JPM owns 100,000,000 ounces of silver
JPM has sold 5,000,000,000 ounces in paper silver
If the price of physical silver gets driven up lets say 10$.
That means JPM's physical holding is worth 1 billion.
OMG YOU RETARDS ARE MAKING JPM MONEY!!
STOP BUYING SILVER!!
Guess what smoothbrain?
Their 5b in paper ounces now makes JPM liable to pay out 50,000,000,000
Yes that 50 billion dollars now JPM has to pay out of people redeem their paper silver.
Now imagine the whole market. Think that there are 500billion ounces of PAPER silver.
If the prices goes up 10$ 50% of the banks owe more money in paper silver than they are worth
If prices hit 50$ EVERY SINGLE BANK IS INSOLVENT.
Edit This is by no means an instruction manual to crush everyones 401ks, pensions, the whole thing. This is by no means a way the people could pull the veil off the final system and see whats really under neath. My favorite flavor is Blue crayon. This is more a warning I guess. That people need to have physical assets on HAND. Because this is how FUCKED UP AND CORRUPT our market is.
Also I dont know JPM's current paper silver sales. Last I saw they have 110 million ounces.
In 2014 bloomberg reported that the banks had leveraged the paper silver 250:1 of physical.
So grandscale is that there are 500-750 billion ounces of paper silver.
Silver goes up 10$ who the fuck is covering the bill on paper silver?
Also... Keep this in mind
The Bank of New York Mellon does not, however, deal directly with the public. In order for a shareholder to take delivery of the actual physical gold, he or she must be an authorized participant and deal in 100,000 share blocks. In addition, one looking to take delivery must make arrangements with their broker. That being said, a 100,000 share block at current prices equals a monetary value of approximately $12,572,000. Needless to say, this may be out of the reach of the vast majority of investors. The bottom line is that while taking delivery is possible for some, for most it is out of reach financially and also involves a process. In terms of SLV, a similar issue is presented. In order to try to redeem baskets of shares in SLV, one must be an authorized participant and deal in 50,000 share blocks. Once again, the large amount of shares required to take delivery may make it prohibitive for most investors.
In a large economic emergency, they don't have to exchange anything for you and you will be left with a worthless paper referencing gold or silver that doesn't belong to you.
TLDR if you are going to but precious metals, buy it physically.
THIS!^^
Yes I know. But it is supposed to tie to the price. So if physical silver goes up to 50$ then guess what these places are going to have to raise their prices.