Silver Squeeze Is Over According To TD's Daniel Ghali

Key Concepts

• Silver Squeeze Transition: The shift from a physical shortage of silver to an inventory saturation due to rebuilding LBMA stocks.
• Inventory Saturation: A state where available inventory exceeds immediate demand, leading to price normalization.
• LBMA Stocks: Inventories held by the London Bullion Market Association, a key indicator of silver availability.
• Price Normalization: A return of prices to a more stable, expected range after periods of volatility.
• Asymmetric Upside: A situation where potential gains are significantly larger than potential losses.
• Platinum and Palladium: Precious metals identified as having structural underpricing and potential for significant upside.
• Gold as Macro Hedge: Gold's continued role as a primary hedge against monetary stress and economic uncertainty.
• India's Silver Monetization: The Reserve Bank of India's policy allowing loans against silver jewelry and coins, unlocking household wealth.
• Collateralized Household Credit: The use of assets like silver jewelry as security for loans.
• Market Structure Change: Fundamental shifts in how markets operate, driven by new policies or demand patterns.
• BRICS Gold-Backed Unit: A private entity associated with BRICS nations, potentially backed by gold, signaling a move towards alternative financial systems.
• Central Bank Gold Buying: Increased purchasing of gold by central banks, indicating a diversification away from traditional reserve currencies.
• Capital Gains Tax on Precious Metals: The impact of capital gains taxes on the acquisition and holding of gold and silver, and proposals for their removal.
• Backwardation: A market condition where the futures price of a commodity is lower than the spot price, often indicating immediate tightness or demand.
• Lease Rates: The cost of borrowing precious metals, which can indicate tightness in the market.

TD's Analysis of Silver Market Dynamics

TD's Dan posits that the perceived "silver squeeze" has evolved. The initial phase, characterized by a physical shortage, has transitioned into an "inventory saturation." This shift is evidenced by a significant rebuilding of stocks within the London Bullion Market Association (LBMA). This influx of metal is described as "distorting liquidity," suggesting that the ease with which metal can be traded is being affected. Consequently, TD anticipates a "price normalization" for silver, projecting a price range in the "mid-40s" sometime in 2026.

In contrast to silver, TD views platinum and palladium as "structurally underpriced." Their bullish outlook for these metals is supported by several factors:

• Rising US Vehicle Density: An increase in the number of vehicles in use, which drives demand for platinum and palladium used in catalytic converters.
• Delayed Scrap Recovery: A lag in the return of platinum and palladium from end-of-life vehicles and industrial equipment, tightening supply.
• Persistent Mining Underinvestment: Insufficient investment in new mining projects, leading to long-term supply constraints and "multi-year deficit risks."

Gold, according to TD's analysis, will continue to serve as the "dominant macro hedge." Their 2026 review targets a "trading top" for gold at $4,400 by early 2026, indicating a continued upward trend driven by monetary stress.

The speaker, Vince Lansancy, acknowledges Dan's prior insights, particularly his identification of the "slow motion silver squeeze." Lansancy elaborates on the current silver market dynamics, emphasizing that while physical demand remains strong, the issue is not a lack of metal but rather its controlled availability. He explains that when the CME (Chicago Mercantile Exchange) shut down and metal was moved from "registered" to "eligible" status (making it unavailable for delivery), this was a strategic move to buy time for the LBMA to replenish its stocks.

Lansancy describes the typical market behavior when a shortage is being addressed:

1. Volatile Chop and Baselining: The market experiences significant price swings followed by stabilization, potentially with a dip before settling at a higher level.
2. Stable Lease Rates: Lease rates do not increase, indicating that the tightness is not due to a lack of metal but a deliberate withholding of it.
3. Metal Influx: Silver begins to flow back into the market.
4. Shorts Paying Backwardation: Short-sellers, particularly LBMA member banks unable to make immediate deliveries, are forced to pay a monthly "tax" in the form of backwardation to roll their positions. This is seen as the cost of doing business while sourcing the metal.

Lansancy expresses his personal bullishness on silver and his long position, but clarifies that he does not believe a true "short squeeze" has occurred. Instead, he frames the situation as "tightness." He argues that the LBMA is "broken" but is attempting to prevent the issue from spreading to the US market. The strategy, in his opinion, is to signal to those seeking immediate delivery: "back off. We'll give it to you in 30 days. We got plenty of metal. We just need to get it where it needs to go." This effort is seen as an attempt to "make this right" and protect "Western Hemisphere global dollar dominance."

He reiterates that while silver could reach $60, the authorities do not want it to happen too quickly. The goal is to prevent panic buying from those who can no longer wait for delivery. The backwardation paid by banks is the "price of doing business" to source the metal. Once this process is complete, the market will not revert to its previous state; instead, there will be a greater reluctance to release metal, and shorts will be covering during rallies. This action is raising both the "floor" and the "roof" on silver prices, indicating a fundamental shift in market structure.

India Unlocks Silver's Buying Power

A significant market structure change is highlighted by India's new policy, allowing banks and non-bank financial institutions to extend loans against pledged silver jewelry and coins starting April 1, 2026. This policy formally expands collateralized household credit beyond gold for the first time under a unified regulatory framework.

Lansancy emphasizes the profound significance of this move, regardless of the immediate dollar or rupee amount. He explains that this policy empowers individuals who own silver jewelry not to sell it for immediate needs like food or investments. Instead, they can leverage their wealth. This contrasts with previous government efforts to encourage the surrender of gold and silver through gold bonds.

The Indian government is now recognizing and enabling the monetization of silver and gold wealth, acknowledging their durability and value as collateral. This policy is expected to:

• Increase Demand for Silver: Individuals may choose to borrow against their silver rather than sell it, and potentially purchase more silver to use as collateral.
• Stabilize Indian Stocks: By providing an alternative to selling assets for cash, this could stabilize the Indian stock market.
• Transform Silver into a Savings Account: Silver holdings will function more like a savings account, allowing for liquidity without liquidation.

This "bottom-up" approach by India is contrasted with China's "top-down" approach to gold ownership. The speaker speculates that this policy, combined with top-down initiatives in other countries, will lead to increased demand for silver, potentially through government-level "HQLA repo" (High-Quality Liquid Assets repurchase agreements) for gold and possibly silver, though he expresses reservations about silver's suitability as money due to its risk.

The long-term implication, according to Lansancy, is a potential scenario where individuals become overleveraged on silver and gold, leading to loan defaults and eventual government acquisition of these assets. He views this as the "end game" and believes the current policy marks the beginning of this process.

Other Market Developments and Analysis

The summary then touches upon several other important market developments:

• BRICS Gold-Backed Unit: The emergence of a private entity associated with BRICS nations, potentially backed by gold, is noted as a significant development, almost an "official product."
• JPM on Platinum: JPMorgan (JPM) forecasts platinum to remain "higher for longer," aligning with other bullish sentiment for the metal.
• Copper and Tariffs: Copper prices have risen significantly (7.5% in two weeks), attributed to a potential "tariff war." As more finished copper products enter the US, tariffs are expected to increase to protect domestic supply.
• JP Morgan on Gold and Silver (2026): JPM projects gold prices could reach $5,000 and potentially $6,000, especially if central bank buying continues.
• Central Bank Gold Buying Trends: Research indicates that central banks with over 20% gold reserves are still buying, aiming for 30%. Those with under 10% have just begun buying. This suggests a broadening trend in central bank gold acquisition.
• Capital Gains Tax Proposal: A proposal to remove capital gains taxes on gold and silver is discussed as a method to "secure supply chains," "augment the payment chain," and "put a floor under gold and silver." The current high capital gains tax rates (30% for holding over a year, 37% for less than a year) are seen as intentionally discouraging investment in precious metals.
• Flow Show Metals Chart Breakout: A brief mention of a positive technical signal for metals.
• BRICS Crossing the Rubicon: A metaphorical statement suggesting a significant step taken by BRICS nations.
• Jesse Livermore's Wisdom: A reminder of the trading principle that "size is everything," emphasizing the importance of trading appropriate volumes regardless of system quality.
• QT to QE Shift: Analysis of the Federal Reserve's transition from Quantitative Tightening (QT) to Quantitative Easing (QE), suggesting the Fed was not satisfied with its previous purchases and had to end QT early.

Data and Outlook

The week is characterized as "Fed week," with key data releases expected on Wednesday, including Fed Open Market Committee (FOMC) data. Other anticipated data points include job openings and jobless claims. The Mark Faber report is also mentioned.

The speaker concludes by noting that silver is currently down 9 cents, describing it as "volatile and capped." He suggests that while there is a floor due to buying activity, the price is currently being held back.

Conclusion

The overarching takeaway is that the silver market is undergoing a structural shift from a physical squeeze to inventory normalization, with TD forecasting a price correction to the mid-40s by 2026. Platinum and palladium are identified as having significant upside potential due to structural underpricing. Gold remains the primary macro hedge, with bullish targets for 2026. India's new policy to allow loans against silver jewelry is a major market structure change that will likely boost silver demand and monetize household wealth. Broader trends include increasing central bank gold buying and potential shifts in global financial architecture, exemplified by BRICS initiatives. The removal of capital gains taxes on precious metals is proposed as a key policy to encourage domestic holdings. The market is characterized by volatility, but underlying support and strategic management of supply are evident.