Worldwide Silver Shortage Pushes Premiums to 40% on Silver Eagles [goldstockbull]

COMEX silver prices once again dipped below $23 today. My previous article entitled Ignore COMEX Pricing – Silver Eagles Sold Out at Dealers, $33 on Ebay detailed just how divorced from reality the COMEX price has become. So with another dip today, I decided to try to get my hands on some more silver coins. I realized before I picked up the phone that it would be difficult, but I have a few dealers in Colorado and California that have consistently been able to find supply at reasonable premiums.

Not anymore. The first phone call that I made was to one of the largest bullion dealers in Southern California, where I have bought a good deal of my physical gold and silver over the past decade. In fact, I had just bought several rolls of silver eagle coins from them last month at around $2.65 over spot price per ounce. I also purchased some for a family member back in January and paid the same premium.

In the past when some analysts were talking about a supply shortage and rising premiums, I was always able to find supply from this particular shop with a reasonable premium that was never more than 10% over the spot price. But today I was told that I could only order for future delivery at some point in late May or June and that the premium was $5 over the spot price.

In just the past few weeks the premium has nearly DOUBLED, despite the silver price dropping sharply and investor sentiment supposedly at multi-year lows. The manager of the shop told me the silver shortage was worldwide and it was more difficult than ever to secure supply and keep up with demand.

 

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Physical Gold & Silver Shortages Are Accelerating PREMIUMS EXPLODING

Gold and Silver shortages are increasing. However the current spot for paper silver is around $23USD. However, PREMIUMS are at $10 or higher per coin.

The paper market price and the physical price are starting to decouple. This is going to be fun to watch.

Hang onto your physical if you have any as this circus is just getting started. These are ebay links. My coin shop in my town does not have any of these coins available at the moment.

Couple links….

http://www.ebay.com/itm/2013-1-Oz-Silver-American-Eagle-1-Coin-SKU27334-/130877240044?pt=Bullion_US&hash=item1e78e432ec

http://www.ebay.com/itm/2011-Canada-5-Maple-Leaf-1oz-9999-Fine-Silver-Coin-UNC-/330906492012?pt=Bullion_US&hash=item4d0b905c6c

 

Article: Why the Western Banking Cartel’s Gold and Silver Price Slam Will Backfire – And How You Can Protect Yourself from the Blowback
“…
For all intents and purposes, the spot price is equivalent to the fake banker engineered price that cavorts across the ticker on your television everyday. But go to a dealer and try to buy at that ticker price and you will discover that it is a delusional fake price that no dealer is willing to kindly grant you. Instead, when I checked prices on 1-troy ounce American Eagle coins on Apmex last week, there was a 5.8% premium on gold coins and when the spot silver price had fallen to $22.99 an ounce earlier in Asia last week, Apmex was still listing their 1-oz American Eagles at $29.01, a whopping 26.2% higher than the spot price. Only a complete buffoon of economics, like Paul Krugman and his zombie followers, would ever believe that the price of real silver was $22.99 at any point and time last week.”

http://www.zerohedge.com/contributed/2013-04-22/why-western-banking-cartel%E2%80%99s-gold-and-silver-price-slam-will-backfire-and-how

Precious metals CEO: Physical silver market is “ugly”

“Last week, we turned away business in excess of 100,000 ounces because of stock depletion…”

By now, everyone has speculated on what caused the great precious waterfall which started on April 12 and continued for the next four days.

 
Read more at http://investmentwatchblog.com/physical-gold-silver-shortages-are-accelerating-premiums-exploding/#5D6BJe2GB081al8k.99

US Mint Sells Most Coins Ever In First 4 Months [goldsilverworlds]

The buying frenzy in the physical market continues. One of the leading indicators, at least for retail and part of wholesale investors, is the US Mint. We have been reporting updates on a regular basis: Q1 2013 US Silver Eagle Sales Beats All Records , US Mint Sold Exceptionally High In January & February and in other articles.

Time for another update. While April has not been completed, with a bit more than a week to go, the sales reports again beat all previous years. We have created the following overview which shows the sales of the US Mint gold and silver coins year-to-date (except for 2013 which is not complete).

US mint april2013 gold silver general

 

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The Truth Rises – Coordinated Strikes Work Both Ways – May 1st 2013

Silver Update 4/16/13 Force Majeure

RCM Rationing 2013 Silver Maple Leaf Bullion Coins [coinupdate]

Amidst a surge in demand, the Royal Canadian Mint has started rationing 2013 Silver Maple Leaf bullion coins at the primary distributor level. This follows the news earlier this month that the United States Mint had temporarily sold out of their 2013-dated silver bullion coins after receiving orders for more than 6 million coins and would begin rationing supplies as soon as sales resume.

Less information is known about the silver bullion coin situation in Canada, as the RCM does not publicly report sales levels outside of their required financial filings. A representative for the Mint did confirm that coins are currently being allocated.

Alex Reeves, Senior Manager of Communications at the Royal Canadian Mint provided the following statement:

Due to very high demand for SML coins, we are carefully managing supply to ensure all our distributors are served and we continue to take orders.  We do not disclose details of any customer transaction and specific 2013 numbers will be made available at our regular reporting intervals later in the year.

 

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US Mint Out Of Silver Coins – Suspends Sales [zerohedge]

As we noted earlier this month, the demand for both gold and silver ‘physical’ coins has been record-breaking as 2013 began. So much so, that now after selling over 6 million silver coins in 2013 so far, the US Mint has run out of silver eagles and has suspended sales. Furthermore, the Mint is saying that it will not restart sales until January 28th! With all asunder proclaiming victory and crisis averted based on the nominal price of stocks at five-year highs, Swiss interest rates no longer negative, and Spanish bond yields at 5%, it seems there are still a few that demand the wealth-preserving safe-haven of hard assets as the escalation of the currency wars shows no sign of abating.

 

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December 2012 American Eagle Silver Coin Sales 3rd Highest in History [mineweb]

he U.S. Mint reported annual American Eagle gold bullion sales dropped in 2012 from 1 million ounces in 2011 to 753,000 ounces last year.

However, December 2012 gold sales increased to 76,000 ounces, up from 65,500 ounces in December 2011.

Annual sales of American Eagle silver bullion coins totaled 33,742,500 ounces in 2012, down substantially from the sales of 39,868,500 ounces in silver bullion coins reported by the Mint in 2011. Nevertheless, December 2012 American Eagle silver bullion sales were the third highest in the Silver Eagle’s history.

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Gold and Silver Updated [silverseek]

Yesterday I made a post with the provocative title Silver is in a Bear Flag in response to some bullish headlines and well… silver’s Bear Flag, which remains intact and viable by daily chart.

A favorable bigger picture risk vs. reward situation was also highlighted for gold and silver in that post. Among the reasons for this:

  • Technical upside potential appears greater than downside.
  • The inflation-dampening Operation Twist is now put in the rear view mirror in favor of good old fashioned T bond and MBS Monetization.
  • The Commitments of Traders structures are improving.
  • Sentiment – especially among gold newsletter writers tracked by Mark Hulbert – is in the dumps and contrarian bullish.

 

Importantly, there is also the value proposition of gold, which has not changed throughout the long and bullish consolidation these last 1.5 years. By the graph below, courtesy of the St. Louis Fed, it has not changed since the beginning of the secular bull market either.

Here we have the gold price adjusted by the Monetary Base, which is the key money supply measure to be watching (as opposed to M2, MZM or their velocity measures) for signs of inflation.

gold and base

 

 

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Report that Russia Has Issued Gold and Silver Coins Which Can Be Used As Legal Tender [jessescrossroadscafe]

Unfortunately I do not read Russian so I have not yet completely verified this, but I thought it was interesting enough to pass along on the face of it, since it is ‘making the rounds’ of the internet, and some have asked me about it.

Here is the reported document in Russian.

As they are not coins for general circulation but rather coins to commemorate the Russian Olympics I do not see this as signficant perhaps as the blogger quoted below. Also it appears that they will be issued in rather limited numbers so will probably price as a collectible and not as currency. That is how it is with commemoratives in limited edition.

Here is the sentence from the document that provoked such a strong reaction in some circles.

“The coins are legal tender cash payment in the Russian Federation and must be accepted at face value in all kinds of payments without any restrictions.”

I have not yet done all the math to determine the equivalent ‘face value’ of the coins in other currencies, but I have taken an initial swipe at it.

In the case of the 50 Rouble gold coin, it is 7.78 grams, or 0.25013 troy oz.

At $1700 per ounce, that would make the gold coin worth about .999 x .25013 = .25 ounce of gold, or roughly $425 for a face value coin of 50 roubles.

That is about 8.5 dollars to the rouble. And I don’t think many would take that exchange, since the US dollar is now trading at about 30.77 roubles.

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Sale of gold coins and silver suspended in Argentina [bancadeoro]

The Central Bank of Argentina (BCRA) has suspended the sale of commemorative coins of gold and silver to the public “because of the high prices of these metals in the world market.”

The siege of the gold sales in Argentina and not only affects investment gold but now also affects sale of commemorative coins.
Spokesmen for the Central Bank of Argentina said that one factor of the suspension of sales was a “seasonal issue by metal prices,” and said they have halted the sale of collector’s items “because the amount remaining is very little and a portion of the edits must be kept to have stock “.
Argentina prohibits its citizens to buy dollars and gold
Some traders feel that this is a restriction similar to the dollar. The snare the dollar seems also extends to the commemorative coins in gold and silver. From a list of 33 commemorative coins existing gold and silver, are sold only three silver, being the twentieth anniversary of the death of Jorge Luis Borges, the Gesta of Malvinas and the World Cup in South Africa.
In some banks in Buenos Aires in the window with gold coins as investment gold Argentino, the Krugerrand or Dollar, said they are only on display, but can not sell.
Asked about the new restrictions on the sale of gold, one of the bankers merely stated that the stocks after the dollar, with the official measures that restricted the purchase and sale of U.S. currency, has now banned the sale of gold. Neither banks nor require employees BCRA know how long the suspension will last.

The Central Bank of Argentina (BCRA) has suspended the sale of commemorative coins of gold and silver to the public “because of the high prices of these metals in the world market.”

The siege of the gold sales in Argentina and not only affects investment gold but now also affects sale of commemorative coins.

Spokesmen for the Central Bank of Argentina said that one factor of the suspension of sales was a “seasonal issue by metal prices,” and said they have halted the sale of collector’s items “because the amount remaining is very little and a portion of the edits must be kept to have stock “.

Argentina prohibits its citizens to buy dollars and gold

Some traders feel that this is a restriction similar to the dollar. The snare the dollar seems also extends to the commemorative coins in gold and silver. From a list of 33 commemorative coins existing gold and silver, are sold only three silver, being the twentieth anniversary of the death of Jorge Luis Borges, the Gesta of Malvinas and the World Cup in South Africa.

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China’s Major Role in Silver Explained [silverinvestingnews]

The structure of the silver industry in China is almost unrecognizable from the situation 20 years ago, a new reportfrom Thomson Reuters GFMS states. In 1990, China was a relatively small player in silver. Now, the nation is responsible for 17 percent of global demand and produces 14 percent of the world’s silver. GFMS’ latest research reveals that China’s expanding role in the silver market has been driven by the liberalization of its silver industry and over a decade of economic growth.

After the revolution in 1949, gold and silver mining did not feature in the People’s Republic’s economic planning, GFMS explains. Investment in the industry was limited and private trading and personal ownership of the metals was forbidden.

China’s low level of silver production in the early 1980s raised concerns among State Council members, who decided that local production needed to expand in order to support industrialization and move the country toward self-sufficiency.

In 1983, regulations that covered the various aspects of the silver and gold industries, from production to export, were rolled out. The People’s Bank of China (PBOC) was granted monopolistic authority to set prices and buy and sell silver.

That initiated the rise of China’s silver production, which resulted in China becoming a surplus producer by the end of the 1980s. Production surpluses continued in the 1990s, and by 1997, the PBOC realized state stocks were more than sufficient for China’s fabrication needs.

Authorities eventually came to see silver as a metal with which to test deregulation. Exploratory sales from state stocks began in 1998. In 2000, an official trading platform was designated and China’s monopoly on silver ended.

China’s silver supply

China is now the third-largest producer of silver after Peru and Mexico.

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GATA’s Bill Murphy & Chris Powell call out Gold and Silver Market Manipulation Conspiracy Critics

Striking similarity between the chart of $Silver and Bitcoin

silverBitcoin

The Chart That Keeps Ben Bernanke Up At Night [Zerohedge]

What changed in the last 30 days? Did the world just wake up to the idea that the only way out of this quagmire is a twisted currency war that appears to have re-ignited thanks to Abe’s efforts? Something appears to have snapped in the American psyche as the last 30 days have seen the largest physical gold sales on record.

 

 

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Gold Price Manipulation Proven On The Intraday Charts [goldsilverworlds]

GoldSilverWorlds had the honour to do a Q&A with Dimitri Speck who is the author of the best-selling book “Geheime Goldpolitik”. He is chief financial engineer of Staedel Hanseatic and runsSeasonalCharts.com, offering a wealth of intraday trend charts. He is also one of the people who increased the pressure to create transparency in the German’s gold holdings.

A lot has been written lately about the gold price manipulation and the real amounts of gold reserves of the central banks. There are several views on the same topic, the most rational one being purely statistical. As it’s easy to get caught by emotions, we have chosen in this article to let the figures and the charts tell the story.

As a seasoned mathematician, Dimitri Speck is focused on what the charts are revealing. He looks both into intraday charts as well as seasonal charts, the former being one specific variant of the latter. Based on years of chart analysis, he could clearly pinpoint the manipulation in the gold market. In his book, he explores the subject of gold holdings of the central banks, in particular the Bundesbank. Interestingly, there is a link between all the different topics we just mentioned, which was the topic of our Q&A.

Transparency in Germany’s gold reserves

Dimitri Speck observes that the Bundesbank (German central bank) has to audit the German gold reserves on a regular basis and publish the results. That’s an obligation by German law. It needs to include in their reports for example if the gold has been leased out or if it’s physically there.

The point is that nobody has paid attention to these audits for a long time. A couple of years ago several authors started to question why the Bundesbank didn’t publish the results of their audits. Dimitri Speck was one of them. The question did escalate to some members of the Parliament. In Germany in particular, there is a Court of Auditors that picked up the topic two years ago (i.e. “RechnungsHof”, a special office which controls the public finances). The pressure increased and resulted in a promise by the Bundesbank to provide an answer “soon”. Their answer finally came in October. That’s the background of the whole “affair” that was created in October on Germany’s gold holdings.

Gold price suppression proven by intraday charts

Based on his statistical research, Dimitri Speck concludes that central banks started to influence systematically the price of gold as of August 1993. His conclusion comes in particular from his intraday statistics, where he observed several anomalies. First, since 1993, the price has been falling systematically during the trading session of COMEX in NY. Another trading anomaly is that during the PM fix the price systematically tends to drop significantly.

The following chart is the result of some 16 years of recording intraday data. The sudden price drops are so sharp and systematic, that it can only point to intervention.

gold intraday average 1993 2009 gold silver insights

 

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Should Student Debtors Buy Silver? [SilverVigilante]

student-debt

Nearly 1 and 5 households carry student debt.  Pew Research from earlier in the quarter showed that 22.4 million households, or 19 percent, held college debt in 2010, doubling the 1989 amount, and increasing 15 percent since 2007. That means the biggest three-year increase in student debt in more than two decades.  Any of those student debtor households buying either gold and/or silver per a “defensive financial portfolio” aimed at lessening the hazard of “personal economic warfare” would be much better off than one whose portfolio did not even maintain purchasing power.

Let’s say that the average student loan interest rate is about 8%.  The official average student debt rate is about $26,000, but let’s assume for our thought experiment the real one is like, say, $40,000.  Silver, since its price in 2002 of about $5 (not even), has risen in value well above 500%, meaning at least 50% gains each year.  One who has maintained a bank account, to be conservative, has gained, let’s say, 1.5% on their deposits, while monthly inflation in 2012 sat officially between 2-3%. That means a 2002 college graduate with, say, $10,000 saved in silver and $40,000 in student debt, could have -this decade- not only paid of their principal, but also had $28k left over, while one who had not invested in silver would have had to forgo a world of consumerism and impose self-austerity measures.

That is, in 2002, when 1,000 ounces only cost $5,000, our thought experiment subject could have purchased 2,000 ounces of the devil’s metal.

 

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Silver Demand Rolls On [silver-coin-investor]

Industrial Demand

Unlike gold, silver is an industrial commodity. The basic scientific properties of silver make it a candidate for use in an ever-growing variety of devices and applications, from computer chips to solar power generators.

Because silver is an industrial commodity, it is a candidate for an industrial shortage. The world’s industrial consumers hold little in the way of silver inventories, thanks to just-in-time inventory and production practices.

As we’ve discussed elsewhere on this site, 70% of silver production comes as a byproduct to other types of mining, such as copper, lead and zinc. The mining industry is simply incapable of keeping up with the current demand for silver.

[silver demand]

 

Given that we already have a widespread retail silver shortage, a wholesale shortage is likely as well. When industrial users face delays in silver shipments they will panic and attempt to build inventories all at once. This situation unique to silver—it does not apply to gold.

In the current financial crisis, there is a profound and very powerful advantage to silver being an industrial commodity. The mainstream has forgotten about silver as a monetary metal. The new generation, and possibly even you, has only a fleeting association between silver and value.

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New Silver Trading Platform Planned in Hong Kong [silverinvestingnews]

The Chinese Gold & Silver Exchange Society (CGSE) foresees a bright future for silver in Hong Kong and is making moves to play a bigger role in that future. Last week, the CGSE hosted its first Annual CGSE International (Silver) Conference, at which President Haywood Cheung spoke about the Loco Hong Kong Silver Contract, a new trading platform that the society plans to launch in the first quarter of 2013.

The CGSE is a metals market participant whose history dates back to 1910. A Reuters article notes that in addition to playing a major role in Hong Kong’s gold market, the society “currently offers electronic trading for Loco London gold and silver, which are denominated in U.S. dollars, and the Renminbi kilobar gold.”

New Silver Trading Platform Planned in Hong Kong

 

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Obama Bullish for Silver? [silverinvestingnews]

Obama Bullish for Silver?November 6, a day that created much uncertainty, has come and gone. Americans went to the polls and re-elected President Barack Obama for another term. But the nation’s leader is not the only thing that has remained unchanged — investors are still asking what will happen to silver and why.

The close race for the US presidency clearly reveals that not everyone supports Obama as America’s leader. However, it is widely believed that he is the best choice for silver investors.

One of the only true things that Obama said during his campaign was that he inherited a lousy economy, according to Peter Schiff, CEO of Euro Pacific Precious Metals.

“If Obama thought the economy he inherited was lousy, wait until you see how lousy the economy is going to be that Obama’s successor inherits … it is going to be much worse,” Schiff said in a post-election video blog.

Schiff predicts that a crisis will erupt in the US before the end of the president’s second term and said he foresees inflation wiping out those with wealth and dollar investments. He urged people to position themselves now for that event by purchasing gold and silver.

Inflation is one of the primary reasons an Obama re-election is considered bullish for silver.

With the Obama administration comes a Bernanke-led Federal Reserve. With the reins of the US economy held by two leaders who are widely considered reckless in their handling of money, many believe the next four years will hold wild spending and borrowing coupled with large-scale money manufacturing.

Remember that QE3 was the most anticipated market event of the year. Each round of this type of monetary policy, including the latest, has, to the delight of investors, driven up silver prices. However, for some silver investors what is more important is that the longer quantitative easing is underway, the more expectations of inflation will build and the closer many will perceive the demise of the US dollar to be. That is an event that is expected to be even more bullish for silver.

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Silver prices may climb as much as 38% in 2013 – GFMS

HONG KONG (REUTERS) -

Silver prices may rise as much as 38 percent in 2013 from current levels, as a weak global economy spurs safe-haven demand for the precious metal, the global head of metals analytics at GFMS, a Thomson Reuters unit, said on Wednesday.

Spot silver has gained more than 17 percent so far this year, outstripping a rise of 10 percent in gold, and setting course for its third yearly rise in four. Silver was trading at around $32.50 per ounce by 1020 GMT.

“Strong investment demand, higher gold prices on the back of monetary easing, rising inflation expectations and the persistence of ultra-low interest rates,” are among the factors that will lure buyers to the safety of silver, Philip Klapwijk, said on the sidelines of a conference in Hong Kong.

“We are thinking prices will trend higher next year. I’m not convinced that we are going to $50. I think we will definitely see $40 to $45 prices.”

Evidence of strong investment demand is shown by an increase of 4.5 percent this year in holdings on the largest silver-backed ETF, New York’s iShares Silver Trust.

Klapwijk also noted a limited growth in jewellery demand, particularly in the emerging markets.

 

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Silver Manipulation Explained In A Simple Way By Ted Butler [goldsilverworlds]

The month of October marked the highest amount of Silver Eagles sales over the past five years. One could ask why the price of silver was coming down from its peak early October. Of course part of the answer lies in the fact that Silver Eagles are not the only form of silver bullion. But there have been numerous examples in the past where the demand for physical silver was increasing while its price was decreasing, as described by Jeff Nielson amongst many others.

The point is that the traditional law of demand and supply don’t always work especially not in the silver market. The central points is this: the price of silver is mainly determined in the futures market. That’s a totally different story than how the mainstream media is reporting it. The typical explanations we hear in the media: a worse than expected unemployment report caused a flight to gold and silver as safe havens, or better than expected GDP figures caused investors to get out of precious metals. The truth is different.

Now one of the true experts in this matter is Ted Butler. He is not only respected because he is in the precious metals markets for more than three decades but also because of his tremendous inside knowledge. His analysis goes to the heart of the price setting: the Commitment Of Traders reports. Based on years of in-depth analysis, he came to the conclusion that the price of silver is manipulated and he is best positioned to explain himself why and how this manipulation happens. Although he believes that the manipulation has a strong short term effect, he is convinced that the longer term price is controlled by the increasing demand for physical silver. So yes the future looks bright, although there is uncertainty in the very short term price setting.

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Understanding Gold And Silver Prices [silver-coin-investor]

Understanding gold and silver prices is the key to unlocking the mystery of fiat money.

Gold and silver have a 6000 year history for their use as a currency, and until the last century, the price of gold and silver maintained a healthy valuation ratio of 1 ounce of gold to every 15 ounces of silver. This purchasing power ratio is strengthened by the fact that there are 17 ounces of silver for every 1 ounce of gold in the earth’s crust, although physical silver stocks have dwindled, as the metal is used in a wide variety of industrial applications.

Gold And Silver Prices: Historic Purchasing Power

It has long been said that an ounce of gold will buy a custom tailored man’s suit. In the 1930s, an ounce of gold cost $35, and a suit was nearly the same price. When you look at gold prices today, gold trades for $1150 and a custom suit does as well. Even thousands of years ago, the best clothing cost one ounce of gold, or 15 ounces of silver. Gold and silver prices are intrinsically tied together; however, manipulation in the price has made silver trade at an artificially low ratio to gold.

 

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GERMAN CALLS FOR GOLD REPATRIATION INTENSIFY AS FED REFUSES TO ALLOW INSPECTION [SilverDoctors]

Calls for Germany to repatriate its 1,536 tons of gold reserves held at the NY Fed are intensifying as Der Spiegel reports the Federal Reserve has refused to allow German inspectors to even view the country’s massive gold reserves “in the interest of security and of the control process“.

We have stated repeatedly that with repatriation and/or audit requests completed or in progress by Venezuela, Germany, Switzerland, and the Netherlands, The BOE and the Fed suddenly find themselves in a heap of trouble as the situation (and confidence that the Central banks actually still hold the tungsten gold reserves on deposit) is rapidly deteriorating. 
More on the Fed’s non-compliance with German requests to view/inspect their own gold below.

 

Der Spiegel reports that nearly half of Germany’s entire gold reserves are still held (supposedly) 5 floors below the NY Fed:

The Federal Reserve Bank of New York continues to hold 1,536 metric tons of German gold — or nearly half of Berlin’s reserves. This enormous hoard of gold is stored in the fifth subfloor of the bank’s building on Liberty Street, 25 meters (80 feet) below street level, and 15 meters below sea level. According to the bank’s website, the vault rests on the bedrock of Manhattan Island.

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David Morgan chats about manipulation in the silver market (Industry Watch)

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