In Lopsided Markets, Knowledge is the Key|
August 08, 2013
In the past month gold and silver have fallen 4.5 and 5 percent, respectively, while platinum has gained 1 percent. This brings the relationship in line with more historical levels of platinum vs. gold. Silver is totally out of whack vs. gold. From a market viewpoint, physical silver is in short supply and demand nearly insatiable. While supplies have improved they are still not adequate for quick delivery.
Silver Eagles are a good case in point. Three weeks ago delivery at wholesale was four to five weeks with payment up front at spot plus $5. A week later it was spot plus $4 for three-to-four-week delivery and currently it is spot plus $3 for two-week delivery. The norm is about spot plus $2.35 for three-to-five day delivery.
These are wholesale prices for serious quantities. Silver Eagles by date have become much more active. This has brought back premiums for many dates that had disappeared when silver was higher.
Proof silver Eagles have been driven by investment demand for the last several years and premiums had also dissipated. That has now changed.
I can remember having a large hoard of these, several hundred, and offering them to the supplier of a major investment house at wholesale bid. The lot contained several dates that were 20 percent or so premium to common. The comment was, “What am I supposed to do with these? They won’t pay any extra.” I kept them instead of reducing the price and now one has exactly doubled with several live quantity buyers.
The moral here is when markets get lopsided, be smart, sit tight, or accumulate. Just make sure there is a sound reason to be there. Knowledge is key.
I recently purchased three collections of Barber dimes and quarters and one of halves. These were from VF-20 to AU-58. There were a few not quite VF. These were almost all complete and generally of very desirable quality.
What I noticed was that the same dates that usually come faulty or cleaned were and the ones we always have on want lists were not there. These were complete or 96 percent or so.
Quarter dates that might surprise you as missing in EF and above were 1896-O, 1901-O, 1903-S, 1905-O, 1906, 1906-O, 1907-D, 1908, 1909-O, 1910-D and 1911. A few of those dates might not surprise you, but note that the keys are not there and several thought to be common. Looks like a few sleepers in that list to me.
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• See what guides and supplies our editors recommend for keeping up with your collection.
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