In Ted Butler's Archive


It appears that we are on the threshold of being able to buy silver at prices that will never be lower. Silver prices are set to embark on an upside price journey that will reward those who own it in life-enhancing ways. It only seems logical to buy what is arguably the most undervalued investment asset of all after it experiences a price drop. It’s not just a question of being presented with the unexpected opportunity of what looks to be the final markdown of price in silver. It is more the near-certainty of the forces that will drive silver prices sharply higher. No greater upward price force exists than a physical shortage – or more demand than supply. On November 18, the Silver Institute estimated a silver deficit (more demand than supply) in 2022 of 194 million ounces. Later, on Feb 8, the estimate of the shortfall of supply was revised upward to 253 million ounces, the largest physical deficit in decades.

This latest statistic from the Institute caps a decade in which silver supply hasn’t increased while demand has. Silver’s continued low price has discouraged new supply and encouraged new demand, resulting in the largest physical deficit in decades. The stagnant physical supply and growing demand is confirmed by the rather shocking drawdowns in recorded inventories on the COMEX and elsewhere.

As to why the law of supply and demand doesn’t appear to be working in silver, you only need look at the ongoing price manipulation by large banks on the COMEX, mostly through the short selling of paper futures contracts. However, the manipulative activities of the banks on the COMEX which caused the recent sharp selloff in the price of silver complete the prospects for an imminent price explosion. These manipulative banks also see that the law of physical supply and demand is about to kick in with a vengeance and they are buying as many silver contracts as possible, in the only manner possible for them, namely, by rigging prices lower to induce speculative selling.

The bottom line is this – the physical deficit and shortage in silver has become so obvious and pronounced and the resultant drawdowns (and turnover) in recorded inventories have become so extreme, that continued low prices seem near-impossible. Add to this explosive price mix a pronounced buying spree by those responsible for the long-term price manipulation and sharply higher silver prices are as close to guaranteed as possible. It’s only a matter of time before silver prices surge and not much time at that. As an added bonus (as if one was necessary), the very high premiums on retail forms of silver have shrunk dramatically, offering buyers a separate and significant reason to take advantage of a price sale that won’t last. It’s been quite a long time that both wholesale and retail silver prices have been discounted and I expect that won’t last for long.

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