Many posts back, I mentioned that I usually only buy pm’s (precious metals) when I can get them at discount…usually at spot. So, here’s the interesting thing…I swing by my local PM guy the other day and silver is $107/oz. I ask him what he’s selling it at, in terms of premiums. Well, he’s selling silver, at that time, for $100/oz.
Waitasec…spot is $107 and youre selling it for $100? How…how do you do that?
Turns out the answer is…economics. My guy doesn’t want to get caught holding a bunch of metals in a market that is, to say the least, a bit volatile. He sells it to his wholesalers almost as soon as he gets it. Well, his wholesalers are buying it at $17 under spot. So his $107 ounce of sliver gets him…$90. So, he can either sell the silver for $90 an ounce to the wholesaler or he can sell it to someone like me who walks through the door for $100. Of course, he isn’t buying it at spot…he has to buy it below what his wholesalers will pay him. So he’s paying, for example, $18 under. Or, put another way, he can either sell his $82 ounce of silver for $83 to the wholesaler, or $100 to me. Well, would’n you sell it to the buyer who is paying more? So, he is selling silver at below spot and still making money.
In a perverse way, its kind of a good time to buy silver if you focus just on the ability to buy at or below spot.
He doesn’t think the run up in silver is done yet. Doesn’t matter to me , though… one of my goals at the moment is to start replenishing my silver hoard that I liquidated to finance the Beta Site.
Did a little phone research yesterday on the buy/sell spreads .
There are still dealers out there who will pay spot plus , you just have to wait until they have a box sold .
This is because those same wholesalers who are hedging their risk by paying 15 under , still want to sell to the dealers for spot plus .
The dealer also for years has been advising me to buy gold instead of silver . Yesterday he capitulated and commented we could see 150 by July .
I’ve been buying gold & silver well below the future contracts price for many years now for all the reasons that you outlined – especially 90%. The old “spot” price was just a random price determined by a group of banksters in London that no longer applies. Now that you have educated many in your audience on coin shop practices, better prices are out there if you just ask.
there’s a good sized cabal behind the precious metals $$$$ escalating >>> and they’ll be deciding to dump – it’ll be a massacre overnite – the market price will tumble 1,000X faster than it ever rose …..
making $$$ in little chews is the smart move ……
Dollar cost averaging is the way to go, methinks.
https://en.wikipedia.org/wiki/Dollar_cost_averaging
Maybe. OTOH demand has outstripped supply for several years now and the companies and nations that depend on silver (and other PM’s) to manufacture their products and weapons of war will continue to pay a higher price rather than suspend production. Bank of America and others are looking forward to a $300/oz price of silver.
This is not s normal pump and dump but a monetary revaluation. Physical is needed for a multitude of industrial uses ( 40,000+) ( how much do you pay for the best antibactetial/ antivirus/ antifungal known when your child is sick?)and above ground reserves are being depleted at astronomical rates( 100 million Oz last month- vaults will be empty in March by latest at current rate but deliveries are skyrocketing), no metals are available in Switzerland. It will take years for new supply to come on line. Trade wars have consequences and China has 60%+ of refining but has effectively stopped export except as finished goods and may stop accepting USA FRN in payment. Printing $40,000,000,000/ month (current rate)will have consequences as it is showing in stonks/crypto/ treasuries blowing back up.
I sold some silver a couple months back to a local dealer with multiple store front locations and they paid me spot. I have used them several times and they always paid spot. Others would try and buy at about $10 under spot.
fwiw, my local metal dealer is selling silver US coins at spot. the smelter he deals with is only taking 999 for now and he’d also doesnt want to get caught holding too much when the cliff arrives. i suspect he’d go lower on a bulk deal, but i just cant bring myself to buy at these levels.
interestingly, he will buy krugerrands at spot.
I’m going to stop by the place there and pick some more up…
Mind you, the prices have almost certainly changed since Monday.
By the minute, bud.
It’s one of those things i really don’t *need* more of, but…
Around the holidays my sister asked me about getting into silver. Nothing crazy, just putting a grand into it as a bit of a hedge. She didn’t pull the trigger. Now prices have more than doubled.
PM’s have gone up so much so fast. I’m kinda happy cuz I do have some silver and gold. I am concerned about what this says for our economy.
I’m not buying at these prices. We are close to irrational exuberance price wise. I see a correction coming.
Doesn’t matter to me though. It’s part of my emergency fund. Silver and gold in the safe are still silver and gold in the safe.
At current prices, I feel my money is better spent elsewhere for now – there is nothing value about high spot prices and I’m a value guy.
Ammonia starting to go up again, so I’ve bought more of it to get certain calibers where I want to be.
One could make a good case for a DCA approach.
I’m blessed (and/ or smart) to have secured sufficient amounts of silver and gold at a much lower basis point than today. So I’m not buying at these prices. However they didn’t. Having a little something put back that gets some of their $$$$ away from fiat would be wise. Like the saying goes the best time to plant a tree is 50 years ago and the next best time is now.
Don’t make the mistake of valuing precious metals in terms of $$$. Overseas, the metals are priced way higher than “spot” because they see the real value of a commodity (money) that can’t be printed.
Friday’s rig job was nothing more than a bank bailout to cover their massive short position loses and possible bankruptcy. Thanks JPM.
Well looks like we are seeing a sell off of gold and silver today!
May be. Of course, people may then think “This is The Dip! Time to buy!” and push it back up.
Yep, some profit taking for sure, but you are correct on others seeing it as a time buy. My financial guy always tells me to buy stocks when they are on sale (dips) not at premium(highs).
Buy low, sell high…always a winning strategy.
https://www.youtube.com/watch?v=EE6BoqaANhg
CZ, you might want to check this out?
Could put a crimp in things…..
Meh. We’re always just a button push away from this sort of thing. I wonder if the situation was actually this serious, would the powers that be actually tell us?
Gold, silver and platinum are on sale. My miner’s were hammered today and I look forward to Monday for a buying opportunity.
As of now, Jan 31, JMBullion is selling $10 face value of pre-65 US silver coins with no spot premium (other than a credit card fee if you use one) for $640 (that’s including card fees which I incurred). No telling what the markets will do Monday after Friday’s bloodbath, but it could be a good chance to capitalize on the sharp drop. By my math, that’s 21.42 oz of silver in the $30 face I bought.
Just a heads up for any silver hoodlums still reading this post.
$10 face value should only be 7.14 oz, not 21,42.
$1,40 in face value is one ounce
Then $640 / 7.14 =$89.64; which is consistent with spot.
UBAZ is referring to his $30 in face value of silver that he purchased being at 21.42oz, not $10.
$30 face is what I bought, see above. Sorry if that wasn’t clear.
Ah, my mistake bud. Trying to read in the dark and I Mistral about the $30!
The action China took effective January 1st probably has to do more with the run up of silver than anything else.
https://www.morningstar.com/news/marketwatch/2026010376/china-is-using-silver-as-an-economic-weapon-what-that-means-for-investors-and-prices
90% Constituional is below spot ( sterling also) as the world’s supply of nitric acid has been used up making munitions for Ukraine and can’t be used to chemically refine lower grades of silver. Buy up lower grades or recognized coin at discount.