JPMorgan recently took delivery of more than 12 million ounces of physical silver from COMEX in a single month. Physical silver means real metal bars moved out of a vault. It is not a paper promise or a trading contract. This kind of move matters because the same bank has paid major fines in the past for unfair actions in silver trading. So when it starts building a large physical position, it is worth paying attention.
One reason investors watch this is a growing risk in the financial system: the private credit market. Private credit is lending that happens outside normal banks. It is often done by private funds. These funds lend to companies that may not qualify for safer bank loans. Supporters say it helps businesses get money. The risk is that it can grow fast with less clear reporting.
This market has expanded to around $3 trillion. Some warnings suggest default rates could rise. A default happens when a borrower cannot pay interest or repay the loan. Another term sometimes used is payment-in-kind (PIK). PIK means the borrower does not pay interest in cash. Instead, the interest gets added to the loan balance. The debt grows even when the borrower is already struggling. This can hide trouble for a while.
In times of stress, many institutions prefer assets with less “middleman” risk. That is where the idea of paper silver vs physical silver comes in. Paper silver includes futures contracts and some funds that track silver prices. These can depend on many parties working properly. Physical silver is simpler. If it is owned and stored safely, it does not rely on a fund manager or a custodian to keep its value.
Silver is also not only a “precious metal.” It is an industrial metal used in electronics. It is known for very high electrical conductivity, which means electricity moves through it very well. That matters for things like solar panels, electric vehicles, and data centers.
The big picture is not a guarantee of what will happen next. But Felix Prehn’s educational work through Goat Academy often focuses on reading institutional signals and understanding system risks in plain terms. Readers who want background on his approach can start here: About Felix Prehn and Goat Academy.