Hydrogen peroxide and silver really do react that way. The hydrogen peroxide has to be extremely concentrated for it to work -- around 90 percent, compared to drug store hydrogen peroxide that is sold at a concentration of 3 percent. If you have a 90-percent concentration like that, hydrogen peroxide makes a great rocket propellant!
Hydrogen peroxide's chemical formula is H2O2. When it comes into contact with silver, the silver acts as a catalyst. The reaction frees the extra oxygen atom to produce water, and also generates a lot of heat. The heat turns the water into steam, which the engine can eject at a very high speed through a rocket nozzle.
Used in this way, hydrogen peroxide is a monopropellant. Compared to a normal rocket engine that burns two different chemicals (a fuel and an oxidizer), a hydrogen-peroxide engine is very cool and relatively safe. It is also very easy to throttle.
Here are some interesting links: