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Silver Premiums Are Out Of Control!

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Pillar of the Community
United States
4849 Posts
 Posted 10/16/2022  1:09 pm  Show Profile   Bookmark this reply Add TheForce to your friends list Get a Link to this Reply
It kinda sounds like from various posts here and from many content creators over on YouTube that most are saying they aren't buying the ASE because of the high premiums. There are plenty of alternatives. That said, will the demand drop and force the premiums down?
Bedrock of the Community
Australia
20588 Posts
 Posted 10/16/2022  7:04 pm  Show Profile   Bookmark this reply Add sel_69l to your friends list Get a Link to this Reply
If I can't buy silver at spot, or below, I won't buy it.
Needless to say, those sorts of buying opportunities are very few and far between.

Since I am almost exclusively a coin collector and not a stasher,
my usual modus operandum is to be successful with numismatic job lots at public auction, where NCLT silver has not been the main subject in the lot.

No premiums with this sort of strategy to pay, but you have to be successful with low bids. That is why silver buying opportunities are so scarce, but for me, that is OK.
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United States
2669 Posts
 Posted 10/19/2022  8:20 pm  Show Profile   Bookmark this reply Add thq to your friends list Get a Link to this Reply
It's interesting to watch premiums rise as the price of metals falls. It appears that the sellers are defending a price point below which they will not sell. The premium is almost incidental: I will not sell you my cleaned gold eagles unless you pay $1000 for them.
"Two minutes ago I would have sold my chances for a tired dime." Fred Astaire
Edited by thq
10/19/2022 8:21 pm
Valued Member
United States
87 Posts
 Posted 10/19/2022  8:35 pm  Show Profile   Bookmark this reply Add 91o_collector to your friends list Get a Link to this Reply
Was at a local coin show last weekend, most of the dealers did not have silver rounds or bars in bulk quantity. Reasons were anything from no inventory to not wanting to carry that much weight to a show. The limited dealers that had silver with them were at $23 to $24 an ounce, 1 oz. rounds / 10 oz. bars. Most of the Morgan / Peace dollars were $30 minimum in junk box, $35 to $40 for common F to VF.
Pillar of the Community
United States
2669 Posts
 Posted 10/21/2022  12:54 pm  Show Profile   Bookmark this reply Add thq to your friends list Get a Link to this Reply
The current high silver premiums are puzzling to me. I'm used to 5-10% on 90% US circ bullion silver halves. I haven't bought one for years, but used to pick up a few from time to time. Currently premiums are 80-90%. Thinking this might be a US problem, I looked at the similar UK sterling half crowns on the UK bay. The premium might be slightly lower, but is still well over 50%.

So what's going on? There is an apparent supply shortage. But dealer lists I see offer no more than spot for these coins. They're offering no premium to sellers to increase their supply, yet charging prohibitive premiums to buyers. Kind of a pinch: not a sellers or a buyers market. There's no volume in pricing metals as collectable coins. Maybe they're all bailing out of the physical market.
"Two minutes ago I would have sold my chances for a tired dime." Fred Astaire
Edited by thq
10/21/2022 1:01 pm
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2621 Posts
 Posted 10/21/2022  5:51 pm  Show Profile   Bookmark this reply Add NumisEd to your friends list Get a Link to this Reply

Quote:
So what's going on? There is an apparent supply shortage. But dealer lists I see offer no more than spot for these coins. They're offering no premium to sellers to increase their supply, yet charging prohibitive premiums to buyers.


Buying low and selling high basically tells me that "Dealers" have turned into "Investors": they are interested in obtained junk silver but do not wish to part from it unless someone pays an exorbitant price.
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United States
2669 Posts
 Posted 10/21/2022  6:42 pm  Show Profile   Bookmark this reply Add thq to your friends list Get a Link to this Reply
There has always been a higher premium for the dollars, but not for the halves NumisEd. I cannot imagine a lot of people wanting to sell their halves for $7 at a time when they're retailing for $12.50, unless they were really desperate for cash. And I can't imagine that very many people are dumb enough to pay $12.50 for them either. That's why I'm speculating that dealers no longer want to play in the physical metals market. They're driving the investor stackers away.

20 years ago I was buying semi key walkers out of cull cans for 5-10% over melt. 1919-D's and 1923-S's in VG for instance. They were such a drug on the market that they weren't worth putting in a flip. I gradually shifted to high grade Franklins and 64 Kennedys to get full coin weight.
"Two minutes ago I would have sold my chances for a tired dime." Fred Astaire
Edited by thq
10/21/2022 6:51 pm
Pillar of the Community
United States
2669 Posts
 Posted 10/22/2022  10:43 am  Show Profile   Bookmark this reply Add thq to your friends list Get a Link to this Reply
Having read several of the recent threads on this subject, I'm leaning towards the following rationalization.

The ETF paper silver is the elephant that sets the melt price. Currently SLV has 544 million ounces of physical silver, with a similar number of shares outstanding. Unless they are under pressure to increase inventory (new buyers of their shares), the price stays down. Shares/ounces of SLV increased by 200 million during Covid, and over the last 6 months have dropped by 100 million.

However, there is no great supply of physical silver at the price the ETF's trade at. When SLV disposes of 100 million ounces of London bars, 90% coins and ounce rounds do not appear in response. The retailers raise their premiums to reflect their inability to resupply against the ETF's massive inventory shifts.

https://www.kiplinger.com/investing...gotten-metal

https://www.sharesoutstandinghistory.com/slv/


"Two minutes ago I would have sold my chances for a tired dime." Fred Astaire
Edited by thq
10/22/2022 11:34 am
Valued Member
United States
470 Posts
 Posted 11/01/2022  5:09 pm  Show Profile   Bookmark this reply Add Dowhat to your friends list Get a Link to this Reply
From what have learned the COMEX and London silver have been slammed for delivery of physical which is rapidly diminishing their ability to meet the demand. Stockpiles have dramatically fallen in the last 6 months.
As most of you already know, paper contracts manipulate the spot price of silver. Low spot prices are supposed to discourage investors from calling in their contracts but it has not. The big investors in the know realize what is coming and demanding delivery. Sometimes waiting up to six months for the physical for say 1000 1 kilo bars. Your gonna wait a while. More is leaving the vaults than coming in already.
If spot prices rose to the levels accurately representing value of PM,they would be wiped out overnite.the
IMO, that is a reasonable explanation for higher premiums we are all paying. It reflects the actual value of the metal rather than the manipulation of the ETF's.
The historical silver to gold ratio has been around 40:1 today I think it is around 80:1. This may correct to historical ratios sooner than you think with the BRICS nations making a rapid move to replace the US dollar as the reserve currency. All OPEC nations have joined BRICS. Russia, China, and India have increased gold reserves incredibly in the last three years as well as silver. They are dumping US Treasury bonds like crazy in an attempt to back their currencies with PM. All of those trillions of dollars will end up back here. Talk about hyperinflation. It is right down the road.
If the FED pivots on rate hikes and holds steady, or worse, begins to lower rates, thank God you have the PM you do. Image the value of your stack with a 40:1 silver ration(historical average) compared to the present 80:1. The Fed rate needs to be about 20% right now to keep us from falling off the cliff, and that ain't gonna happen.
That is just the way I see things by watching what is currently happening around our orb in space.
I do not hesitate to stack as much as I can at this point in time because we ain't seen nothing yet. Just look at your local availability for silver and all of the "Alert Me" notices for online dealers. I do not go near ASE's, stupid premiums. There is no more "Junk" silver. It is no longer "junk". If I do pick some up I refer to it as "Constitutional Siver". Calculate $1.40 of 90% (1 ozt.) and determine that premium over spot! Is that junk?
I cannot ever see the day when I will exchange PM for US Dollars.
Get it while there is still a window to do so, because IMO, at least you will have a chunk of "real" money in your hand, be it big or small, that those who wish they did will not be able to.
Good luck to all and let's see what it is like around the end of the 1st Qtr next year.
I hope this provides some insight.
Valued Member
United States
474 Posts
 Posted 11/07/2022  06:36 am  Show Profile   Bookmark this reply Add jaxenro to your friends list Get a Link to this Reply
When silver was in the $22/$24 dollar range I could get a roll of 90% dimes for about $105 off of eBay today with silver around $19/$21 the same roll is $110. In fact I am losing auctions at $110 (all are cost + shipping)

Spot is a mostly meaningless number for small buyers. To paraphrase Warren buffet, silver is worth what you can sell it for not what some book says it is worth
Pillar of the Community
United States
4849 Posts
 Posted 11/11/2022  9:56 pm  Show Profile   Bookmark this reply Add TheForce to your friends list Get a Link to this Reply
Was just browsing SD Bullion and 2022 dated ASE's are $43 and some change when paying with a credit card, slightly less with a check but not by much. Are people really stacking these at that price?
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2621 Posts
 Posted 11/11/2022  10:13 pm  Show Profile   Bookmark this reply Add NumisEd to your friends list Get a Link to this Reply
"The cure for high prices is higher prices".
The more expensive ASEs become, the less people can afford it.
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18456 Posts
 Posted 11/12/2022  12:05 pm  Show Profile   Bookmark this reply Add T-BOP to your friends list Get a Link to this Reply
I told you guys years ago about spending money on new Bullion coins . Now your crying about prices going through the roof . If you want to stack 90 % junk silver right now you have my blessings just be very careful if you just have to have those ASE's and such .
Tony

For Butch & Jim rest in peace .
Pillar of the Community
United States
1856 Posts
 Posted 11/12/2022  1:44 pm  Show Profile   Bookmark this reply Add CoinHunter53562 to your friends list Get a Link to this Reply
People upset about premiums being high are going to be even more upset if the spot price (and physical price) go up. Let's say spot is $19 and the premium for generic silver is $6, then you pay $25/ounce. What if the spot price goes up to $25, but the premium drops to $2-$3? You're still paying more than today's prices.

Instead of worrying about the day-to-day prices, just keep dollar cost averaging if you're a long term stacker.
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Canada
4497 Posts
 Posted 11/12/2022  1:53 pm  Show Profile   Check Pacificoin's eBay Listings Bookmark this reply Add Pacificoin to your friends list Get a Link to this Reply
Dealers like Arizona Coin are paying Silly prices ,
so I guess there are retail buyers at even sillier prices!
Good luck buying cheap silver.isn't happening soon !
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