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 Replies: 14 / Views: 1,832 |
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Valued Member
Cyprus
349 Posts |
Hi folks, I see that silver is about AUD31.42 an OZ but Perth Mint sells 1 oz silver Bullion coins for $AUD42.50 each. Is this a misprint or have they lost the plot? Regards, Ozzie Edited by Ozzie
07/02/2011 11:50 am
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Valued Member
United States
362 Posts |
no, dont think so. A lot of the things I've seen at the Perth Mint has always had a high premium, but I think anything over 10-15% over spot is a little ridiculous. And I have also noticed some high premiums on a lot of items. Maybe its because everyone is expecting silver and gold to go up, so they are refusing to sell closer to spot? Prices on ebay havent seemed to change very much from 40$ an OZ to 33$ an ounce. But that may just be me. |
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Pillar of the Community
1283 Posts |
I know it is still hard to get ASE for under $40 each online. |
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Pillar of the Community
United States
2120 Posts |
With Silver moving so much, and the sharp drop in may, a lot of dealers are protecting them selves. They add higher premiums when you buy coins because when they bought it, silver was a dollar or so higher. If they kept lower premiums they would be giving away money.
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Valued Member
 Cyprus
349 Posts |
I would have thought the mints would be buying below spot so they can sell a little over spot. But AUD$11 over spot is a lot for a 1 oz coin. They also sell proof collector coins for massive mark ups.
I would have to agree with gbay prices being high too. What would it take to bring down these premiums? I crash below $20 in the silver price?
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Pillar of the Community
United States
2661 Posts |
They can't make any money if they sell the silver they bought at $40+ below that level. The last coin show I went to one dealer had 2011 ASE's with two different prices. The ones he bought when silver was around $45 were priced higher ($52.50)than the ones he bought at $38 ($45). That is just how it will go until they exhaust the over price inventory they now have. |
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Rest in Peace
United States
9104 Posts |
There are coin dealers, and there are bullion brokers. Here's the difference in how they operate:
Coin dealers
Buy for inventory, trying to buy as low as possible and sell for as high as possible. If the market drops, they may hold out until they can at least get their investment back. Or they may play the market, buying $15 silver that they don't even offer for sale until it's $40.
Dealers worry that they may never see some stuff again, so they price it over market and sit on it.
Most coin dealers started as coin collectors, and do many non-businesslike things, like marrying their inventory.
Bullion Brokers
Turn inventory, trying to make a steady profit all the time.
If the market drops, they drop too. If they sell 1000 oz for 45 they buy at 38. If the market drops to 40, they simply drop their buy to 33. If they find they can't buy at 33, but only get inventory at 36, they don't sell for under 43. There's where the premiums occur.
A broker may carry a 100,000 ounce inventory. He's not interested in accumulating more, which may stick him at higher prices. He wants to balance incoming and outgoing ounces on a daily, even hourly basis. If lots of material comes in, he lowers his buy and sell prices, and vice versa.
Brokers know that there's never a shortage, just some stuff that may require higher buy prices. Anyone who doesn't believe this, hand me a million dollars and watch how fast I can turn it into bullion.
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Pillar of the Community
United States
3670 Posts |
Perth makes a lot of nice HIGH priced stuff, and some of it is so high, I wonder if it will sell again. I have 8 lunar coins, and don't worry about those as they seem to be very popular, at least at the time being, and I think one must consider trends as well, changing back and forth over the years....
BiggFredd nice illustration. That really simplifies the two mind sets, and breaks them down nicely....
Edited by Silverhawk74
07/02/2011 2:08 pm
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Bedrock of the Community
United States
10038 Posts |
I hate to sound gloomy here, but if they are anything like most places here in the States, then prices are high b/c they know people will pay the price!
Supply and demand was overtaken with greed quite some time ago. When retailers/producers are sole providers of a product/service then a good many will take advantage of the consumer. Some of this is to cut down on volume of work and/or to pay off red-tape-imposed fees courtesy of the powers that be.
How much squash could a Sasquatch squash if a Sasquatch would squash squash? Download and read: Grading the graders Costly TPG ineptitude and No FG Kennedy halveshttps://ln5.sync.com/dl/7ca91bdd0/w...i3b-rbj9fir2 |
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Valued Member
United States
301 Posts |
I gave 42.00 for ASE's two days ago from a local dealer. Yeah, I thought the premium was too high, but what ya gonna do? Sure you can get them online cheaper, but by the time you pay shipping, it's a wash. |
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Pillar of the Community
United States
3345 Posts |
So what would happen if silver went to $20 oz, (I don't think it will) will premiums be around $28-30?
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Rest in Peace
United States
9104 Posts |
I don't think the price will stay at 48-50, which is a 28-30 premium, but the retail might be 28-30 for weeks or a couple months. Once the bullion brokers can get ASE for 22 from the gubmint, they'll resume selling at 24. If there is a production delay, as there was earlier this year, the premium will be based on what they have to pay to get physicals, until that delay disappears. |
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Bedrock of the Community
Australia
21788 Posts |
The Perth Mint does bullion coins. The quality of their workmanship and presentation is quite high. It has to be. The most efficient way to buy their products (IMHO), is in the after market. That way, you get to pick the coins you may like from a greater range at your price, rather than just what new product is currently on sale at their price. |
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Pillar of the Community
United States
1285 Posts |
One thing that the high premium's have done effectively is having people stop / slow down buying ASE's and move into other forms of silver. One dealer told me he would rather pay $40 for a BU Morgan than pay $40 for a coin that was minted in the last few years. There is something to be said about this and I have heard this from others as well. As per Mint products - There is a Higher cost associated with making collector coin's (US / any other Govt Mint) and there is big a difference in Bullion Vs Collector coins. My deux cents is that due to all the hype the fine line between investing in silver and collecting numismatic silver coins has gotten rather blurry. Fred is right..some of these dealers need to take a hit drop the premium and move on. They will make more flipping the inventory than selling high priced items.  Edited by Ceylon62
07/03/2011 08:11 am
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Pillar of the Community
United States
4008 Posts |
Quote:
Fred is right..some of these dealers need to take a hit drop the premium and move on. They will make more flipping the inventory than selling high priced items. I agree. OTOH, it can often be a choice between flipping inventory at reasonable prices and NOT selling the high price / premium items. There are a lot of ways to accumulate nice coins. If I visit a shop and the prices are too high, I thank the owner and look elsewhere. Yes, that costs me some time but I really do enjoy the hunt!  |
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Replies: 14 / Views: 1,832 |
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Posted 07/02/2011 11:18 am
