Why is Platinum running?

FloridaBill

Steady course back up, but nobody is watching?

FloridaBill

PerryHall

<< <i>Steady course back up, but nobody is watching?

FloridaBill >>



Maybe the economy is starting to turn around. Don't forget that Platinum is an industrial metal.

secondrepublic

I knew I should have bought it when it was 700... grrrr....

roadrunner

It's been running up with the entire commodity sector over the past weeks/months. And the Central Banks have no real reason to help knock down the price since so few people speculate in plat. Gold and silver started up first but platinum wasn't far behind. Copper has been very strong increasing 65% since last fall. Oil is up around 50%. Commodities were so badly thrashed last year that they went far below fair market value so that hedge funds, institutions, and banks could get liquid. They sure as heck couldn't sell their SIV's, CDS's, or MBS's quickly to raise cash. Whether this is just a bounce back, or a new bull run up remains to be seen. Commodities were in a secular bull market from 2003-2008 when they were derailed by the bank's credit crunch. They are one of the first things in an economy to see price increases when monetary inflation and liquidity get out of control. There are numerous cases in history when overall economy is spiraling downwards, the currency is debased, and yet the price of basic commodities (food, energy, PM's, etc.) continues to rise against the price of the currency.

Platinum is an industrial metal, but it's price is generally supported by the price of gold. If the price of gold got too far ahead of platinum, all the gold bugs would start stacking up on platinum, and why not? On the flip side, if platinum became too scarce because people were hoarding it rather than gold, the govt would step in and force it from people's hands in an emergency economic directive. And then you'd have to turn it in or risk not being able to sel it in a free market. I don't know how that would apply to govt issued platinum coins since that is the primary means which the majority of public probably hoards platinum.

roadrunner

BigE

No one is talking about dumping tons of platinum on the market, and also there is no platinum mini through futures brokers and at 11,000 per contract they tend to stay in strong hands. Palladium seems to be following---------------BigE

Weather11am

Pt is moving, up 3.5% already!

jmski52

From Sinclair's web page:

South Africa Mining Output Falls by Most in a Decade
By Carli Lourens

April 9 (Bloomberg) — Mining production in South Africa, the world’s biggest producer of platinum, fell by the most in more than a decade in February after metal and diamond prices declined.

Output dropped 12.8 percent in February from the same month a year ago, Statistics South Africa said on its Web site today.

Metal prices tumbled from records last year as the recession curbed demand and discouraged production. Platinum, mainly produced in South Africa, declined 40 percent in the past year, prompting producers including Lonmin Plc to suspend mines.

Looks like a possible correction to an oversold market condition to me.

lope208

Excellent, now if it just climbs back to $1950 I can break even on my 10th anniv. plat set!!

Ahhhh. Remember when plat touched $2300? Those were the days.

jmski52

Ahhhh. Remember when plat touched $2300? Those were the days.

The market peaks don't matter. Don't worry - you'll see $2,300 platinum before you know it.

lope208

<< <i>Ahhhh. Remember when plat touched $2300? Those were the days.

The market peaks don't matter. Don't worry - you'll see $2,300 platinum before you know it. >>



I agree with you on that. It's just that my overall view of the plat market is skewed because
I ONLY own 1 oz of the stuff and I bought high. I'm not worried though, it'll sit safely in my SDB
until the market says it's ready to come out. I'm just glad I'm fortunate enough to not need the
money right now.

Overdate

>>The market peaks don't matter. Don't worry - you'll see $2,300 platinum before you know it.<<

Last year's market peak does matter in one respect. A lot of platinum coins were melted, reportedly including scarce ones such as the larger 2006-W burnished coins with mintages in the low 4 figures (and a bunch of proofs). In the short term this may have provided a one-time bump to the supply of platinum available for industrial use, and contributed to the steep slide.

Now we apparently have supply issues, along with increased investment interest and fewer coins for the small investor. In many cases, the premium on platinum coins is higher than the premium for gold coins. As far as I know, there have been no 2009 U.S. platinum eagles of any description made yet. Is this due to a shortage of blanks or a shortage of platinum in general? Not sure if any non-U.S. platinum coins are currently being produced.

So last year's run on platinum may partially explain the steepness of the market slide and the current high premium for platinum coins.

clouisejewelers

<< <i>I knew I should have bought it when it was 700... grrrr.... >>



Trust me, I tried. I only got a few coins, as almost nobody was selling at those prices. This was true all the way up to $1000/Oz. It is still difficult to find and priced way over spot.

MrOrganic

why the run up!


the big red machine!!!!!!!!

CHINA (infrastructure/industrial metals)

OPA

Run up was fueled by speculators, it will correct itself ... It always does.