Archive for the ‘Your Silver Lining’ Category

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

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 …

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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.]

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.

“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.

Silver Chart

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. “

Perth Mint ... awfully-pretty building ... wonder if anything is in it? ... quick youtube video walk-through ought to answer that.

” If The Perth Mint is storing your metal, they admit that they may have loaned your metal out to AGR Matthey. … ‘The $880 million of precious metals deposited by Perth Mint Depository clients (note 17) was used in operations by Gold Corporation as inventory ($381 million – Note 8b) with the balance in the refining operations of AGR Matthey (Note 8a). … AGR Matthey has well established relationships with the major bullion banks and regularly supplies to them on a contractual basis.’ “

My 2-Bits: If your local grocer told you that your next order of groceries would be “delayed” by eight weeks, wouldn’t you call that a food shortage? “Delay” isn’t the first world that pops up in my mind when a company can’t deliver its main product immediately. Perhaps “Production Delay” is an Australian term which, loosely translated into American, means “Tough Luck, Buddy!” It appears these folks have loaned out a massive amount of silver to AGR Matthey (approximately 33 million ounces of silver, I’m estimating, or $500 million in today’s Aussie funny money based on the Jan 1/08 price of $15US/oz). When asked what would happen if AGR Matthey defaults? No worries, mate. Perth Mint folks assure us the Australian government (translation: Australian taxpayers) will happily pick up the tab.

Here’s a quick gander at how much your average Australian family will be pick-pocketed if AGR Matthey does an Enron-like ‘oopsy’:

  • Silver @ $18USD/oz: 33Moz = $600,000,000 owed, or about $112 per family (that’s the silver debt denominated is Austrlian dollars right now)
  • Silver @ $30USD/oz: 33Moz = $1,000,000,000 owed, or $200 per family
  • Silver @ $100USD/oz: 33Moz = $3,333,333,333 owed, or $470 per family

Of course a rising silver price only *increases* the likelihood of corporate default when the debt is payable only in silver metal. Awfully-generous folks, those Australian taxpayers, should the silver price hit the proverbial fan. When you consider after-tax income and average salaries, $470 after taxes is probably getting close to a week’s worth of work for your average hard-working Australian. So if silver goes to $100/oz and AGR Matthey defaults does that mean every Australian will be forced to serve a week’s worth of hard labour to make up for this potential boondoggle? What if silver goes even higher?

Whoda thunk the silver price dam might burst in the bone-dry Australian desert.

” The government rationed food during World War II and gasoline in the 1970s. Now, it’s imposing quotas on another precious commodity: 2008 dollar coins known as silver eagles. “
My 2-Bits: Wow! Those NY paperboys sure act on stories fast. (NOT!) I posted this story about a month ago.
” Let’s get a bit real here. If the total silver supply is roughly one billion ounces and we can measure NINETY times that amount being “traded” on the reporting exchanges, does it not beg the question why? “