The Indicator from Planet Money - Hi Lo Silver

The price of silver shot up this week. Theories abound about what drove the trading.

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Content Keywords: indicator gme money silver gold GameStop
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NPR

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This is the indicator from Planet Money. I'm Stacey Vanek Smith over the last couple of weeks. We have seen some absolutely crazy volatility in the markets for certain share ride the video and computer game retailer GameStop. That's the big one the movie theater company AMC and several more I've seen all of these wild swings in their share price has spread from the stock market into Commodities namely silver which saw its price go up by as much as 13% to $30 an ounce, which is very expensive for silver may not sound like much like 13% gold and silver that is a lot and there's no really clear reason for this exactly and horse band of redditors from this message board called Wall Street bets they were of course behind the big push in GameStop stock last week.

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And whoever it was like oh my gosh, the redditors have done it again. Now, they're going after silver. Now. They're moving the price of metals on Reddit. But after that there was it was nothing is kind of sort of fizzled. I said it was it was kind of a mystery people were saying like well, maybe it wasn't actually right after all but nobody knew nobody knew what this was coming from coverage of the market. Nobody could figure it out and who was behind it or what their motivation might be. So we did what we do best to you actually trade silver day today, is that right time and I have for 15 years and years. So more from a veteran silver traitor after the break

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Support for this podcast in the following message come from E-Trade. You want to invest your money? But there's one problem. You're not sure where to begin. Luckily. There's E-Trade who offers more than just trading you trade simplifies investing without the financial. Jargon and has the people to offer guidance and support to make your money work hard for you for more information, visit etrade.com and PR E-Trade Securities, LLC member Benrus epiq Global markets the Bank of Montreal he wanted us to stress of his comments reflect his personal opinions, and I'm not the official position of the Bank of Montreal going to send to give me his thoughts about the very essence of silver the devil's metal because when it moves it can sit for a long time and not me, but when it moves that can move rapidly and with a certain amount of viciousness metal

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Reading seems the way more exciting than it usually does like the devil's metal. It's a very treacherous.

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So there are several theories that have been bouncing around the market now that bites this Spike and silver and why it happened and who is behind it? And let's not forget Silver's 13% swing oversleep pales in comparison to the nearly 500% jump in price that GameStop stock so last week but that doesn't mean that they weren't any casualties in the silver market and I asked I wear that maybe that was the whole point that like would GameStop stock some Traders might have tried to choke out the price of silver with the aim of hurting some big Wall Street players who were in the silver market Plaza first Theory and it was one that I had heard as well the stories that they made it to made its way on Reddit. Which one was that? JP Morgan was desperately short silver and would have to cover and this is the way to get a JPMorgan which is the biggest bank in the United States that theory has been around for a long time.

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It is also a Canard jpmorgan's one of the biggest bullion Bank in the world. They lend lot of metal out, but they typically do not lend it out. Uncollateralized. They say they'll in metal but you have to give them dollars. So while they may be short metal in a location for a short. Of time. It's never anything that could come anywhere near to bringing a major Bank near to its knees much less JP Morgan and maybe some of the short sellers who got squeezed on games. Last week might have been trying to distract what I like to call the Reddit lesions to shift their attention on their money and their trading activity the silver that seems a little far-fetched. I think if you were short gme in AMC, you're entirely consumed with trying to make sure you

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Position worked out. Well, you had enough funding the hold as long as you could I'm not sure those would be the folks would open up another another front in the in the war. So to speak against the redditors can't dismiss it completely out of hand, but that seems fairly unlikely. No or maybe was just a bad strike strike strike Series 3, then that some traders who are long silver which means that they own it and expected to rise in price. Maybe they kind of infiltrated the Reddit message boards in order to jack up the price of silver so that they could then make some money that that is an appealing narrative. If you're if you're wrong and you are and you're trying to push up the market with what would news like this even though you could search

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Create a Reddit account and use a VPN then try to keep your anonymity. It's clearly Market manipulation. Now. I'm not an attorney but this is a type of thing that might land a clever entrepreneur a long stay in a federal penitentiary and that's a pretty and that's a pretty steep price to pay jump into silver. You can literally go to jail. You could literally go to jail. So that's that seems like the stakes of a little bit too high for me. Either. But the fact is that something did happen to Silver this week. I reckoned. It was like a combination of rumors and the willingness of silver trade us to grasp this opportunity that was presented to them by this price surge the mindset of market makers and how many Traders are oh you want to push it push it as much as you like it. Once you're done. We'll see you, you know where we end up in it will go on.

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It will go on trading and doing what we typically do. In other words Ty says those silver Traders were quite happy to jump on that silver wave and ride it until it peaked but he stresses that the whole thing started with red. It's because that is where the exhortations to buy silver were first posted a couple of weeks that is suddenly moving markets and butt grabbing headlines and deciding to like go all in on stocks like GameStop at AMC and silver in like, you know, who is this group of people?

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So A D. Like I said, we did what we do best and we call someone and tomorrow we will talk with a Wall Street. That's Predator by the username Mia for real. Am I for real and tomorrow we get to the bottom of who these people are and what they want by using subtle and sophisticated interviewing techniques who knew her years and a career in professional journalism. I don't know. What do you want. Am I a free? Like, what do you want? Ya?

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This episode of the indicator was produced by Dave Blanchard and fact-checks my Samsung the indicator from planet money is a production of NPR.

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