eBay vs. CRIMEX: Will the Real Precious Metal Price Please Stand Up?

eBay Silver Maple Price Summary for Sunday, November 30, 2008

This screenshot is courtesy of the chaps and www.24hgold.com who I believe have performed a huge service to precious metal investors the world over with a fantastic new price discovery website that monitors eBay transactions for gold and silver coins and bars. The results in terms of the per ounce premium price disconnect (especially for Canadians) are astounding. As of this weekend (Sunday, Nov 30/2008) the per ounce price differentials are as follows:

• GOLD
• COMEX Spot: $817.83 US / $1013.14 CDN
• AVG. EBAY 1Oz Maple Leaf Price For Friday: $1263.81 CDN
• That’s a 25% Premium over Spot, or $250 CDN / Ounce !!

And the price differential of CRIMEX spot vs. eBay silver, especially Maples, is more than double…

• SILVER
• COMEX Spot: $10.31 US / $12.78 CDN
• AVG EBAY 1Oz Maple Leaf Price For Friday: $29.74 CDN
• That’s a 117% Premium Over Spot, or $16.96 CDN / Ounce !!!

The website does point out the difficulty is separating out shipping prices from eBay bids, so some shipping cost is probably worked into the eBay price. Also, prices for gold and silver bars are closer to the spot price, but still much, much higher.

I encourage you to check out this fantastic new service at: http://www.24hgold.com/english/buy_sell_silver_coins.aspx?co_id=2

Now if only some clever individual would start a banner charting service for this so we can rid ourselves of the ridiculous Kitco CRIMEX spot price spam graph …

Pregnant Pause On Air After the Elephant in the Room Speaketh

CNBC: Gold spike to “at least double the price [i.e. $1700/oz] in very, very short period”

Within the gold complex, there is a disparity between the paper market and the physical market, notes Jurg Kiener, CEO of Swiss Asia Capital. He tells CNBC’s Maura Fogarty & Rebecca Meehan that if the paper market collapses, gold prices may double very quickly.

http://www.cnbc.com/id/15840232?video=880574352

Partial Transcript:

MEEHAN: I’m kind of surprised at where gold is trading, however because even though we see gold as a safe haven status given all the volatility in the markets lately gold hasn’t really reacted as positively. Why not?

KIENER: I think the paper market has really traded as positively as one might expect. When I say the paper market of gold I talk about COMEX and LME. If you look at the physical market, the physical market has been on fire. It’s getting very hard to buy one-ounce coins or smaller bars. Most jewellery shops have been running out. You can try some of the major banks. So we have a supply problem in supplying the feed. So what you have right now is a two-tier market. A paper market on Wall Street where the bankers continue to gamble like everything else, and the real market where gold is red hot and people can’t get physical.

[DEAD AIR FOR ABOUT THREE SECONDS]

MEEHAN: It’s Rebecca in Europe here. So what does that mean? That trend in the physical market. What does that mean for the gold market in general. If the economic conditions continue to deteriorate or stay as they are what does that mean for the gold market in general?

KIENER: First of all the stability in the financial markets where governments are destabilizing the savers, basically the person in power of the money, and if you get interest rate reductions almost close to zero then owning gold can probably be the best thing you can have. That’s going to put pressure on the paper markets, the LME and COMEX, and what I would like to see is actually some of the paper contracts defaulting, like you had the CDOs and the CDSs and whatever else out there defaulting I think we are going to get very close to see an environment where you are going to see the paper contracts on precious metal defaulting, and with that you are going to get a massive price increase in the overall prices of precious metal.

FOGARTY: Okay, were at 863 right now for COMEX gold. We checked on spot earlier around the 860 level as well. If you expect to see a spike when we see the paper market break down, in other words, where would that spike lead us to?

KIENER: At least to double the price.

FOGARTY: In… within a short amount of time?

KIENER: Very, very short period. It will spike up quite fast. If you think we had an oil rally going from $65/70 to $140 in nine months. I think you can double in gold in basically a much shorter period because the market is much smaller.

[And where gold goes silver follows.]

Whisperings of a New Gold-Backed Global Currency From the BRIC Countries Could Decimate Both the U.S. Dollar and the Euro

With the BRIC (Brazil, Russia, India, China) economies in much stronger shape domestically compared to the sickly U.S. and their respective markets already pricing in much of the coming collapse yet to really hit the U.S. stocks I wonder when these countries will band together to form a new currency of their own? They may as well, since many global financial instruments already treat them as an economic unit (case in point).

And if these countries were to form a new global currency that’s 100% backed by gold (like the U.S. dollar was from 1792 to 1971) then I suspect we would witness a global stampede out of Euros and U.S. Federal Reserve Notes into this new golden currency backed by the strongest economies across the globe. Why not call the new currency a bric? In English, the name alludes to something concrete, sound, stable, and badly needed in these uncertain times. The gold-backing shouldn’t be B.S., though. Any Tom, Dick or Harry needs to know he can go to the bank with a Bric note and know he can walk out with gold.

From Brazil: Although its stock market is beaten up, its domestic economy is still very strong.
Brazil expects the odd sniffle, but nothing serious

• Brazil has not decoupled itself from the rest of the world: its stock market has fallen fairly much in line with other markets but, unlike in the past, the turmoil elsewhere has not been amplified.
• Brazil has been able to maintain foreign reserves in excess of $200bn to help it weather the storm.

From Russia: Now a major player in the world energy scene, Russia’s central bank has recently been stockpiling gold.
Time for a gold rouble?

• The decision by the US government to inject $700 billion into the financial system means that the already gigantic annual budget deficit of the American state (previously some $450 billion a year) will now rise by a factor of three. The total state debt of the USA will rise to well over $11 trillion. It is obvious that such a colossal debt can never be repaid.
• Russian leaders might also consider making their own currency, the rouble, convertible into gold.

From India: The World Gold Council says that Indian citizens possess the most personally-owned gold in the world. And that love for gold is now stronger than ever.
Indian customers lured by gold’s lower price

• UBS, one of the largest gold exporters to India, says it has seen a spike in sales. John Reade, UBS metals strategist, says that the near-absence of jewellery demand in India between August 2007 and July left the local market largely de-stocked, “hence the tremendous pickup in demand over the past five weeks.”

From China: Also big gold lovers, the Chinese government is now openly questioning the use of U.S. Dollars as the default world currency.
China paper urges new currency order after “financial tsunami”

• Threatened by a “financial tsunami,” the world must consider building a financial order no longer dependent on the United States, a leading Chinese state newspaper said on Wednesday.
• “The world urgently needs to create a diversified currency and financial system and fair and just financial order that is not dependent on the United States.”

China Gets Protectionist: Cuts Off Inter-bank Lending to U.S. Banks Only

South China Morning Post: China stops its banks from lending to U.S. banks

• Mainland regulators have told domestic banks to stop lending to United States financial institutions in the interbank market in a bid to prevent possible losses during the financial crisis, industry sources said yesterday.
• The ban from the China Banking Regulatory Commission (CBRC) applied to interbank lending of all currencies to US banks but not to banks from other countries, a source said.
• Mainland banks had US$9.8 billion in exposure to US subprime loans at the end of last year and US$25 billion to Fannie Mae and Freddie Mac by June 30.

Devil in the Details: ‘Sinister’ $700-Billion Bailout == ‘There Goes Your Country’

Congressman Ron Paul: Time is running out

Whenever a Great Bipartisan Consensus is announced, and a compliant media assures everyone that the wondrous actions of our wise leaders are being taken for our own good, you can know with absolute certainty that disaster is about to strike.

…

Then there’s this: “Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.“ Translation: the Secretary can buy up whatever junk debt he wants to, burden the American people with it, and be subject to no one in the process.

…

There goes your country.

Chance of Brain Cancer Up 500% For Children With Cellphones

London Daily Mail: Children who use mobile phones are ‘five times more likely to develop brain tumours’

• Professor Lennart Hardell, of the University Hospital in Orebro, Sweden, said: ‘People who started mobile phone use before the age of 20 had a more than five-fold increase in glioma.’
• This is a cancer of the glial cells which support the central nervous system. About half of all primary brain tumours are gliomas, according to Cancer Research.
• Professor Hardell said that home cordless phones were almost as risky as mobile phones, with youngsters using them four times as likely to develop glioma.
• Those who started using a mobile phone before the age of 20 also increased the risk by five times of getting an acoustic neuroma.
• These are benign tumours which do not cause cancer. Nevertheless, they can damage the auditory nerve and cause deafness.
• The researchers said that those who started using their mobiles in their 20s were 50 per cent more likely to contract glioma and twice as likely to get acoustic neuromas.
• Professor Hardell said: ‘This is a warning sign. It is very worrying. We should be taking precautions.’

Latest Gardasil Garbage

From Australia: Hundreds Get Sick From Gardasil Cancer Vaccine

“More than 17 girls a week have been experiencing adverse reactions such as seizures and numbness after taking cervical cancer vaccine Gardasil since it became widely distributed in April.”

From the US: Vaccine Safety Group Releases Gardasil Reaction Report

“If only 1 to 4 percent of all adverse events associated with Gardasil vaccination are being reported to VAERS, there could have been up to 38,000 health problems after GARDASIL vaccination in 2006 which were never reported.”

…and from this press release: Merck’s Gardasil Vaccine Not Proven Safe For Little Girls

“Merck and the FDA have not been completely honest with the people about the pre-licensure clinical trials,” said NVIC president Barbara Loe Fisher. “Merck’s pre and post-licensure marketing strategy has positioned mass use of this vaccine by pre-teens as a morality play in order to avoid talking about the flawed science they used to get it licensed. This is not just about teenagers having sex, it is also about whether Gardasil has been proven safe and effective for little girls.”

Just so you know, according to Wikipedia, in terms of prevention Gardasil’s claims of prevention only cover a small fraction of HPVs.

“130 HPV types have been identified. … About a dozen HPV types (including types 16, 18, 31 and 45) are called “high-risk” types because they can lead to cervical cancer.”

… and of these 12 high-risk cancers, Gardasil may only prevent two of them while the other 10 slip right on through (granted: those two are the most prevalent). Even drug-company Merck admits this:

“Gardasil is designed to prevent infection with HPV types 16, 18, 6, and 11.”

Here in Canada our sacred watchdog, the CBC, weighs in and decimates its credibility by doing Canadians a serious disservice after omitting almost all of the above in its latest propaganda piece.

“The catch with Gardasil, though, is that it has proved remarkably effective against two particular strains of HPV, which in themselves are said to be responsible for upwards of 70 per cent of cervical cancers. That means Gardasil will not prevent all cervical cancers and women are still advised to get Pap tests.”

“… are said to be responsible …” Love the use of passive voice, oh weasly writer. Proved by whom? Merck? (Oh please!) Do the math, oh lazy CBC reporter: 70% of 400 = 280 lives that might be saved versus the possibility of between 1,400 to 3,800 possible health problems as a result of the vaccination (extrapolated from the population-adjusted 17/week reported in Australia and 1/10th of NVIC’s claim of non-reported VAERS reactions). Many of these serious reactions involve death: 17 it appears in the U.S. so far and, if doctoral reluctance to report to VAERS is truly at 1/25th, as NVIC suspects, that fatality count may well be over 400. The next time CBC chooses to be a mouthpiece for Merck they may want to contact the odd differing viewpoint, like the folks at the National Vaccine Information Center. Completely disgusting, irresponsible journalism, CBC. IMO the article couldn’t be more yellow if it tried.

And if you’re planning to emigrate to the US, guess what? The U.S. Government is now making HPV Vaccinination mandatory for new US residents. This is just one more reason not to move there–why would anyone want to anyway?

Oh, and by the way, what’s the deal with over-30 chinese women and Gardasil? This blogpost does not bode well for chinese women living in southeast Asia:

“Gardasil Commercial seeking CHINESE Actress: CHINESE WOMEN / Female / Asian / 30-45 / MUST BE 100% Chinese / MUST BE OVER 30 and under 45 (ID’S WILL BE CHECKED AT AUDITION) … We are looking for more from the regions below. But all 100% chinese may send in picand contact info. 2. South Asia, 30 – 45, South Asian in appearance so would be accepted in several countries of region (Hong Kong, Malaysia, Philippines, Singapore, Thailand, Vietnam, Indonesia). Primary markets in the region are Singapore, Malaysia, & the Philippines.”

Is Merck now targetting chinese women abroad? I guess Gardasil’s marketing mercenaries (how do they sleep at night?) have decided that this demographic is insecure enough to be easy prey. On a positive note, North American girls appear to be getting wise to Merck’s marketing tactics (Yay!). According this Forbes article:

“Gardasil has been the blockbuster that wasn’t. While it logs a billion dollars in sales annually, even an expansion of uses on the label can’t make it the drug that Merck had hoped it would be.”

Meanwhile the list of side effects continues to lengthen (Gardasil Jab Linked to Pancreatitis – Australian Doctors Demand a Review) … and the victim tally mounts. I smell multiple class-action lawsuits in the works, and guess who will ultimately pay when Merck blames (and rightly so, I sadly admit) regulatory authorities like the FDA? Why that would be you, oh lucky taxpayer.

Money 101

Since we will all spend most of our lives trying to earn money it behooves us to actually know what money is. IMHO, absorbing the content of this video should be required for every man, woman and child on the globe. The time spent viewing this 45-minute video is well worth it.

65 dealers! All sold out of silver!

Jason Hommel has made available even more feedback from his readers from all over the world. In his latest missive he describes:

“Before I list them, there was one report in particular that I was looking for, and I apologize that I cannot share it with you now. It talked of a coin show of 65 dealers. Before the show, they were all trying to buy silver from each other, but nobody had any. The man who attended the show left without any silver. 65 dealers! All sold out of silver!”

Tom Jeffries at Howestreet.com quotes the owner of Border Gold in White Rock, Michael Levy, as saying “You cannot get a 100 ounce bar of silver anywhere in Canada to save your life.”

The mystery of a falling silver price in spite of massive global physical demand continues to flummox analysts. As this writer puts it The Law of Supply and Demand Is Dead for Gold and Silver.

Bottom line. If you haven’t already, then I suggest you get some silver if you can and gold if you can’t.

Finally, A New Pop Song I Can Relate To…

According to a Bank of Canada Working Paper Canada’s Next Housing Crash Should be Farther and Faster than the U.S.

For all those the-housing-market-is-different-here-in-Canada folks this one’s for you, courtesy of the Bank of Canada. BoC made this working paper entitled “Housing Market Cycles and Duration Dependence in the United States and Canada” available in February 2007 to very little fanfare. If this is old news to some then I’m sorry for wasting your time, but since I frequent many Canadian RE websites I see nary a mention of it, and its findings are IMHO quite pertinent. So here are some of the highlights (bolding and comments within square parentheses are mine):

From the abstract:

• Using a panel of 137 cities, we examine the duration, size, and correlations of housing market cycles in North America. [Although mostly secondary, the research does go back as far as 1870.]
• We find that North American housing cycles are long, averaging five years of expansion and four years of contraction, and there is a fairly high degree of correlation in house price cycles between U.S. and Canadian cities. [Ahem, to those few Canuck RE bulls still in denial out there, please take note -- NEWS FLASH! WE'RE NOT DIFFERENT.]
• … to the best of our knowledge, this is the only study that tests specifically for duration dependence in housing market cycles.

From the summary:

• Housing cycles in the U.S. and Canada are quite similar overall, but Canadian housing market cycles are more volatile than those in the U.S. Most notably, Canadian housing market contractions are somewhat shorter and sharper than those in U.S. cities. [Sharper, as in we Canadians will see bigger housing price drops than what we're seeing in the U.S. which, three years later, is still in freefall.]
• In both countries, real house prices decline by 10% to 11% during an average contraction. [So since average prices in the U.S. have so far dropped by 20% with no sign of stopping we are obviously entering an abnormal price decline. How abnormal? Just keeping watching the Case-Shiller's U.S. home price index to get an idea of the minimum drop we're going to see here in Canada.]
• This price decline however, occurs more rapidly in Canada since the average contraction lasts only 3.5 years in Canadian cities compared to 4.4 years in the U.S. cities. [This should be good news for those young Canadians smart enough keep building their nest eggs and not succumb to realtor wiles. Since most analysts put the current U.S. housing top in summer of 2005, Canada seems to be a little bit behind schedule with a spring 2008 top. The paper’s data seems to suggest a bottom in the U.S. around Christmas of 2010 and for Canadians the end of 2012. Remember however, this is based on an average correction and so far the housing bloodbath going on down south is anything but normal.)

In the interests of brevity I’ve only highlighted the abstract and summary. However for the avid RE blog reader there is plenty of interesting tidbits in the 40+ pages in between. All in all a really interesting study, and I would like to thank the folks and the BoC for doing the work. (Thanking a central bank–ugh!–but credit where credit is due.) The BOC link to the working paper is here . Enjoy!

UK Silver Bullion Buying Experience: “Ah, well. There’s a Physical Shortage, You See.”

[Money Week] Is the World Really Short of Silver?

“How much for that kilo bar?” I asked.

“£425,” came the reply.

“But the spot price for a kilo of silver is only £275,” I spluttered. The assistant dutifully called her boss. After a hushed conversation punctuated by furtive glances in my direction, she returned. “We can do it for £415,” she announced generously.

“But that’s 60% above the spot price.”

“Ah, well. There’s a physical shortage, you see.” But is there really? Are these reports I’ve been reading about a silver shortage really true?

I ended up going to all the other smiths on the island. The cheapest I was able to find was £355, 35% above the spot price (and, remember, there’s no Value Added Tax in Guernsey). When you’re buying small amounts like a kilo, you expect to pay a bit of a premium to spot, but even 35% seemed rather high.

Meanwhile the silver chart is starting to look very bullish with very strong support at around $16.50, where I have drawn the horizontal line. There might be some resistance as it hits the descending trend line, but there seem to be plenty of buyers at $16.50. “

Can Oklahoma Save the Republic? (Message to the White House: You Must Serve States — Not Vice Versa)

[World Net Daily] Oklahoma to feds: Don’t tread on me: State House defends its sovereignty from D.C. intrusion

“The State of Oklahoma hereby claims sovereignty under the Tenth Amendment to the Constitution of the United States over all powers not otherwise enumerated and granted to the federal government by the Constitution of the United States.” … The resolution resolves that Oklahoma will “serve as notice and demand to the federal government, as our agent, to cease and desist, effective immediately, mandates that are beyond the scope of these constitutionally delegated powers.”

My 2-Bits: If most of the states can pass (and enforce) similar resolutions, then the nazification of our southern neighbour will become a sad blemish in its past–but at least it will be history. I urge all Americans interested in protecting their liberties and restoring the Constitution to its full powers once again to demand their respective state legislatures pass and enforce the same legislation reaffirming the 10th Amendment.

Have The Japanese Finally Done It? A Car That Runs Exclusively on Water?

[Tech-On] New Fuel Cell System ‘Generates Electricity with Only Water, Air’

” With the new process, the cell needs only water and air, eliminating the need for a hydrogen reformer and high-pressure hydrogen tank. Moreover, the MEA requires no special catalysts, and the required amount of rare metals such as platinum is almost the same as that of existing systems, Genepax said. “

Food and Gas Riots Spread to Europe

[Raw Story] Two truck drivers die as fuel protests spread across Europe

” Two lorry drivers were killed on picket lines in Spain and Portugal on Tuesday as strikes by thousands of truckers over soaring fuel prices turned deadly. … Spanish police escorted petrol supply tankers into Barcelona on the second day of the stoppage that has caused food and fuel shortages and huge tailbacks on the Spanish-French border. … Tens of thousands of truckers are on strike or joining the protests to demand government help to offset the higher fuel costs.”

US Grain Emergency Reserves Down to a Loaf of Bread per Citizen?

National News: The U.S. Has No Remaining Grain Reserves

Friday, June 06, 2008 – 10:10 AM

AAM Concerned with CCC Inventories

WASHINGTON – Larry Matlack, President of the American Agriculture Movement (AAM), has raised concerns over the issue of U.S. grain reserves after it was announced that the sale of 18.37 million bushels of wheat from USDA’s Commodity Credit Corporation (CCC) Bill Emerson Humanitarian Trust.

According to the May 1, 2008 CCC inventory report there are only 24.1 million bushels of wheat in inventory, so after this sale there will be only 2.7 million bushels of wheat left the entire CCC inventory, warned Matlack. “Our concern is not that we are using the remainder of our strategic grain reserves for humanitarian relief. AAM fully supports the action and all humanitarian food relief. Our concern is that the U.S. has nothing else in our emergency food pantry. There is no cheese, no butter, no dry milk powder, no grains or anything else left in reserve. The only thing left in the entire CCC inventory will be 2.7 million bushels of wheat which is about enough wheat to make of a loaf of bread for each of the 300 million people in America.”

The CCC is a federal government-owned and operated entity that was created to stabilize, support, and protect farm income and prices. CCC is also supposed to maintain balanced and adequate supplies of agricultural commodities and aids in their orderly distribution.

“This lack of emergency preparedness is the fault of the 1996 farm bill which eliminated the government’s grain reserves as well as the Farmer Owned Reserve (FOR),” explained Matlack. “We had hoped to reinstate the FOR and a Strategic Energy Grain Reserve in the new farm bill, but the politics of food defeated our efforts. As farmers it is our calling and purpose in life to feed our families, our communities, our nation and a good part of the world, but we need better planning and coordination if we are to meet that purpose. AAM pledges to continue our work for better farm policy which includes an FOR and a Strategic Energy Grain Reserve.”

AAM’s support for the FOR program, which allows the grain to be stored on farms, is a key component to a safe grain reserve in that the supplies will be decentralized in the event of some unforeseen calamity which might befall the large grain storage terminals.

A Strategic Energy Grain Reserve is as crucial for the nation’s domestic energy needs as the Strategic Petroleum Reserve. AAM also supports full funding for the replenishment and expansion of Bill Emerson Humanitarian Trust.

The May 1, 2008 CCC Inventory report may be reviewed here: http://www.fsa.usda.gov/Internet/FSA_File/wid2a.pdf

My 2-Bits: I posted this article in its entirety since the Tristate Observer, where the original article was posted, appears to be down.