Hong Hao published a paid article today at 2.1, discussing his views on the recent sharp decline in gold and silver prices. I paid 299 yuan to read it, and here is a summary for everyone:

1. Cause of the plunge: A liquidity crisis triggered by high leverage margin calls, not an intrinsic collapse of gold and silver value. The core reason is the adjustment of CME margin rules, which triggered large-scale stop-losses and margin calls, causing asset prices to "instantaneously" drop. This is a short-term pricing distortion, consistent with the logic of the March 2020 "cash frenzy" market, and not a structural bear market like in 1980 or 2013.
2. Long-term support remains solid: Geopolitical conflicts, the US $40 trillion debt pressure, the global de-dollarization trend, continuous central bank gold purchases (over 1,000 tons in 2024), and the rigid industrial demand for silver driven by domestic new energy strategies—all core factors remain unchanged. Long-term buyers (central banks, emerging markets) are not sensitive to short-term price fluctuations, forming a solid bottom.
3. Market characterization: This sharp decline is a phase of deleveraging and cleansing within the long-term bull market of gold and silver. It is a healthy technical correction, not the end of the bull market. Once leverage returns to reasonable levels, prices will re-anchor to fundamentals. The short-term undervaluation after the correction provides a window for long-term investors to position, and the long-term bull market trend continues.
What do you think?