BUY THE DIP OR GET LEFT BEHIND: The Gold & Silver Shakeout Was a Setup, Not a Signal to Run

The Friday Selloff: What Actually Happened

Let’s start with the most important point, because this is where most people get it wrong.

Gold and silver did not collapse because the story changed.

They sold off because the short-term trade got crowded.

As Jim Rickards laid out clearly, the drop was driven by:

• Hedge funds locking in huge leveraged profits
• Algorithmic momentum trading flipping from “buy” to “sell”
• Stop-loss orders cascading once prices started to fall
• A little panic mixed in at the end, as always

That’s not a failure of gold or silver. That’s a textbook bull market correction.

I’ve been around markets long enough to tell you this: when prices move straight up, the market always takes something back. Two steps forward, one step back. Rinse and repeat.

Kevin Warsh Was a Trigger — Not the Real Cause

The media needed a headline, so they grabbed onto President Trump’s nomination of Kevin Warsh to run the Fed.

The story goes like this:
“Warsh is a hawk, rates will stay high, the dollar will surge, gold must fall.”

Sounds neat. Sounds logical. Sounds wrong.

Here’s the reality:

• The U.S. debt-to-GDP ratio is north of 125%
• The government is adding roughly $1 trillion in new debt every three months
• Interest costs alone are already over $1 trillion per year

In 1980, Paul Volcker could raise rates because U.S. debt was manageable. Today? Try that and the Treasury goes insolvent.

So no, Warsh is not the second coming of Volcker. He can’t be. The math doesn’t allow it.

Higher debt ultimately means lower rates, more liquidity, and more currency debasement. And that is long-term bullish for real assets.

This Was a Paper Market Event — Not a Metal Event

Here’s where the second article really drives the point home.

While paper silver in New York and London collapsed, physical silver in Shanghai barely blinked. In fact, it continued trading at dramatically higher prices.

That tells you everything you need to know.

• No mines shut down
• No industrial demand disappeared
• No central banks dumped their gold
• No new supply magically appeared

What blew up were paper claims, not real metal.

When you have hundreds of paper contracts chasing a single ounce of silver, eventually the paper burns. That’s what last Friday was about.

As I’ve said for years:
Metal doesn’t lie. Paper does.

Corrections Are Normal — History Proves It

People forget this, especially newer investors.

During the 1970s bull market:

• Gold rose from $35 to $850
• Along the way, it suffered three separate 30%+ drawdowns
• In 1975 alone, gold fell nearly 47% before roaring higher

Anyone who panicked out during those corrections missed the real move.

What we’re seeing now fits that historical pattern almost perfectly. Strong secular bull markets don’t end with volatility — they include volatility.

 

Why the Long-Term Case Is Still Rock-Solid

If anything, the bigger picture has only gotten stronger.

The forces driving gold and silver higher have not changed, and they are not reversing anytime soon. Central banks around the world are accumulating gold, not selling it, because they no longer trust the stability—or neutrality—of the dollar system. Russia proved beyond doubt that physical gold functions as real sanctions insurance, and that lesson has not been lost on the rest of the world. As a result, BRICS nations and other non-aligned countries are actively reducing their dollar exposure, quietly but consistently.

At the same time, global debt levels have crossed into mathematically unpayable territory, and every major government response involves more borrowing, more money creation, and more distortion. Confidence in fiat currencies continues to erode—not overnight, but relentlessly. And while paper markets can manufacture supply with a keystroke, the physical supply of silver remains structurally tight, with no fast or easy way to increase production.

This is no longer just an inflation trade.

Gold and silver are increasingly functioning as monetary hedges against geopolitical risk, financial repression, and currency weaponization. That is a much bigger story than a one-day selloff—and it plays out over years, not trading sessions.

My Take: This Was a Washout, Not a Warning

I agree with Rickards’ conclusion, and I’ll say it plainly.

Last Friday was a classic washout. Weak hands were flushed out, leveraged traders rang the register, and through it all, the long-term fundamentals never blinked. That is exactly how bull markets reset before the next leg higher.

If you already own real, physical metal, the correct move was simple: do nothing. If you were under-allocated or still on the sidelines, this pullback offered a rare second chance to position without chasing momentum.

The biggest mistake investors make—over and over—is letting short-term price action override long-term reality. Markets are noisy. Fundamentals are not.

Final Thoughts: Positioning Matters More Than Price

I grew up working class. I know what it feels like to worry about savings, retirement, and whether the rules will change overnight—because they often do.

That’s why I don’t obsess over daily price ticks.

I care about who controls the money, who carries the debt, and who holds the real assets when confidence finally cracks. Those are the questions that matter when systems come under stress.

This market is shaking out tourists and handing opportunity to adults.

The real question isn’t whether gold and silver will matter going forward.
The question is whether you’ll be positioned before the next move forces everyone else to wake up.

Call to Action

If you want clear-eyed analysis, real-world strategy, and guidance built for times like these, I strongly encourage you to join the Inner Circle.

That’s where we focus on protecting wealth, cutting through noise, and positioning before the crowd — not after.