Veteran precious metals analyst Ed Steer has issued a stark warning about the current state of the gold and silver markets, claiming that recent price drops are not driven by natural market forces but by deliberate actions from powerful financial institutions. Speaking in an in-depth interview on CapitalCosm, Steer argued that bullion banks and large investment houses are actively working to suppress prices to protect their short positions.
“We’ve been smashed to the downside two or three times just in the last six weeks,” said Steer, a long-time observer of the bullion markets. According to him, a handful of institutional players are manipulating prices on the Comex futures exchange to maintain control and minimize excitement among retail investors.
Short Sellers in Control?
Steer explained that a small group of eight major traders—primarily bullion banks—hold large short positions that allow them to exert disproportionate control over pricing. “You’ve got eight traders against thousands of others who are net long gold and silver,” he said. “They’re trying to keep the price down and excitement out of the market so they can cover those shorts.”
Despite this paper market pressure, Steer pointed to a surge in physical gold and silver demand as evidence of a disconnect between futures pricing and underlying market fundamentals. He noted significant gold outflows from Comex depositories and a “monstrous” inflow of silver, much of which is not being reallocated—suggesting strong, sustained demand.
Unprecedented Deliveries in May
One of the most telling signs of stress in the system, Steer claims, is the volume of gold being delivered. “In just two days, 5,500 gold contracts were delivered—millions of ounces,” he noted, describing the activity as “unprecedented.” This surge in physical delivery requests stands in contrast to falling futures prices, further supporting his case that market dynamics are being artificially influenced.
A Message to Investors
Steer acknowledged that falling prices can shake investor confidence, especially for retail buyers—or “stackers”—accumulating gold and silver for the long term. But he emphasized that seasoned investors often view declines as buying opportunities. “The best time to buy an asset is when blood is running in the streets,” he said, urging investors to take a long-term view and maintain steady accumulation strategies.
Looking Ahead
According to Steer, the current situation is unsustainable. He believes that once the bullion banks ease their short-selling activities, gold and silver prices could spike dramatically. “They’re the cork in the bottle,” he warned. “If they put their hands in their pockets, even for 24 hours, we’d see prices you frankly can’t believe.”
Steer’s analysis underscores ongoing concerns in the precious metals community regarding transparency and fairness in the futures markets. While regulators have occasionally probed price manipulation in the past, many retail investors and analysts like Steer remain skeptical that sufficient oversight is being applied.
For now, Steer recommends staying informed and strategically accumulating physical metals. “There’s a disconnect between the price and the reality of demand,” he concluded. “When that gap closes, it’s going to be explosive.”
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