A Statistical Impossibility, Engineered Chaos, 5 Theories to Why, $7T Erased, The Physical Frenzy, & the Violent Birth Attempt of a New Monetary Order!

In a span of 24 hours, over $7 TRILLION in notional value was erased from gold and silver. Wow, breath-taking!

This was not a correction. This was not a pullback. This was a DECLARATION OF WAR, a financial shock and awe campaign of such historic, unprecedented violence that it has left the entire world reeling, and asking, “what in the world just happened?!”

• Silver: Plunged as much as 35% intraday, its largest one-day percentage decline in history, wiping out nearly $2 trillion in value. At its nadir, it touched significantly below $80 an ounce after being near $122 only a few dozen hours earlier.

• Gold: Collapsed 10.2%, a staggering $5 trillion evaporation of value, falling from over $5,600 to well below $4,700.

To call this a “crash” is to do it a disservice. This was a statistical impossibility. A 10-sigma event in silver. An 8.1-sigma event in gold. These are events that, according to standard financial models, should never happen in the lifetime of the universe, let alone in the same week.

To put it in perspective; a 10-sigma event has a statistical probability of occurring once every 5.25 septillion years. A septillion is a 1 with 24 zeros after it. Now multiply that by 5.25 times!

Let that sink in. What happened yesterday was not a “natural” market move. It was engineered. It was a deliberate, calculated act of financial warfare. Anyone claiming this was a normal market event is either a fool, a liar, or has a nefarious agenda.

And yet, in the midst of this carnage, a strange thing happened. The retail market didn’t panic. It actually went into a buying frenzy.

• APMEX, one of the largest precious metals retailers in North America, was forced to implement a “wait queue” just to access its website.
• JM Bullion and other major online dealers experienced repeated site crashes as hordes of buyers flooded their systems, eager to stack physical metal at these artificially suppressed prices.

This is the great disconnect. While the paper markets in New York were being carpet-bombed with an avalanche of derivatives, the physical markets around the world were screaming for more supply.

• While the Western media and many experts declared the bull market dead, buyers in China and India were still paying premiums well over $100 for physical silver. How does this make sense?
• While the algorithms were force-selling over $4 billion in precious metal ETFs, real people were lining up to buy real money. See the contradiction?

Below, I sift through the wreckage and attempt to make sense of the senseless. To conduct an investigation into the anatomy of a financial crime, an exploration of the competing theories behind this historic event, and make a strong declaration that this is not the end of the precious metals bull market.

The reality is this is the beginning of the end for the old system. These are the violent birth pangs of a new monetary order trying to form, one based not on paper promises, digital illusions, and out and out control, but on the timeless, immutable truth of physical gold and silver.

• You need to know that over $7 TRILLION was erased from precious metals in 24 hours yesterday. This was not a normal correction; it was a declaration of war!
• You need to know this was a 10-sigma event in silver and an 8.1-sigma event in gold. These are statistical impossibilities that should occur once every 5.25 septillion years (silver) and 1.3 trillion years (gold). Bottom line: this was not a natural market move; it was engineered, but by who?
• You need to know the retail market went into a buying frenzy, not a panic. APMEX implemented a wait queue just to access its website. JM Bullion crashed repeatedly from overwhelming buy orders. While the paper markets were being carpet-bombed, real people were lining up to buy real money!
• You need to know China and India were still trading physical silver well above $100. The physical market refused to follow the paper market’s manufactured price; why the great disconnect?
• You need to know that even after crashing 35% in one day, silver is still GREEN for the month (+20%) and has risen for 9-STRAIGHT months. And silver is still almost ~3x higher than it was just 9 months ago!
• You need to know sector veteran Rick Rule warned us last week at VRIC: “In the 1970s, gold fell 3 times by 30% or more.” In 1975, gold fell from $200 to $100. Everyone shaken out at $100 missed the move to $850 by 1980. These violent pullbacks are not a bug; they are a feature of secular bull markets!
• You need to know the five theories circulating about what happened. I will detail them below!
• You need to know the truth is likely a synthesis of all five theories. This was a multi-faceted operation with multiple goals, all contributing to the same outcome: the most violent and statistically impossible price crash in modern history and the implementation of inordinate fear levels into the investor!
• You need to know silver miners are now the opportunity of a generation. After being taken to the woodshed, they are trading at valuations completely disconnected from the price of the metal they produce and the profits they are achieving. Even at ~$80 silver, they are generating record cash flows with profit margins of 300-400%!
• And you need to know this is not the end of the bull market; it’s the beginning of the end for the old system. What we are witnessing are the violent birth pangs of a new monetary order based on physical gold and silver and the 10-sigma crash was not the end!

The 10-SIGMA crash in silver is a statistical impossibility. It was engineered chaos that erased $7 trillion in a few hours and yet unleashed a feeding frenzy for the physical metal. Make it make sense!

Let’s Dig Into The Following:

1. Yesterday’s 10-sigma event is a statistical impossibility so clearly there was a financial crime that needs to be analyzed. This was not a case of “too many sellers and not enough buyers.” This was a coordinated, weaponized dump of paper derivatives (futures, options, swaps) in order to trigger a cascading collapse. There were other things that helped it along, including; the huge run-up in price over the last few weeks, the algorithim’s, the COMEX circuit breaker malfunction, and of course, fear. Why the goal of this attack was not price discovery; it was price destruction, a financial carpet-bombing campaign designed to break the market structure and inflict maximum psychological damage!
2. And yet there was a great disconnect between the paper and physical worlds. The most telling evidence that this was an engineered event is the massive, glaring disconnect that immediately opened up between the paper price and the physical price. While the COMEX paper price for silver was being smashed below $80, what was happening in the real world? There was a retail frenzy unfolding. Major online retailers like APMEX and JM Bullion were overwhelmed with buy orders. People weren’t selling; they were buying. Why they saw the paper price as an artificial, temporary discount on real money!
3. Let’s not gloss over the Shanghai and Mumbai premiums either. In China and India, the two largest consumers of physical precious metals on the planet, the price for physical silver remained stubbornly high, trading at a significant premium to the Western paper price. Why this tells us that the demand for real, physical metal in the East is relentless and that they view the Western paper markets with increasing irrelevance!
4. So, we have done an investigation into the 5 most compelling theories floating around as to the potential cause of what happened yesterday, each likely with some truth behind them. When a crime of this magnitude is committed, there are always multiple suspects and multiple motives. The 10-sigma crash was not a random act of nature; it was a “no-doubt about it” planned operation. Why the operation they pulled off was designed to send a clear and unambiguous message: “This market is not for you. It is too dangerous. You will lose everything. turn around and go back to the safety of your 401(k), your 7-10% annual returns, and your financial advisor…NOW!”
5. Rick Rule’s message and the wisdom of the ages should be strictly listened to. In moments of such extreme chaos and fear, it is essential to seek out the wisdom of those who have been here before. Rick Rule, the legendary resource investor, has successfully navigated every precious metals bull market of the last 50 years. Just last week, at the Vancouver Resource Investment Conference, as if anticipating the coming storm, Rick shared a piece of wisdom that is absolutely critical to understand today: “We’re in a bull market; don’t waste it. In the 1970s, the gold price fell 3 times by 30% or more. In 1975, gold fell from $200 to $100. Everyone shaken out at $100 missed the move to $850 by 1980.“ Why this was exactly the kind of event that Rick has been warning us about for years, that it does not signal the end of the bull market; it signals that the bull market is alive and well, and is behaving exactly as we should expect all great bull markets to behave!
6. Now, in the wake of yesterday’s engineered nuclear strike, silver miners present the generational opportunity. Always, after an epic crash, fear is the overwhelming and dominant emotion. The instinct is to run, to hide, to avoid anything associated with the source of the pain. And right now, after this beatdown, there is no asset class more feared, more hated, and really, more misunderstood than the silver miners. Why this is precisely why they represent the single greatest investment opportunity of this moment in time!
7. And the birth pangs of a new system are now upon us. So, what is the truth? What is the real signal amidst all this noise, manipulation, and fear? The truth is that the old system is dying. The post-1971 experiment of a global monetary system based on an irredeemable fiat U.S. dollar backed by nothing, is in its death throes. The mountains of unpayable debt, the geopolitical fracturing, the desire by other countries to get out from under the control of the U.S. dollar, the loss of faith in institutions; these are not cyclical problems; they are systemic. The system is breaking under the weight of its own contradictions and a new system is trying to bloom in its wake. Why what we are witnessing in the gold and silver markets are the violent, chaotic, and often terrifying birth pangs of a new system trying to be born!