wholesale market are plentiful. For small investors to think they can corner the market is “dead wrong,” he says. “They can figure out how to squeeze the produce,” he says. “But the money in total? They will have a very difficult time.”
Silver coins and bars can hold their value. Rising inflation should drive up prices, as should growing demand from manufacturers for products like electronics and solar panels, says Rhona O’Connell, an analyst at StoneX. But she and other companies that trade the metal believe the $1,000-an-ounce predictions are out of the ordinary.
The definitive proof of the unfeasibility of the company -without taking into account that inflation remains controlled, as the central banks guarantee-, is that since the birth of this revolt, silver, which touched 29 dollars at the beginning of February, has It is now stable at around 26 dollars. Few analysts dare to place it at 30 dollars and, according to Reuters, the most daring placed it at 44. Very far from what the ‘apes’ want.
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