Are Gold & Silver Breaking Out? | Andy Schectman

Finance-focused summary (gold & silver breakout / premiums thesis)

Market view: gold & silver “breaking out”

• Gold: The price action is described as forming a falling wedge that has broken out to the upside, which is framed as very bullish and potentially signaling a trend change after a year of declines.
• Silver: A similar falling wedge breakout is claimed.
• Caveat (Andy): Technical patterns may matter, but he argues they’re less reliable in a manipulated/controlled market. Still, he views the breakout as meaningful given accompanying changes in “price discovery.”

Why he believes the breakout is sustainable (macro + market structure claims)

Shift in price discovery toward Asia

He points to changes involving settlement and exchange mechanics across:

• Dubai
• Singapore
• Hong Kong

Key elements mentioned:

• Same-day settlement
• In Hong Kong, settlement is said to occur in yuan rather than dollars
• Growth of physical settlement and exchange-for-physical (EXPH) concepts, which he claims create arbitrage against London/US pricing
• A claim that Hong Kong is developing a facility that settles in another currency and challenges Western pricing

China / central-bank demand as validation

• He cites a Reuters headline: “China’s gold reserves rise by most since October 2023… buying pace quickens.”
• He argues central bank buying is potentially higher than some widely cited numbers:
  • He references a dispute involving the World Gold Council (WGC) vs other claims, including an example he summarizes as:
    • “Bought 16 tons” versus WGC “244 tons” (as he characterizes it)
• Additional flow numbers mentioned:
  • Q2 central bank purchases around 62 tons (noted as year-over-year context)
  • Later: “Now up to… 289 tons,” described as the biggest quarterly addition since Q4 2024
  • He also asserts YTD central bank buying totals ~345 tons, which he connects to an approximate value in USD (based on an ounce conversion)

Rates / dollar / “trust” narrative

• He argues the main driver is loss of trust in US Treasuries, not just inflation prints.
• A key interpretation: rates rising while the dollar falls is taken as evidence that major investors do not trust US Treasury safety/liquidity.
• He suggests the Fed is “trapped” (not fully quantified), implying future inflation pressure.

Crypto linkage (Tether hypothesis)

• Tether (USDT) is central to his speculative theory of gold accumulation via a proxy entity.
• Claims he makes include:
  • Tether “added another 14 tons” in a quarter
  • Tether has about $19 billion in gold (as asserted in the conversation)
• He also references a cooperation angle with the US Justice Department, claiming freezing of IRGC-linked wallets at the smart-contract level (described narratively rather than with primary documentation).
• Hypothesis: If the US government wanted to support gold accumulation without crowding the market, it could be done via Tether, with gold later transferred/“siphoned” to the Treasury.
• Storage claim: He suggests gold is likely held in Zurich, Switzerland vaults.
• Disclaimers: He explicitly calls this “100% conjecture”, while still stating that he believes flows are happening.

Performance / risk commentary (what he implies investors should expect)

• “Smart money”: The claim is that informed traders are buying while retail sells—potentially through standing for delivery and “removing from exchanges.”
• Margin / positioning / “misdirection”
  • He points to CME Group increasing margins (described as raising margins by 300%).
  • He argues the January move functioned like a coordinated squeeze/margin event, wiping out open interest and forcing liquidation.

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Step-by-step / framework elements mentioned

Technical “breakout” framework (described conceptually)

1. Identify a falling wedge:
   • Price declines bounded by converging trend lines.
2. Draw a parallel/reference line from:
   • The peak/tangent and the lower boundary.
3. Look for a breakout above the wedge:
   • Interpreted as a bullish trend change for both gold and silver.

Premium cycle explanation framework (how he thinks pricing misbehaves)

He attributes extreme premium compression (and expected normalization) to a “perfect storm,” including:

• Public selling into price runs after volatility events
• Dealer hedging costs rising sharply due to exchange margin hikes
• ETF rebalancing (first week of January) forcing additional selling pressure
• Primary distributors needing to take 2026 allocations across multiple metals channels/countries
• Resulting mechanics:
  • Liquidity dries up
  • Dealers “bleed” from hedging
  • Premiums collapse
• Outlook:
  • If selling pressure abates and the next run-up differs, he expects premiums to rise as demand meets constraints.

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Key numbers and explicit claims (as stated)

Central bank / buying pace (as he quoted)

• Disputed figures: “16 tons” vs WGC “244 tons” (his view: underreporting)
• Mentions:
  • Q2 around 62 tons (year-over-year context)
  • 289 tons as biggest quarterly addition since Q4 2024
  • YTD ~345 tons (his stated math toward ~$48 billion using an ounce conversion)

Hedging and margin costs

Example given for silver hedging:

• Early December: ~$15,000 margin/account to hedge 5,000 ounces (one contract)
• Five weeks later: ~$54,000 margin for the same 5,000 ounces
• His claim: hedging costs became “parabolic.”

Premiums (physical market)

• “Junk silver” premiums cited:
  • As low as $2 under spot
  • Later: 75 cents under spot
• Outlook: premiums are expected to normalize upward, potentially moving higher over time.

Seasonality (timing)

• Precious metals are said to do best in August/September/October.

Storage / operations

• Mentions Brinks vaults in North America and storage programs.
• Cities listed:
  • Toronto, Montreal, Vancouver, Los Angeles, Dallas, Salt Lake City, Miami, New York City
• He states there are nine vaults.

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Explicit recommendations / investor actions

• “Good time to buy” (with caveats): He says it “is a good time” due to breakout signals, flows, and seasonality.
  • Caveat: price could still drop; “nobody knows.”
• Dollar-cost averaging (DCA):
  • If uncertain, he recommends cost averaging—splitting a total buy into multiple transactions over time.
• Physical vs ETF framing:
  • Encourages owning physical metals and avoiding heavy reliance on ETFs, citing storage certainty and “counterparty” risk.
• Dealer selection / hedging:
  • Strong caution to use reputable dealers who hedge.
  • Reason: if a dealer doesn’t hedge properly, they may go out of business if spot moves against them.

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Disclosures / disclaimers mentioned

• “Nobody knows” how far gold/silver could drop; he frames outcomes as probabilities.
• The Tether/gold transfer mechanism is explicitly described as 100% conjecture.
• The advice is presented as hypothesis-driven, not guaranteed.
• There is also mention of Thoughtful Money host-level endorsement/disclosure structure (advisors/services), though not as a formal regulatory disclaimer within the transcript.

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Tickers / instruments / assets mentioned

Precious metals

• Gold (including references to “pre-1933 gold coins,” “graded pre33,” and gold eagles)
• Silver (including junk silver, Morgan silver dollars, silver eagles, “pre65 junk silver”)
• Platinum, palladium

Commodities / market infrastructure

• CME Group
• COMEX
• ETFs (mentioned generally; no specific ETF ticker)

Crypto / stablecoin

• Tether (USDT)

Macro / rates

• 10-year Treasury (referenced indirectly; described as “over 4%”)

Entities named (not tickers)

• World Gold Council
• Reuters
• Goldman Sachs
• BIS
• Justice Department

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Presenters / sources at end

• Adam Tagert (host, Thoughtful Money)
• Andy Schectman / Andy Sheckchman (CEO, Miles Franklin; interviewee)

Sources explicitly mentioned

• Reuters
• World Gold Council
• Goldman Sachs
• BIS
• CME Group
• COMEX
• US Justice Department (no specific individual named)