Recent Turmoil in the Gold and Silver Markets: Nearly $3 Trillion Wiped Off Gold and $760 Billion Off Silver in Just Hours

Many people are wondering how such an enormous amount of money suddenly “vanished” and where it went.

In reality, this money did not physically disappear. What actually happened was a sharp drop in market capitalization. This can be understood by looking at two different types of investment:

1) Physical Investment

For example, buying gold or silver from a shop and storing it at home.

In this case, when prices fall, the loss exists only on paper. As long as you don’t sell, you still own the same quantity of gold or silver. A real loss occurs only when you sell at a lower price.

2) Online / Forex / Derivatives Trading

Here, you do not own actual gold or silver. Instead, you hold a digital position, usually with leverage. When the market moves sharply, leverage multiplies losses.

During just a few hours (around 1–2 hours), the violent price swings caused many traders’ accounts to be completely wiped out or hit by severe margin calls.

Example:

If someone had a $1,000 account and was trading with high leverage—whether in a long or short position—the market “sweep” could eliminate their entire capital.

This is why experts repeatedly advise: If you want to invest in gold or silver, prefer physical ownership (coins, bars, or jewelry). In online forex/CFD trading, high leverage can wipe out your entire capital within minutes. Physical assets do not carry such instant and catastrophic risk.

An Interesting Point

If the amount of “money” collected by the forex/commodity market yesterday (i.e., the losses incurred by some traders) were to come to Pakistan, the country would instantly rank among the richest in the world. In reality, however, these losses and gains mostly shift between large institutions, hedge funds, and professional traders.

For ordinary people, the lesson is clear: markets can be extremely dangerous and unpredictable.

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