Vaccine, GOP problems driving silver prices higher.<\/b>
\nDespite reports to the contrary, the recent surge in the price of silver has little to do with the Reddit group that sparked a monster-size rally in the price of beleaguered retailer GameStop GME. Instead, the rally in the price of the white metal is being driven largely by inner turmoil in the Republican Party and worries that the COVID-19 vaccine plan is failing, according to commodities consulting firm CPM Group. \u201cWhat we saw has a lot more to do with the political situation and the pandemic than it does with the shenanigans of the Reddit group,\u201d says Jeff Christian, managing partner of CPM Group in a recent video. You can watch the video here. \u201cThe Reddit guys aren\u2019t nearly as important as a lot of people think,\u201d Christian says. The price of the iShares Silver Trust (SLV) SLV, which holds bars of solid bullion, hit its highest price since March 2013 in premarket trading Monday. Silver bullion futures were recently fetching $29.89 a troy ounce on the Comex, up 17% from $25.39 on Wednesday. The rally in silver comes just days after hedge fund investors suffered major losses in GameStop after betting that the stock would go down. A group of investors who were part of a Reddit chat group drove the stock to absurdly high levels causing the hedge fund bets to go sour. While some say that the Reddit group will do the same to silver, CPM\u2019s Christian says the problems in politics and the economy are far more important in the recent rally and also in a likely forthcoming silver market rally. \u201cInvestors are looking at problems in the vaccine distribution system,\u201d Christian says. \u201cIt\u2019s failing in the United States and not doing well in a lot of other places.\u201d Last week 17,000 vaccine doses were delivered to help immunize the 9 million people in New York, he says. \u201cObviously, that\u2019s not going to work.\u201d Or as Christian put it, at that rate of vaccination we\u2019ll still be waiting for years before the pandemic is under control. Separately, but no less important, are the problems in Washington DC. Christian notes that both parties are undergoing some introspection but that is far nastier in the Republican Party than it is for the Democrats. \u201cThere\u2019s a real division in the Republican party,\u201d he says. These two issues have investors spooked enough to buy silver, an investment that doesn\u2019t yield dividends and actually costs people to own. Christian sees the price of the metal climbing substantially higher over the next three to five years driven partly by investment demand. Investors bought approximately 103 million troy ounces in 2020, up from around a third of that in each of 2018 and 2019, Christian says. \u201cYou\u2019ve seen investors get much more keen about silver,\u201d he says.<\/p>\n