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Bill Murphy, "Lines at the Coin Shop"

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#1 Tue, Jun 21, 2011 - 11:22am
Jake
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Bill Murphy, "Lines at the Coin Shop"

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Could the Paper Silver Market Be Losing its Price Discovery Mechanism?"

Paper silver vs physical silver
Edited by: Jake on Nov 8, 2014 - 5:09am
Tue, Jun 21, 2011 - 11:28am
SilverTree
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Silver

Tue, Jun 21, 2011 - 11:34am
John Galt
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Good Observation

I don't know how recently this interview with Bill Murphy took place, but his comment that there is steady buying for physical gold and silver is accurate. Last week I visited my local coin shop and asked how sales were going. After silver was hammered down in early May it has settled into a sideways price channel. I would have expected that this waning interest in silver would have quashed buying interest. Apparently not, because I was told that buying remains steady. In fact, it was during my visit I overheard one guy buying $150,000 worth of PMs, and was paying in a combination of cash and wire transfer.

Unlike the Hunt's buying in the late 1970s where a handful of investors were moving the market, the Hunt's ended up being brought down not so much by their physical buying but their leveraged positions. This time around the buyers of physical are worldwide, and they are millions strong and growing. Plus given the fact that even with a price takedown so little physical got sold back tells me that most people buying the real stuff now are doing it without leverage, and are buying to hold for the long term.

"So you think that money is the root of all evil. Have you ever asked what is the root of all money?"
Tue, Jun 21, 2011 - 11:42am (Reply to #3)
SilverTree
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Coin shop closed

My local coin dealer was closed for "inventory" yesterday, I just called and no answer. 

Tue, Jun 21, 2011 - 12:04pm (Reply to #3)
Jake
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No one Wants to Wait

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John Galt wrote:

Last week I visited my local coin shop and asked how sales were going. After silver was hammered down in early May it has settled into a sideways price channel. I would have expected that this waning interest in silver would have quashed buying interest. Apparently not, because I was told that buying remains steady. In fact, it was during my visit I overheard one guy buying $150,000 worth of PMs, and was paying in a combination of cash and wire transfer.

My dealer has almost given up on trying to place orders for large dollar customers. Instead, he purchased as much as he could to fill requests so that customers can leave with their silver, on the same day, as hardly any one wants to wait. He's also planning on purchasing another local coin shop who has a larger inventory.

Your Silver--I Want to Buy it! Sell Me Your Silver!
Tue, Jun 21, 2011 - 2:52pm
jackmeoff
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@John Galt

Last Friday I was able to pick up 700 ASE's and only 3 AGE but had to drive 400 miles and through 2 states and had to see 3 dealers just to pick this up. Also the first dealer I saw said he had an order for gold of $500,000 for AGE for a man that drove from Florida ( Here to GA). One thing I have found out though is that some dealers are not wanting to sell what they have because they got caught with their pants down on this last move down. I am guessing we will see some more inventory magically appear once the price gets back up to $40 or so but who knows.

Tue, Jun 21, 2011 - 2:59pm (Reply to #6)
Captain Silver
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Two dealers here, good supply

My two local dealers here still have a good supply of ASE/AGE, but said their business never really spiked like some of the other coin shops a few towns over. One fellow still has a couple of monster boxes of 2010 ASEs, one less than he had last week cool He was willing to sell at todays prices at fairly low premiums (Well below APMEX or Bullion Direct). Moral of the story, I think premiums are very location specific and it pays to look in smaller markets for good deals. Luckily these guys haven't "benefited" from the mad rush to PMs, lucky for me that is!

Our monetary system has been hijacked by morons! Abandon ship!!!!
Tue, Jun 21, 2011 - 3:00pm (Reply to #6)
SilverTree
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So, you dropped >$30k?! Man I

So, you dropped >$30k?!

Man I wish I could do that!

Tue, Jun 21, 2011 - 3:06pm
jackmeoff
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@SilverTree

That is only because we sold the 3rd car and I also had a CD mature. I wish I could do that all the time but I cant.

Tue, Jun 21, 2011 - 3:09pm (Reply to #8)
Captain Silver
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Out of stocks (mostly), don't want fiat

Had to put the money somewhere. :p Got a good deal and traded some generic bars for ASEs + some fiat. Trying to convert larger format holdings into more recognized and usable formats. Doing it in both gold and silver. Been making regular physical purchases as of late anyway. Too old to go back to work full time if I lose it all in an inflationary collapse. Survival mode man!

Our monetary system has been hijacked by morons! Abandon ship!!!!
Tue, Jun 21, 2011 - 5:52pm (Reply to #10)
Seacap81
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Captain Silver:  What are you

Captain Silver: What are you referring to when you say, "trying to convert larger format holdings in more recognized and usable formats." Does this mean something like trading a 100 oz silver bar into eagles and other coinage. Do you want your silver and gold in smaller increments? Just trying to get a feel how others are thinking.

Tue, Jun 21, 2011 - 6:14pm (Reply to #11)
No1Hunter
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That's what I am thinking

Seacap81 wrote:

Captain Silver: What are you referring to when you say, "trying to convert larger format holdings in more recognized and usable formats." Does this mean something like trading a 100 oz silver bar into eagles and other coinage. Do you want your silver and gold in smaller increments? Just trying to get a feel how others are thinking.

That is what I am guessing. It is much easier to sell a 1 oz'er compared to a 100 oz'er.

I have stayed away from the big bars for that very reason. Big bars are nice to handle or show off to your friends (make sure they are your friends) but ten 1 oz'ers = one 10 oz bar, 100 1 oz'ers = 100 oz bar when it comes to silver. 

Tue, Jun 21, 2011 - 7:24pm (Reply to #11)
Captain Silver
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Not all silver is equal

Exactly as N1Hunter was saying, getting rid of larger bars in favor of rounds, and recently silver eagles. i've also bought a number of Canadian and US Mint commemorative rounds. These are products that people will recognize and be comfortable with in trade. I've found that you can leverage large trades with dealers to collect Silver Eagles for much lower premiums. In the last trade I was able to pick up 500 2009 ASEs for just over spot by trading 4 100 oz bars and some fiat. Much happier with the ASE going forward. Silver may be silver, but some products will always be more sought after than others. Still hold larger bars as investments, but trying to get a nice position in ASEs, Maples and the like.

Our monetary system has been hijacked by morons! Abandon ship!!!!
Tue, Jun 21, 2011 - 7:29pm (Reply to #6)
tmosley
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Inventory ALWAYS "magically"

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Inventory ALWAYS "magically" appears when the price goes up. That is the most basic rule of economics.

Tue, Jun 21, 2011 - 8:58pm
Gramp
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Au, Ag

Same here... dropped a few 10 oz. bars for decent price. Then "balanced " my personal holdings w/ more Au! ;)

 Today visited the local coin shop. Had Great conversation w/ the owner, (was hoping he would have time to chat) He made the comment, "have you read some claim there is not a single oz. of Au at Fort Knox?)

To which i replied "Not sure, but I know how many oz. I have!!"

Picked out a few Common date Peace Dollars, Nice doing some local business!

Man... I LOVE buying PHYZZ! cool

~ Even a dead Fish can go with the flow ~
Tue, Jun 21, 2011 - 11:56pm
Tringo
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Purpose of Maples

Question for folks who don't live in the northern/Canadian border area: what is the draw to buying Maples? I could see if you're in an area close to Canada, but for someone in the south, how does that benefit you as opposed to ASE, outside of the "sliver is silver" line of thinking? Are the premiums less on Maples? I've just never looked into them. Thanks for your thoughts.

Wed, Jun 22, 2011 - 12:27am
Prize Fighter
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I love Maples and live in the

I love Maples and live in the Southeast. Less premium, 4-nine silver (.9999), and IMO a better looking coin. The premium difference between them and ASE is usually $1 or more. The only thing I don't like is their tubes are 25 coins. Monster boxes are still 500 though.

Besides Maples, Philharmonics have the least premium. Highly overlooked coins and for that reason, I like them.

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