“Physical is King”: Why the Global Silver Squeeze Could Shock U.S. Investors

India’s Silver Appetite Is Reshaping the Global Market

When you hear about massive silver imports, your first thought probably isn’t India. But it should be. According to Phil Baker, India imported 60 million ounces of silver in October 2024 alone — up 4X from just a year earlier. That’s a jaw-dropping figure, especially when you consider that silver is currently at all-time highs in rupee terms.

That means demand isn’t price-sensitive. It’s urgent. Cultural traditions, industrial growth, and currency hedging are converging in a single trend: India is hoarding silver, and it’s doing so with incredible force.

Baker made it crystal clear:

“India is the driver. That literally is the driver.”

And the metal is being shipped — or flown — halfway around the world to meet it. You don’t fly silver unless you have to. That tells you just how tight the market really is.

The Physical Market Is Now Leading the Price — Not the Other Way Around

For decades, silver prices were largely dictated by paper trades — futures, options, ETFs. That’s changing fast.

Baker, who’s been in this business for decades, said something we’ve never heard at this level before:

“The physical market is driving the financial market in a way that it hasn’t done in my career.”

That’s a major shift. The tail is no longer wagging the dog. Physical demand — from investors, industries, and entire nations — is now calling the shots.

And when physical silver is scarce, the spot price becomes irrelevant to those who need the metal now. They’ll pay what they must. That’s the environment we’re heading into — and fast.

Industrial Users Are Scrambling to Lock in Supply

If you thought silver was just a “poor man’s gold,” think again. Over 55% of global silver demand now comes from industrial uses — solar panels, EVs, electronics, and more.

And Baker gave us a glimpse into how panicked these sectors are becoming:

“Don’t be short silver.”

That’s what he’s been telling manufacturers. Why? Because the old “just-in-time” inventory models don’t work anymore when it comes to precious metals. If you don’t already have the silver, you’re going to pay through the nose — or go without.

He expects commercial inventories to rise across the board. “A step function higher,” as he put it. That means more ounces being hoarded by industry — and fewer available for the public.

The Supply Side Can’t Keep Up — Not Even Close

Here’s the reality: mine supply isn’t catching up anytime soon.

We’ve had five straight years of global silver deficits, and 2025 is shaping up to be yet another one — 100 to 200 million ounces short, Baker says.

This isn’t about geology. The silver is there — but getting it out of the ground is a bureaucratic and political nightmare. Environmental red tape, permitting delays, ESG pressure — all of it is choking new supply.

“From discovery to production is not five to ten years. It’s ten to twenty years in today’s regulatory environment.”

So even if miners wanted to go full throttle, they couldn’t. Which means the only real supply left is already in vaults, safe deposit boxes, and coin tubes — like the ones many of you reading this are holding right now.

American Investors Are Quietly Cornering the Market

Baker made a point most folks are missing: U.S. investors have been quietly accumulating silver for years — especially through retirement accounts and depositories.

He estimates that Americans have bought 1.5 billion ounces in bars and coins over the past 15 years.

And here’s the kicker — they’re not selling.

“Now they’re adding to it and they’re continuously adding to it.”

Even when silver is passed down through estates, it’s not being liquidated like it used to be. Heirs are holding onto it. It’s become a generational asset — just like farmland or real estate used to be.

The Gold-Silver Ratio Signals a Major Catch-Up Rally

Gold has been grabbing headlines with new highs — and deservedly so. But silver tends to lag, then surge.

The gold-to-silver ratio is a critical metric in this environment. And Baker believes silver is poised to close that gap, saying:

“I think you’ll see silver continue to reduce that ratio as it outperforms gold.”

We’ve seen this movie before. Silver sleeps, then explodes. And when it does, it often moves faster and farther than gold in percentage terms.

Why This Should Matter to You Right Now

If you're sitting on silver — real, physical silver — this article should give you confidence. The rest of the world is catching up to what you already know: silver is real money, and it’s also a critical industrial metal.

But if you’re not holding any, now is not the time to wait. The window to buy before premiums spike again could be closing fast.

The game is changing. Central banks are buying gold. Industrial users are hoarding silver. India is buying like there’s no tomorrow. And the mines? They’re stuck in slow gear.

Frank’s Final Thoughts

We’ve entered a new phase: physical is king. The spot price doesn’t matter when you can’t find product. The futures market can’t deliver what isn’t there. And the government? They’re too busy printing digital money and pushing FedNow to care.

Protect yourself while you still can. If the physical silver squeeze continues — and everything points to the fact that it will — the opportunity to buy cheap and plentiful could become a story we tell our grandkids.

Don’t wait for headlines that say “Shortages Hit U.S. Retail Silver Market.” By then, it’s too late.

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