Letter From APMEX:
Dear XXXXX,
The United States Mint has suspended sales of gold and silver yet again. 2009 has seen an unprecedented demand for the 2009 Gold American Eagles and 2009 Silver American Eagles as investors have clamored to secure their assets and protect their wealth against the rising tide of inflation.
This suspension in sales is temporary as the U.S. Mint continues to produce these highly sought after coins. At APMEX, we have a very limited supply of both 2009 Gold American Eagle and 2009 Silver American Eagle coins in stock and ready to ship. Buy your gold and silver bullion coins now while they are still available in the marketplace.
Mint shortages have traditionally caused a significant increase in premium – however, at APMEX, we still have these coins available at very reasonable prices. Buy your gold and silver coins today before market conditions change more and prices are driven up from excessive demand.
The news from the U.S. Mint comes on the heels of the recent news of gold's all-time highs. It seems like every day, gold reaches a new high! Already this morning, gold reached $1,186.30 per ounce as investors continue to react to major financial news about gold.
News like this will only drive demand and prices higher, and supplies lower. Get your 2009 Gold American Eagle and 2009 Silver American Eagle coins at APMEX while we still have a supply to meet our customer's needs.
Buy your gold and silver online today at www.APMEX.com!
Respectfully,
David McCarty
Director of Marketing
American Precious Metals Exchange
Showing posts with label Metal. Show all posts
Showing posts with label Metal. Show all posts
Fake Gold: China and Ethiopia. Could You Be Next?
Apparently, the latest fad hitting the Gold market is shipping fake bars. This has been encountered in two countries that we're aware of and, make no mistake, many other countries are most likely standing in their vaults right now looking. The first report was from Ethiopia last year and the second report is about London Good Delivery bars shipped from the United States to China (Cite). Ethiopia had shipped bars to South Africa, and received them back. South Africa claimed that these bars were Gold plated Steel (Cite)!
Ethiopia had located another stash of bars they have that are also Gold Plated steel and I'm sure many more may have been found throughout the world. I'm willing to bet that all of China is wondering about their "Good" Delivery Bars. One can only begin to speculate at the depth and breadth that this scam encompasses. And it probably makes most investors wonder: Is my Gold real?
We'd be quivering too if we were sitting on shares of the GLD ETF.
Ethiopia had located another stash of bars they have that are also Gold Plated steel and I'm sure many more may have been found throughout the world. I'm willing to bet that all of China is wondering about their "Good" Delivery Bars. One can only begin to speculate at the depth and breadth that this scam encompasses. And it probably makes most investors wonder: Is my Gold real?
We'd be quivering too if we were sitting on shares of the GLD ETF.
The Precious Metal Investor Paradox
I made this flowchart for any newbies that may not understand how purchasing precious metals works.
Cash4Gold And The Class Action Law Suit
A class action law suit was filed in California against Cash4Gold because their jewelry was either "lost in transit" and only insured for $100.00 or their checks were mailed too late for them to get their Gold back. This sounds awfully similar to the 10 Confessions of a Former Cash4Gold employee. Feel free to review an article we wrote previously exploring the question: "Is Cash 4 Gold a Scam?" We can't say whether it is or not. But like many Grandfathers once said "If it walks like a duck, and talks like a duck, then..."
More Info on the class action suit:
http://www.israelidiamond.co.il/english/News.aspx?boneId=918&objid=5980
More Info on the class action suit:
http://www.israelidiamond.co.il/english/News.aspx?boneId=918&objid=5980
A Metal Trading Primer For Gold and Silver
For all you young guys starting out, you may be wondering how you can get metal for as cheap as possible. I'll do the best I can to help you out here. These are some of the assumptions I'm making about you as I write this. If you don't fit these then you probably already know the information contained herein:
Part 1: Buying
The way you need to start out is the most obvious way: buying. The easiest way to get metal is to trade FRNs (Federal Reserve Notes, aka Paper Cash) for the Metal. This is also referred to as "buying" it. The cheapest way to obtain metal by this method is to, like everything else, buy it in quantity. This accomplishes two things:
This method is not wallet friendly but is about the only way that you can get started. Now, you can try buying locally, which I encourage to support small businesses, but you will most likely pay more. This will happen because of two reasons:
So, don't expect to walk into a coin shop "guns-a-blazin'" with the latest printout of today's spot price and demand it. You'll learn quite quickly that the dealer has probably run into a million people just like you and will just as soon tell you to walk out the door. Remember, this guy is sitting upon thousands, if not hundreds of thousands, of dollars worth of highly liquid assets, he doesn't need your business, he has other customers to serve.
Part 2: Trading Metal
Once you have some metal, you may want to increase that. There are a few ways to do this, but you need to understand your course of action. Smaller denominations (aka Fractionals, Fracs) like 1/2 oz, 1/4 oz, 1/10 oz, etc are considered more valuable to some because of their increased liquidity and higher price.
What does this mean? You could potentially buy 1/10 frac gold coins, and potentially trade 8 or 9 of them for a 1 oz gold coin. The reason I say 8 or 9 is that most times you have to make some type of cash offer along with your fracs to make it more fair. Few people will trade a 1 oz coin for just .8 oz in fractional. You will find more people willing to trade .9 oz worth of fracs for a 1 oz coin, but there probably won't be a line of customers so be patient. That sounds great, what's the drawback? Ahh yes, the drawback.
Similar rules apply with silver as well, but due to silver's affordability, there isn't as much advantage trading silver fracs for silver 1 ozers.
Crossing Borders
Crossing the metal borders is where you can really gain some leverage trading. In order to do this you must become very comfortable with the concept of the Gold to Silver Ratio (GSR). The GSR is just that, the price of Gold (POG) divided by the price of silver (POS). What this ratio tells you is how many ounces of Silver you can get for each ounce of Gold. Historically the GSR has been on both sides of the spectrum.
During roman times, I believe, the GSR was 1:3 meaning one ounce of Gold could get you 3 ounces of Silver. The largest gap we've seen recently was about 1:85 and currently it is 1:60 meaning that one ounce of Gold will buy you 60 ounces of Silver.
So you're asking yourself: How can I play this ratio? By Trading your Silver and Gold on http://bullionstacker.com/ (BS) you can take advantage of this ratio. How you play it will depend on where you think Silver or Gold is going. Today you can get 1 oz of Gold with 60 oz of your silver, but if you believe that Silver will out perform Gold, meaning that the POS will increase faster than the POG, then you will want to wait, because if POS does increase faster then you'll see the GSR decrease. Lets say the GSR decreases to 52, Now you can get 1 oz of Gold for only 52 oz of silver, which means you've saved 8 oz of silver!
But What if I think Gold is going to outperform silver? Then you better buy Gold now, or trade for it now. When the POG outperforms the POS then the GSR goes up. So if you can get into Gold now then you can wait for the GSR to go up. So let's say you trade your 60 oz of silver for 1 oz of Gold. Then the GSR goes up to 72. You can now trade your 1 oz of Gold for 72 oz of Silver. You've now increased your Silver holdings by 12 ounces and you really didn't have to do anything! Or you can stay in Gold and be happy that it outperformed Silver.
Conclusion:
This is just a Primer to help you learn the fundamentals. I did take liberties with my numbers and do not guarantee that anything in this Article will go as stated. In many scenarios I neglected the cost of shipping and handling, which should be considered. In nearly all instances, the person shipping the Silver will need to pay more and this should be considered in the calculations.
Using this Article: This article is the copyrighted work of Debris and is to not be republished anywhere without this notice and citation links to both http://bullionstacker.com/ and http://uselephant.blogspot.com/ . Thank you.
- ♦You probably don't have deep pockets
♦You're brand new to metal trading
♦You don't have a lot of experience doing many other types of trades
Part 1: Buying
The way you need to start out is the most obvious way: buying. The easiest way to get metal is to trade FRNs (Federal Reserve Notes, aka Paper Cash) for the Metal. This is also referred to as "buying" it. The cheapest way to obtain metal by this method is to, like everything else, buy it in quantity. This accomplishes two things:
- ♦Quantity Discounts offered by seller
♦Lower shipping and handling charges (yes, this must be included in your Dollar Cost Average (DCA))
This method is not wallet friendly but is about the only way that you can get started. Now, you can try buying locally, which I encourage to support small businesses, but you will most likely pay more. This will happen because of two reasons:
- ♦The seller doesn't know you, and you two haven't established a rapport
♦Small businesses don't have the same economies of scale as the large online sellers so they have to charge more. In addition, the store has the added overhead of rent, electricity, etc.
So, don't expect to walk into a coin shop "guns-a-blazin'" with the latest printout of today's spot price and demand it. You'll learn quite quickly that the dealer has probably run into a million people just like you and will just as soon tell you to walk out the door. Remember, this guy is sitting upon thousands, if not hundreds of thousands, of dollars worth of highly liquid assets, he doesn't need your business, he has other customers to serve.
Part 2: Trading Metal
Once you have some metal, you may want to increase that. There are a few ways to do this, but you need to understand your course of action. Smaller denominations (aka Fractionals, Fracs) like 1/2 oz, 1/4 oz, 1/10 oz, etc are considered more valuable to some because of their increased liquidity and higher price.
What does this mean? You could potentially buy 1/10 frac gold coins, and potentially trade 8 or 9 of them for a 1 oz gold coin. The reason I say 8 or 9 is that most times you have to make some type of cash offer along with your fracs to make it more fair. Few people will trade a 1 oz coin for just .8 oz in fractional. You will find more people willing to trade .9 oz worth of fracs for a 1 oz coin, but there probably won't be a line of customers so be patient. That sounds great, what's the drawback? Ahh yes, the drawback.
- ♦Fractional coins cost more per oz. You'll end up paying roughly spot + $100.00 (at the least, but more commonly +$200.00) for a fractional 1/10 gold coin. Meaning if spot is 1100 an oz, you'll probably be buying a 1/10 coin for $130.00 or $1,300 per oz.
Similar rules apply with silver as well, but due to silver's affordability, there isn't as much advantage trading silver fracs for silver 1 ozers.
Crossing Borders
Crossing the metal borders is where you can really gain some leverage trading. In order to do this you must become very comfortable with the concept of the Gold to Silver Ratio (GSR). The GSR is just that, the price of Gold (POG) divided by the price of silver (POS). What this ratio tells you is how many ounces of Silver you can get for each ounce of Gold. Historically the GSR has been on both sides of the spectrum.
During roman times, I believe, the GSR was 1:3 meaning one ounce of Gold could get you 3 ounces of Silver. The largest gap we've seen recently was about 1:85 and currently it is 1:60 meaning that one ounce of Gold will buy you 60 ounces of Silver.
So you're asking yourself: How can I play this ratio? By Trading your Silver and Gold on http://bullionstacker.com/ (BS) you can take advantage of this ratio. How you play it will depend on where you think Silver or Gold is going. Today you can get 1 oz of Gold with 60 oz of your silver, but if you believe that Silver will out perform Gold, meaning that the POS will increase faster than the POG, then you will want to wait, because if POS does increase faster then you'll see the GSR decrease. Lets say the GSR decreases to 52, Now you can get 1 oz of Gold for only 52 oz of silver, which means you've saved 8 oz of silver!
But What if I think Gold is going to outperform silver? Then you better buy Gold now, or trade for it now. When the POG outperforms the POS then the GSR goes up. So if you can get into Gold now then you can wait for the GSR to go up. So let's say you trade your 60 oz of silver for 1 oz of Gold. Then the GSR goes up to 72. You can now trade your 1 oz of Gold for 72 oz of Silver. You've now increased your Silver holdings by 12 ounces and you really didn't have to do anything! Or you can stay in Gold and be happy that it outperformed Silver.
Conclusion:
This is just a Primer to help you learn the fundamentals. I did take liberties with my numbers and do not guarantee that anything in this Article will go as stated. In many scenarios I neglected the cost of shipping and handling, which should be considered. In nearly all instances, the person shipping the Silver will need to pay more and this should be considered in the calculations.
Using this Article: This article is the copyrighted work of Debris and is to not be republished anywhere without this notice and citation links to both http://bullionstacker.com/ and http://uselephant.blogspot.com/ . Thank you.
A Study In the Value of Silver
Many people state that Silver is undervalued and will often cite the Silver to Gold Ratio. Other people will say that one ounce once bought you a suit. I will attempt to gain an understanding into the value of Silver by examining historical labor prices versus the price of Silver. Let us start with minimum wage statistics. I will be using values from a table available on Wikipedia which you can review here. The United States didn't start a minimum wage until 1938, so those are the most historical numbers we can start with using this method.
Beginning with 1939, the minimum wage was 30 cents an hour. This means that at minimum, a person could earn 3 Silver Dimes or .217 Troy ounces per hour. Now let's look at the last year that Silver appeared in coinage. In 1964 the minimum wage was $1.00, 10 Silver Dimes, or .723 Troy ounces. This shows that compared to Labor, Silver was hugely undervalued in 1964. Looking at today's minimum wage which is now $8.25 an hour a person can now earn .591 Troy ounces per hour (Based on Silver @ 13.95/Troy Ounce). Please note that we didn't use Silver Dimes in this example as Silver Dimes are no longer being paid out.
This represents a steep drop in the value of Silver over the last 70 years in comparison to labor in 1939. To bring the ratios back in line, the value of Silver would need to roughly double! To further exemplify the point, would you believe today's minimum wage labor to be more skilled or less skilled than the labor in 1939 when America still had its manufacturing? Opinions may be mixed on this question, but due to the manual nature, I would argue that labor in 1939 was more skilled than today's labor.
Depending on your interest, we may expand upon these ideas in future posts. Have a wonderful day, and happy stacking.
Beginning with 1939, the minimum wage was 30 cents an hour. This means that at minimum, a person could earn 3 Silver Dimes or .217 Troy ounces per hour. Now let's look at the last year that Silver appeared in coinage. In 1964 the minimum wage was $1.00, 10 Silver Dimes, or .723 Troy ounces. This shows that compared to Labor, Silver was hugely undervalued in 1964. Looking at today's minimum wage which is now $8.25 an hour a person can now earn .591 Troy ounces per hour (Based on Silver @ 13.95/Troy Ounce). Please note that we didn't use Silver Dimes in this example as Silver Dimes are no longer being paid out.
This represents a steep drop in the value of Silver over the last 70 years in comparison to labor in 1939. To bring the ratios back in line, the value of Silver would need to roughly double! To further exemplify the point, would you believe today's minimum wage labor to be more skilled or less skilled than the labor in 1939 when America still had its manufacturing? Opinions may be mixed on this question, but due to the manual nature, I would argue that labor in 1939 was more skilled than today's labor.
Depending on your interest, we may expand upon these ideas in future posts. Have a wonderful day, and happy stacking.
