We are witnessing a 45-80% divergence between the derivative price and the settlement price.
In a healthy market, arbitrageurs would close this gap in seconds.
The fact that they haven't proves one thing: The paper market is artificially capped.
The Mechanism: Naked Shorting to Save the Balance Sheet
Why is COMEX price suppressed?
Because the bullion banks are sitting on a massive net short position.
If Silver reprices to its true physical clearing level ($110-$130), the mark-to-market losses on those short derivatives would be CATASTROPHIC.
We are talking about billions in losses hitting bank Tier 1 capital ratios overnight.
They aren't trading Silver anymore, they’re trying to survive.
The Endgame: The Delivery Squeeze
This creates a Gresham’s Law event:
Investors are draining physical vaults (good money) while banks flood the market with paper contracts (bad money).
Eventually, the COMEX registered inventory will hit zero. When that happens, the "Paper Price" becomes irrelevant, and the price essentially goes vertical to meet the physical reality.
This isn't just manipulation. It’s a desperate attempt to prevent a solvency crisis.
I don’t understand why nobody is paying attention to this…
Most people are here to sell you dreams, but I’m here to tell you the truth.
I’ve been analyzing this for hours and things are about to get worse.
Here’s what happened:
I warned you that dealer balance sheets were constrained and that Treasuries had lost the capacity to absorb shocks quietly.
YESTERDAY, THE SYSTEM PROVED IT:
The Fed was forced to inject $74.6 BILLION in overnight liquidity to prevent a lock-up.
But the terrifying detail is in the collateral mix:
Banks pledged $43.1B in Mortgage-Backed Securities (MBS) versus only $31.5B in Treasuries.
Why does it matter?
Well, the private repo market rejected the banks collateral…
They had to go to the Fed window to survive the night.
We are no longer approaching the liquidity cliff… WE JUST DROVE OFF IT.
With the Reverse Repo (RRP) buffer officially drained, every new Treasury issuance from here on out will extract liquidity directly from bank reserves.
The shock absorber is completely gone.
If you aren't watching the 10-year yield right now, you are making a big mistake.
I’ll keep you updated in the next few days.
I’ve called EVERY major top and bottom for over a decade.
When I make my next move, I’ll share it here for everyone to see.
> China will attack Taiwan soon > US launched drone attacks in Venezuela > Putin residency was attacked > Putin to retaliate against Zelenskyy > Iran is about to collapse
But CT will have you believe that 2026 is bullish… my brother…
🚨BREAKING: THE FED JUST INJECTED $74.6B INTO THE FINANCIAL SYSTEM.
The largest liquidity injection in the last 12 months.
On the final days of 2025, banks pulled $74.6B from the Fed’s Standing Repo Facility, backed by Treasuries and mortgage bonds.
This was the largest single day usage ever since Covid.
This is not emergency QE or money printing.
What we’re seeing is a year end funding squeeze, something that happens almost every December. Banks often reduce private borrowing at year end to make balance sheets look clean.
When private funding tightens, they temporarily borrow from the Fed instead.
What matters is what happens next.
When year end funding stress shows up like this, the Fed usually stays flexible in the months after.
They avoid tightening too hard because they already see where the pressure points are.
That means:
- Less chance of aggressive tightening - More comfort with rate cuts or easy liquidity in 2026 - Lower risk of sudden funding shocks
For markets, this is important.
When the Fed quietly supports funding at the edges, risk assets usually benefit over time.
This is not instant bullish news.
But it reduces downside risk going into 2026, which is exactly what risk assets need before bigger moves start.