Memo to ...ALL....
topstuf
Posts: 14,803 ✭✭✭✭✭
Prices on physical "destabilize" .....EVERY.... time the Comex (or any market) quote goes nuts.
Dealers in physical metals do ...NOT.... have piles of the stuff just waiting for panic buyers.
GOOD dealers will still make the delivery.
It may be delayed, but a GOOD dealer will honor his commitments.
Delivered contracts, refined scrap, junk coins,....ALL of that is not converted to retail bars or rounds in 30 miinutes.
This ...has.... happened before.
NONE of my customers "went without."
Buying at these critical swings ....WILL.... mean wider spreads, delayed delivery, hurt feelings, accusations and worse.
You can't expect "instant trades" on anything that has to be shipped.
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Comments
I am still waiting to hear what the "valid" (i.e. qualified, verifiable, specific) reasons are for the large price disconnect between the spot price quoted by the bullion dealers vs what they will actually sell you metal for.
FYI, I think the "spot price" determination is where the problem may begin.
HJP
https://forums.collectors.com/discussion/1023467/found-formula-for-taking-futures-quotes-and-converting-to-spot
I gave you the reasons. If 35 years selling bullion in quantity isn't valid then keep looking.
You just need to become better informed.
Dealers do not quote spot, they report it. Spot disconnected from physical when paper trading became convoluted.
Thank-you for your insight, topstuff.
I take it that as volatility increases, most dealers protect themselves (and their business) with larger than usual premiums.
Makes perfect sense to me.
I knew it would happen.
Not just protection, its to cover the cost of replacement as well. Any decent size dealer hedges their buying and selling, not free, but offers the greatest level of protection in the industry.
OK, who sets the "spot" price?
What are the elements that are used to establish the "spot" price?
Are there any verifiable metrics that are used to set this number?
What are the "reasons" those who "set" the spot price everyday are influenced by?
Any chance the futures market "spot price" is based on only hype & hyperbole?
Google
Now hear this, "Paper investors dictate the price of silver." That is all. Semper Fi!
The whole worlds off its rocker, buy Gold™.
Warren Buffet once bought and later sold 40 MILLION ounces of silver. I think he lost money, but the point is the paper spot market is for him. The physical market is what most of us play in. The 40 million ounces he bought and sold maybe never existed in the physical word. They (spot and physical) are only peripherally connected.
So, in essence the spot price is an arbitrary number based on the opinions of 5-6 bullion traders- who are also buying / selling future contracts ?
An Introduction To Trading Silver Futures
The major players in the silver futures market include:
• The mining industry
• Refineries
• Electrical and electronics companies
• Photography companies
• Jewelry businesses
• The automobile industry
• Solar energy equipment manufacturers
The above players mainly trade silver futures for hedging purpose aimed to achieve price protection and risk management.
Another source of the major players in silver futures markets is the financial industry. These players may also be in it for the speculation and arbitrage opportunities and include:
• Banks
• Hedge funds and mutual funds
• Proprietary trading firms
• Market makers and individual traders
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Google.
Had a long talk with my local coin shop dealer two days ago, he's a player.
He is holding from selling ANY of his AU or AG in his shop for now. He's closed right now due to Kung flu. He told me to hold and not to sell. As a matter of fact he told me to buy, buy , buy.
He said last two days before he closed he had like 500 people in and 1,000 people the 2nd day. He said it was epic!!!
He said he can't replace or find the AG from any of his regular wholesellers, Shits about to hit the fan sounds like.
Panic... plain and simple...panic in silver and TP....and other staples as well. Cheers, RickO
Just sold 5 ASEs on ebay for $24.80 ea. Buyer was even willing to pay sales tax.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Could he use a sealed 2016 Monster Box?
I think I'd even carry the shipping cost if he was legit.
No won't happen. But I might trade you gold for it