Silver Skyrockets Above $50, Massive Short Squeeze Leaves Market Liquidity Almost Completely Drained

BlockBeats News, October 12th: The spot price of silver has risen to above $50 per ounce, causing the London silver market to descend into chaos. A massive short squeeze has almost completely dried up market liquidity.

Traders point out that it is difficult to locate any available silver for shorting, forcing them to pay high borrowing costs for rolling over positions. Some traders have even booked cargo space on transatlantic flights to transport large silver bars, a costly shipping method usually reserved for more valuable gold.

Anant Jatia, Chief Investment Officer of the commodity hedge fund Greenland Investment Management, stated that he has never seen a market situation like this where silver currently lacks liquidity. This unprecedented scenario has caused the premium of the London silver market over the New York market to surge from the usual around 3 cents to over 20 cents. Robert Gottlieb, Managing Director at JPMorgan, pointed out that banks are now unwilling to quote each other, leading to significant spreads, which is also a result of the liquidity crunch. (FX168)