and of course there is now a dislocation between spot price and what price people are actually buying and selling.
A sign that the comex is becoming obsolete in the world of real PMs? lol
"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
and of course there is now a dislocation between spot price and what price people are actually buying and selling.
A sign that the comex is becoming obsolete in the world of real PMs? lol
As long as a comex contracts are redeemable for physical the comex is still the way bulk buyers do business.
The bulk buyers (consumers and fabricators who actually use the metal) as well as suppliers (miners) are at the mercy of the speculators and the bullion banks who typically never redeem yet control the pricing mechanism to facilitate their profiting on the volatility that they create. Fortunately for the bulk buyers they have for years enjoyed the benefit of buying at suppressed prices, while the suppliers have suffered through the same suppressed prices. I see the tables turning, slowly but surely.
"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
and of course there is now a dislocation between spot price and what price people are actually buying and selling.
A sign that the comex is becoming obsolete in the world of real PMs? lol
As long as a comex contracts are redeemable for physical the comex is still the way bulk buyers do business.
for all the complaints about how much paper is traded, only 3,273,200 gold ounces were delivered on the August 2020 contract. that's 32,732 contracts. volume on the december 2020 contract was 279,319 today. I have a feeling if the entire maximum open interest for a particular month were to be delivered that the comex may be short but they could get the member firms to buy it from suppliers as they did to replenish this most recent crisis. One thing to remember when complaining about the amount which could be demanded is that the comex pairs buyers of contracts to sellers of the contracts. the comex is not the actual counter-party to the futures contract. in short the seller of the contract would be on the hook for delivery.
@roadrunner said:
Generic $20's are really starting to expand in premiums. $20 Libs in 62 and 63 are beyond red hot nuclear. 63-64 Saints have closed much of the gap that they lost since December.
roadrunner
Premiums for Double Eagles often lead the gold move up by a substantial amount. Dealers like to front-run the price.
Perhaps... I tend to think it as part of the price discovery process. Happens quite frequently, like with new cars, etc. Even quite a few here on the forum.... when buying from the the US Mint (or VaultBox! ) then pushing to see what it can be flipped for!
@cohodk said:
Not arguing with that, but in questioning your comment of dealers frontrunning.
So your saying it's OK for dealers (in a coordinated effort) to push prices higher then unload on the retail buyers?
Isn't front running illegal and unethical in equity markets?
No, I'm saying they are frontrunning future price increases for gold. Not illegally frontrunning someone else's preferential trade order.
If Double Eagles trade at a 50% premium to spot gold for a certain grade...and then gold takes off....and there is talk that it's a new multi-year bull market with gold about to double or triple in price....it stands to reason that they would frontrun, or mor accurately DISCOUNT, future big increases in the price of gold.
The problem is...if the price of gold doesn't rise....the ask prices for DEs are ridiculous. Dealers will hold out and then prices will fall rapidly (prices are sticky to the downside).
@cohodk said:
Isn't front running illegal and unethical in equity markets?
Absolutely. This form of frontrunning -- discounting -- is about expected or future increases in the price of gold bullion which may -- or may NOT !!! -- materialize.
They can ask whatever they want for a coin. We can choose to buy or not buy.
Not arguing with that, but in questioning your comment of dealers frontrunning.
So your saying it's OK for dealers (in a coordinated effort) to push prices higher then unload on the retail buyers?
Isn't front running illegal and unethical in equity markets?
These are coins not equities. And are you sure it's coordinated?
If I hear a news story that makes me think the price of beef is about to double and I go load up on steaks, isn't that just speculation? If I'm a store that sells beef and I buy a few extra cows, again, I'm not sure that kind of speculation is illegal or unethical. It's classical speculation that may or may not work out for me.
@cohodk said:
Are they just coins to the retail buyer?
My point was.....you have a dead period in bullion and coins....then bullion takes off...folks disbelieve at first...then it keeps going higher....then the coin people raise the prices not only to catch up but also to ANTICIPATE future increases which MAY or MAY NOT materialize.
At some point they raise too high and too fast and bullion doesn't go up more. That happened in 2007, 2011, and 2020. When it does, coins eventually take a bigger hit because AT FIRST the dealers are reluctant to cut prices (especially if they paid up for it in the first place).
Everyone is ALWAYS afraid of UNDERPRICING because gold will go up 10-20 fold like it did in the 1970's.
I'm certainly not buying at the moment. The DE premiums have been inflated for several years now. I haven't purchased any since around 2018-19. At that time premiums were a big fat $0 and that was for common date slabbed MS62-63 Libs and Saints. RGDS!
I just watched a 1924 PCGS Saint ms64+ hammer for $2,199. A very nice no toning coin. Very very close to a 65.
I thought that was about $200 less than a couple of months ago.. I might have bought it but I prefer solid 65's.
Also, I'm wondering if the tippy top of gold might have been reached on this recent bull the last month.
@blitzdude said:
I'm certainly not buying at the moment. The DE premiums have been inflated for several years now. I haven't purchased any since around 2018-19. At that time premiums were a big fat $0 and that was for common date slabbed MS62-63 Libs and Saints. RGDS!
Can you give a specific example of the overpricing you see on Liberty's or Saints ? I saw a bit with the quasi-numismatics like commons in MS-65 and above. But nothing really egregious in lower grades.
Keep in mind it's possible we MAY have expanded the collector base during Covid with all the keyboard buyers. And unlike crypto, Bitcoin, NFTs, etc....we didn't collapse.
Here's a low-60's premium chart that may be of interest:
@roadrunner said:
Generic $20's are really starting to expand in premiums. $20 Libs in 62 and 63 are beyond red hot nuclear. 63-64 Saints have closed much of the gap that they lost since December.
roadrunner
Premiums for Double Eagles often lead the gold move up by a substantial amount. Dealers like to front-run the price.
What the Heck? Why are you dragging forward my quote from May 12th 2010 when gold was in the $1200-$1245 range?
That was a totally different time. Premiums did expand on that wild run to $1923 gold and $50 silver. But in the following years most of those $20 Saint/Lib premiums to spot have been crushed. We will probably never see those kinds of premiums again from 2010-2011 and earlier. The only real movement in premiums have been in more "collector" type bullionesque coins like MS63/64 $5/$10 Libs. MS65 $20 Libs and MS 66 Saints have managed to hold on to decent premiums to spot. But common dated MS65 Saints and MS64 $20 Libs and lower grades are pretty much "bullion" led coins today.
One exception to the above were the US American Gold Eagle Proof coins in mint packaging. Those were beat down to only around 5-15% above spot around 4 yrs ago when gold was floundering in the $1150-$1375 range from 2016-mid 2019. They were bringing around the same prices as MS64 Saints. Now the 1 oz AGE proofs bring a $800 (40%) premium to spot, leaving the MS64 Saints well behind.
@roadrunner said:
What the Heck? Why are you dragging forward my quote from May 12th 2010 when gold was in the $1200-$1245 range?
RR, I was actually complimentary of your post and when I went over this thread I though the chart above would be useful so I naturally linked it to a post talking about premiums. I didn't mean to imply it was overriding your post or correcting it or whatever.
Just a chart on premiums linked to a post on premiums. That's it !
@roadrunner said:
That was a totally different time. Premiums did expand on that wild run to $1923 gold and $50 silver. But in the following years most of those $20 Saint/Lib premiums to spot have been crushed. We will probably never see those kinds of premiums again from 2010-2011 and earlier.
You could be right, RR. But those premiums which were so high then were actually LOWER than what we saw in the 1980's Coin Bubble. So ya never know....
The only real movement in premiums have been in more "collector" type bullionesque coins like MS63/64 $5/$10 Libs. MS65 $20 Libs and MS 66 Saints have managed to hold on to decent premiums to spot. But common dated MS65 Saints and MS64 $20 Libs and lower grades are pretty much "bullion" led coins today.
No argument. MS-65 Saints (not familiar as much with MS-64 Libs) are about 15-25% above bullion, total all-in costs, depending on the coin's specific appearance and attributes. This is based on what I have seen on GC and HA.
One exception to the above were the US American Gold Eagle Proof coins in mint packaging. Those were beat down to only around 5-15% above spot around 4 yrs ago when gold was floundering in the $1150-$1375 range from 2016-mid 2019. They were bringing around the same prices as MS64 Saints. Now the 1 oz AGE proofs bring a $800 (40%) premium to spot, leaving the MS64 Saints well behind.
Interesting, I last bought Proof AGEs at FUN 2020 and the price did seem cheap. Not sure I bought the bottom but I would appear to have gotten a decent price. MS-63 commons like my 1915-S were cheap, that's for sure.
Dollar cost averaging every month, no matter the price. A floor is being built around $2,000 USD. In 2002 with gold at ca. $300, people thought they were overpaying. $1,900-$2,000 USD level is becoming a floor and launch pad for higher prices IMHO.
Dollar cost averaging every month, no matter the price. A floor is being built around $2,000 USD. In 2002 with gold at ca. $300, people thought they were overpaying. $1,900-$2,000 USD level is becoming a floor and launch pad for higher prices IMHO.
+1
That's what it looks like to me as well. Apparently, gold has been climbing in almost every other currency. Now that the dollar is under assault as the world's reserve currency, you might think of the dollar as having established a glass ceiling, rather than the price of gold as having established a base.
The gross mismanagement, deceit and corruption continues on a massive scale. Do what you can to mitigate it.
Premiums on bullion have begun to rise again. That's evident in the current BST listings. The Austrian Mint is on allocation, the Canadian Mint has had to cut back on its in-house orders because they "over-committed" on deliveries. Delivery times are being extended on silver bullion.
The Saudis are cutting back production and France is buying oil with yuan. A thousand cuts, and it all adds up.
Q: Are You Printing Money? Bernanke: Not Literally
@inkdiver said:
Dollar cost averaging every month, no matter the price. A floor is being built around $2,000 USD. In 2002 with gold at ca. $300, people thought they were overpaying. $1,900-$2,000 USD level is becoming a floor and launch pad for higher prices IMHO.
Yes, the next $1,000 is UP and not down. But it could take years to get to my target of $3,000/oz. and a bit longer to hit $5,000/oz.
It's coming. Folks will talk about being able to get common generic Saints for $2,200 in MS-65 in the future like we marvel at folks getting them for $600 decades ago.
Gold's rise has NOTHING to do with the status of the dollar, except as it makes foreign currencies buy a bit more.
This is a supply/demand imbalance in its EARLY stages. Gold mining has increased in costs (check out the destruction of shareholder value the last 15 years) but demand increases. Every day, 10,000 more people globally become wealthier and able to purchase a small quantity of gold.
SWFs, CBs, and institutions are no longer big sellers.
I agree that $2,000 will eventually (but not right now) be seen as a major support/floor like the low-$1,000's used to be.
Gold's rise is highly correlated to the declining value of the dollar. We discussed that high correlation in another thread already. It's a high enough correlation that even an accountant or a banker can't ignore it.
The status of the dollar as the world's reserve currency is being eroded continuously by the massive overspending by Congress and irresponsible money creation by the Fed.
The reserve requirements should never have been allowed to go to zero, and the bankers who couldn't figure out how to hedge against an increase in interest rates should be out of a job and their banks should have failed. End of story.
But, instead the corruption in banking takes precedence over good governance as usual.
Q: Are You Printing Money? Bernanke: Not Literally
@jmski52 said:
Gold's rise is highly correlated to the declining value of the dollar. We discussed that high correlation in another thread already. It's a high enough correlation that even an accountant or a banker can't ignore it.
Could you please share the link of the thread mentioned?
@inkdiver : The thread is “Financial system collapse” - derryb provided the highly significant stats that show a very strong statistical inverse relationship between the strength of the dollar and the price of gold.
When anyone states that “gold’s rise has nothing to do with the status of the dollar” they are intentionally ignoring the fact that there is a very strong inverse relationship between the strength of the dollar and the price of gold - in order to divert attention away from the Fed’s manipulative moves via high interest rates that are destroying the medium-sized regional banks with the intention of consolidating the banking system before a central bank digital currency can be implemented.
Don’t be fooled by the central banking cheerleaders here. Yellen has already made it clear that only certain banks where certain priviledged wealthy people have their money will be protected from their bank’s gross mismanagement of interest rate risk, and everyone else gets their taxes raised to pay for it.
It’s a corrupt banking system from the top down, and it sorely needs sunlight.
Q: Are You Printing Money? Bernanke: Not Literally
What the people in that thread mistake is using the USD index as a valuation of the dollar. As many have pointed out, that's just the value of the USD relative to other currencies. It's possible for the USD to outperform the other currencies and for gold to increase in USD terms at the same time. The reality is that every value/price is a trading pair. If you sell your gold for USD, you are taking a long USD position. If you sell your USD for gold, you are taking a long gold position.
Renowned economist Mohamed El-Erian: “I fear that this may well end up being the biggest Fed policy mistake in several decades. The Fed’s problems should worry everyone. A loss of credibility directly affects its ability to maintain financial stability and guide markets in a manner consistent with its dual mandate of maintaining price stability and supporting maximum employment.”
Remember, faith in the currency and those that manage it is what keeps a currency "alive." It is the only thing, besides a military, that backs all fiat currencies. As currencies rot, precious metals become da bomb. Unfortunately PM holders such as ourselves are also prisoners of the dollar trade and will share in any failure or decline of the currency.
"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
@jmski52 said: @inkdiver : The thread is “Financial system collapse” - derryb provided the highly significant stats that show a very strong statistical inverse relationship between the strength of the dollar and the price of gold.
When anyone states that “gold’s rise has nothing to do with the status of the dollar” they are intentionally ignoring the fact that there is a very strong inverse relationship between the strength of the dollar and the price of gold - in order to divert attention away from the Fed’s manipulative moves via high interest rates that are destroying the medium-sized regional banks with the intention of consolidating the banking system before a central bank digital currency can be implemented.
Don’t be fooled by the central banking cheerleaders here. Yellen has already made it clear that only certain banks where certain priviledged wealthy people have their money will be protected from their bank’s gross mismanagement of interest rate risk, and everyone else gets their taxes raised to pay for it.
It’s a corrupt banking system from the top down, and it sorely needs sunlight.
It's the embodiment of the Golden Rule . . . . . . He who has the gold makes the rules.
@ProofCollection said:
There's a technical target for the next move on the Weekly timeframe of $2900-3000 which would probably hit in the next 1-2 years.
That's EXTREMELY aggressive and would imply something major like a global incident or collapse in the dollar or crypto with $$$ going to gold.
I hope you are wrong, I won't have all my Saints and Liberty Heads by then !
Gold matching S&P 500 over last 20-23 years. But it's not an apples-to-apples comparision because it is coming from a low base and not rolling time period.
As far as gold and the USD not being correlated, check out the various charts by Rambus in this 321gold.com article. And as a rule over the past 20 yrs, they've had some of the very best charting.
It's pretty clear that gold and USD are correlated to around 85-95% longer term. An interesting grouping of charts to support the notion that gold could be priming the pump for another longer term run much like 1999-2011. If 2016 started the run then it's 7 yrs into the current run. The 1962 to 1980 run lasted 18 yrs with the final strongest move from 1971-1980. Rambus' expectations of a USD drop still has to get by any bail outs in a potential banking crisis....similar to the pay outs in 2008-2009. Who figured that was going to happen then with the CB's back-stopping most of the losing MBS and CDS bets by the TBTF banks? This time it could be worse if IRS (interest rate swaps) start failing in quantity as they make up 80% of the total $630 TRILL of world-wide derivatives. Any of that could "delay" the dollar breaking below its H&S pattern.
Rambus has the same idea i do as far as the Gold to Silver ratio chart. It has a date with getting back to the 45-55 range, if not lower. The current 2021-2026 "war cycle" has certainly made gold and dollar chart predicting a lot more tenuous. Rambus' charts have generally tracked gold well the past 20+ yrs. ....but not always. Despite what the gold chart seemed to indicate back in 2014-2015 Rambus was on the wrong side of the gold trades for about a year and completely blew up all the profits they had made on gold's drop from 2011-2013.....trying to trade the whipsaws of 2014-2015. It's one thing to have a pretty chart. It's another thing to be able to trade on it accurately. His big picture charts seem to mostly pan out. The short term is another story.
@GoldFinger1969 said:
CNBC talking about gold last few days.
Gold matching S&P 500 over last 20-23 years. But it's not an apples-to-apples comparision because it is coming from a low base and not rolling time period.
Just based on the index values gold has out-performed the S&P 500 by approx 2.5 to 3x since the 2000 SM peak. This of course negates benefit via dividends and that stock laggards end of being kicked off the S&P index. Gold never changes though still gets compared to ever-changing apples/oranges. This chart is taken from the Rambus article I linked in my prior post. Rather than look at the past 22 yrs, out performance of gold in those first 11 yrs (11X the S&P "gain") followed by gold's under performance from 2011-2021. So what's the next 11 yr cycle going to hold for gold vs S&P ?
One thing I've learned from Rambus watching his charts for about 15 yrs. Don't get too tied up in the "whys" of the world which might cause the charts to shift. Just look at the impassionate charts, which tend to already factor in all those "whys."
We don't really need to know about crypto's, wars, economic shocks, etc.....the charts always seem to figure that into their wave forms. Rambus' 25 yr quarterly gold chart is a good example of that....showing the "2008-2009" financial crisis to only be a blip on the gold chart.
@roadrunner said:
As far as gold and the USD not being correlated, check out the various charts by Rambus in this 321gold.com article. And as a rule over the past 20 yrs, they've had some of the very best charting.
It might be a technical nitpick, but I believe you are saying gold and the USD index are correlated. As gold is commonly discussed and priced and valued in USD, you can't really have a correlation to the pricing unit (USD). That is, the price of gold in USD either goes up or it goes down. When you discuss the correlation of gold to the USD index, you are of course, discussing the correlation of gold priced in USD relative to the basket of currencies the comprise the index. Doing that introduces all of the complexities involved with other national currencies.
An often-cited metric or statement is that an ounce of gold has pretty much always bought a nice suit, so if you were to chart the price of gold in suits it would be pretty flat line.
@roadrunner said:
As far as gold and the USD not being correlated, check out the various charts by Rambus in this 321gold.com article. And as a rule over the past 20 yrs, they've had some of the very best charting.
It might be a technical nitpick, but I believe you are saying gold and the USD index are correlated. As gold is commonly discussed and priced and valued in USD, you can't really have a correlation to the pricing unit (USD). That is, the price of gold in USD either goes up or it goes down. When you discuss the correlation of gold to the USD index, you are of course, discussing the correlation of gold priced in USD relative to the basket of currencies the comprise the index. Doing that introduces all of the complexities involved with other national currencies.
An often-cited metric or statement is that an ounce of gold has pretty much always bought a nice suit, so if you were to chart the price of gold in suits it would be pretty flat line.
Which is basically exactly what I stated a couple weeks back here, including the currencies that make up the index and their individual tendencies, esp. the AUD and CDN which are commodity-based nations.
I did mean to say "not correlated" as this post was a counter-point to those that say there is no correlation or the correlation is a perfect 1-1 always......neither of which is true. I was also pointing the Rambus' charts which show gold against numerous currencies, markets, etc. All important info. In short, all I meant to say was check out HIS charts and then analyze what you see and what it means. I was only pointing towards the charts in play.
Yes, the US dollar index is well correlated the price movements in gold bullion. So you're right about the USDollar being a misnomer when it really is a basket of "other" currencies heavily weighted to the Euro and JPY. It's biggest direct correlation is "faith in govt's - currency, economy, military" barring the usual manipulation by bullion banks, the FED, Bank of London, and other major players. Gold's response can be delayed. But, it's never removed. Eventually it catches up.
@cohodk said:
Your chart shows a lifetime of underperformance.
An understated underperformance as you noted.
In a few months or a couple years that 50 yr chart will be flat across from the start to end......flat performance of gold to S&P over a 45 year "life time." Soon to be followed by gold over-performance over a "life time." Maybe that's your life time, I've been in the financial markets since the mid-1960's. Personally, I don't define "life time" by a mere 50 yr period. Clearly gold over-performed from 1966 to 1980, And then again 1999-2011. And left off of your reply was that gold wasn't even allowed to float against the USD until 1971. And wasn't even buyable by the US public until Dec 1974. So basically a fixed gold price from 1934 to 1971. It's sheer lunacy to be on the wrong 11 yr cycle....especially as a 80-120 super cycle (inflationary) is coming to a final head.
For those retiring on the wrong end of SM which 11 yr rally is in play makes a HUGE difference. Another 11 rally on the gold side and that 50 yr "life time" will be on gold's side. Oops. Don't say that to the brain-washed SM faithful. Heck, wait until the stock market returns to the 4th wave triangle (1998-2016) similar to great depression performance. The words you say now sound like someone back in 1926-1928. How do you think they felt in the 1930's after being wiped out. Is it enough for them to say: "well chaps, we had a great 1920's....lol." Advisors always say to hold on for the "long term." It's not their money at risk.
Stocks didn't pass the 1929 peak until 25 yrs later in 1954.....HALF a Lifetime. Assuming you didn't get wiped out for a lifetime in 1929-1932. Many never recovered no matter how many decades followed. History repeats. And that part hasn't yet repeated. And I think it will in these next 10 yrs. Markets always correct. And the longer they go on the bigger they correct. Where are your own charting/predictions for the next 10 yrs? As I always say around here.......the shorter the forum reply, the less that person has to offer.....consistently.
Comments
A sign that the comex is becoming obsolete in the world of real PMs? lol
"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
As long as a comex contracts are redeemable for physical the comex is still the way bulk buyers do business.
The bulk buyers (consumers and fabricators who actually use the metal) as well as suppliers (miners) are at the mercy of the speculators and the bullion banks who typically never redeem yet control the pricing mechanism to facilitate their profiting on the volatility that they create. Fortunately for the bulk buyers they have for years enjoyed the benefit of buying at suppressed prices, while the suppliers have suffered through the same suppressed prices. I see the tables turning, slowly but surely.
"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
for all the complaints about how much paper is traded, only 3,273,200 gold ounces were delivered on the August 2020 contract. that's 32,732 contracts. volume on the december 2020 contract was 279,319 today. I have a feeling if the entire maximum open interest for a particular month were to be delivered that the comex may be short but they could get the member firms to buy it from suppliers as they did to replenish this most recent crisis. One thing to remember when complaining about the amount which could be demanded is that the comex pairs buyers of contracts to sellers of the contracts. the comex is not the actual counter-party to the futures contract. in short the seller of the contract would be on the hook for delivery.
https://www.cmegroup.com/trading/metals/precious/gold_quotes_volume_voi.html?optid=437#tradeDate=20200731
Time to dust off this thread again. Close enough...
Premiums for Double Eagles often lead the gold move up by a substantial amount. Dealers like to front-run the price.
Is that manipulation?
Knowledge is the enemy of fear
They can ask whatever they want for a coin. We can choose to buy or not buy.
Not arguing with that, but in questioning your comment of dealers frontrunning.
So your saying it's OK for dealers (in a coordinated effort) to push prices higher then unload on the retail buyers?
Isn't front running illegal and unethical in equity markets?
Knowledge is the enemy of fear
" Is that manipulation? "
Perhaps... I tend to think it as part of the price discovery process. Happens quite frequently, like with new cars, etc. Even quite a few here on the forum.... when buying from the the US Mint (or VaultBox! ) then pushing to see what it can be flipped for!
No, I'm saying they are frontrunning future price increases for gold. Not illegally frontrunning someone else's preferential trade order.
If Double Eagles trade at a 50% premium to spot gold for a certain grade...and then gold takes off....and there is talk that it's a new multi-year bull market with gold about to double or triple in price....it stands to reason that they would frontrun, or mor accurately DISCOUNT, future big increases in the price of gold.
The problem is...if the price of gold doesn't rise....the ask prices for DEs are ridiculous. Dealers will hold out and then prices will fall rapidly (prices are sticky to the downside).
Absolutely. This form of frontrunning -- discounting -- is about expected or future increases in the price of gold bullion which may -- or may NOT !!! -- materialize.
That's what I meant. Sorry for my sloppiness.
These are coins not equities. And are you sure it's coordinated?
If I hear a news story that makes me think the price of beef is about to double and I go load up on steaks, isn't that just speculation? If I'm a store that sells beef and I buy a few extra cows, again, I'm not sure that kind of speculation is illegal or unethical. It's classical speculation that may or may not work out for me.
Are they just coins to the retail buyer?
Knowledge is the enemy of fear
My point was.....you have a dead period in bullion and coins....then bullion takes off...folks disbelieve at first...then it keeps going higher....then the coin people raise the prices not only to catch up but also to ANTICIPATE future increases which MAY or MAY NOT materialize.
At some point they raise too high and too fast and bullion doesn't go up more. That happened in 2007, 2011, and 2020. When it does, coins eventually take a bigger hit because AT FIRST the dealers are reluctant to cut prices (especially if they paid up for it in the first place).
Everyone is ALWAYS afraid of UNDERPRICING because gold will go up 10-20 fold like it did in the 1970's.
Exactly. They certainly are NOT afraid of overpricing, hence inflated premiums. Good to see we are resolving the "why are premiums so high?" question.
Knowledge is the enemy of fear
I'm certainly not buying at the moment. The DE premiums have been inflated for several years now. I haven't purchased any since around 2018-19. At that time premiums were a big fat $0 and that was for common date slabbed MS62-63 Libs and Saints. RGDS!
The whole worlds off its rocker, buy Gold™.
I just watched a 1924 PCGS Saint ms64+ hammer for $2,199. A very nice no toning coin. Very very close to a 65.
I thought that was about $200 less than a couple of months ago.. I might have bought it but I prefer solid 65's.
Also, I'm wondering if the tippy top of gold might have been reached on this recent bull the last month.
Gold $2000, palladium $1330.
Quite a reversal from the last few years.
My Adolph A. Weinman signature
as the saying goes close enough counts only in horseshoes and hand grenades.
Can you give a specific example of the overpricing you see on Liberty's or Saints ? I saw a bit with the quasi-numismatics like commons in MS-65 and above. But nothing really egregious in lower grades.
Keep in mind it's possible we MAY have expanded the collector base during Covid with all the keyboard buyers. And unlike crypto, Bitcoin, NFTs, etc....we didn't collapse.
Here's a low-60's premium chart that may be of interest:
Josh Brown on CNBC said he expected mid-2000's for gold....and he's a stock guy who never talks PMs.
VERY good sign.
What the Heck? Why are you dragging forward my quote from May 12th 2010 when gold was in the $1200-$1245 range?
That was a totally different time. Premiums did expand on that wild run to $1923 gold and $50 silver. But in the following years most of those $20 Saint/Lib premiums to spot have been crushed. We will probably never see those kinds of premiums again from 2010-2011 and earlier. The only real movement in premiums have been in more "collector" type bullionesque coins like MS63/64 $5/$10 Libs. MS65 $20 Libs and MS 66 Saints have managed to hold on to decent premiums to spot. But common dated MS65 Saints and MS64 $20 Libs and lower grades are pretty much "bullion" led coins today.
One exception to the above were the US American Gold Eagle Proof coins in mint packaging. Those were beat down to only around 5-15% above spot around 4 yrs ago when gold was floundering in the $1150-$1375 range from 2016-mid 2019. They were bringing around the same prices as MS64 Saints. Now the 1 oz AGE proofs bring a $800 (40%) premium to spot, leaving the MS64 Saints well behind.
RR, I was actually complimentary of your post and when I went over this thread I though the chart above would be useful so I naturally linked it to a post talking about premiums. I didn't mean to imply it was overriding your post or correcting it or whatever.
Just a chart on premiums linked to a post on premiums. That's it !
You could be right, RR. But those premiums which were so high then were actually LOWER than what we saw in the 1980's Coin Bubble. So ya never know....
No argument. MS-65 Saints (not familiar as much with MS-64 Libs) are about 15-25% above bullion, total all-in costs, depending on the coin's specific appearance and attributes. This is based on what I have seen on GC and HA.
Interesting, I last bought Proof AGEs at FUN 2020 and the price did seem cheap. Not sure I bought the bottom but I would appear to have gotten a decent price. MS-63 commons like my 1915-S were cheap, that's for sure.
Dollar cost averaging every month, no matter the price. A floor is being built around $2,000 USD. In 2002 with gold at ca. $300, people thought they were overpaying. $1,900-$2,000 USD level is becoming a floor and launch pad for higher prices IMHO.
Dollar cost averaging every month, no matter the price. A floor is being built around $2,000 USD. In 2002 with gold at ca. $300, people thought they were overpaying. $1,900-$2,000 USD level is becoming a floor and launch pad for higher prices IMHO.
+1
That's what it looks like to me as well. Apparently, gold has been climbing in almost every other currency. Now that the dollar is under assault as the world's reserve currency, you might think of the dollar as having established a glass ceiling, rather than the price of gold as having established a base.
The gross mismanagement, deceit and corruption continues on a massive scale. Do what you can to mitigate it.
Premiums on bullion have begun to rise again. That's evident in the current BST listings. The Austrian Mint is on allocation, the Canadian Mint has had to cut back on its in-house orders because they "over-committed" on deliveries. Delivery times are being extended on silver bullion.
The Saudis are cutting back production and France is buying oil with yuan. A thousand cuts, and it all adds up.
I knew it would happen.
Yes, the next $1,000 is UP and not down. But it could take years to get to my target of $3,000/oz. and a bit longer to hit $5,000/oz.
It's coming. Folks will talk about being able to get common generic Saints for $2,200 in MS-65 in the future like we marvel at folks getting them for $600 decades ago.
Gold's rise has NOTHING to do with the status of the dollar, except as it makes foreign currencies buy a bit more.
This is a supply/demand imbalance in its EARLY stages. Gold mining has increased in costs (check out the destruction of shareholder value the last 15 years) but demand increases. Every day, 10,000 more people globally become wealthier and able to purchase a small quantity of gold.
SWFs, CBs, and institutions are no longer big sellers.
I agree that $2,000 will eventually (but not right now) be seen as a major support/floor like the low-$1,000's used to be.
Gold's rise is highly correlated to the declining value of the dollar. We discussed that high correlation in another thread already. It's a high enough correlation that even an accountant or a banker can't ignore it.
The status of the dollar as the world's reserve currency is being eroded continuously by the massive overspending by Congress and irresponsible money creation by the Fed.
The reserve requirements should never have been allowed to go to zero, and the bankers who couldn't figure out how to hedge against an increase in interest rates should be out of a job and their banks should have failed. End of story.
But, instead the corruption in banking takes precedence over good governance as usual.
I knew it would happen.
Could you please share the link of the thread mentioned?
Shhhhh. Don't tell anyone I told you guys , but the dumbing down is in full swing. It's a rare few who capitalize on opportunity.
@inkdiver : The thread is “Financial system collapse” - derryb provided the highly significant stats that show a very strong statistical inverse relationship between the strength of the dollar and the price of gold.
When anyone states that “gold’s rise has nothing to do with the status of the dollar” they are intentionally ignoring the fact that there is a very strong inverse relationship between the strength of the dollar and the price of gold - in order to divert attention away from the Fed’s manipulative moves via high interest rates that are destroying the medium-sized regional banks with the intention of consolidating the banking system before a central bank digital currency can be implemented.
Don’t be fooled by the central banking cheerleaders here. Yellen has already made it clear that only certain banks where certain priviledged wealthy people have their money will be protected from their bank’s gross mismanagement of interest rate risk, and everyone else gets their taxes raised to pay for it.
It’s a corrupt banking system from the top down, and it sorely needs sunlight.
I knew it would happen.
Here is the link. https://forums.collectors.com/discussion/1088840/financial-system-collapse-wall-street-stocks
What the people in that thread mistake is using the USD index as a valuation of the dollar. As many have pointed out, that's just the value of the USD relative to other currencies. It's possible for the USD to outperform the other currencies and for gold to increase in USD terms at the same time. The reality is that every value/price is a trading pair. If you sell your gold for USD, you are taking a long USD position. If you sell your USD for gold, you are taking a long gold position.
Congrats to gold at $2025+.
.> @GoldFinger1969 said:
LOL
FED has lost credibility
Renowned economist Mohamed El-Erian: “I fear that this may well end up being the biggest Fed policy mistake in several decades. The Fed’s problems should worry everyone. A loss of credibility directly affects its ability to maintain financial stability and guide markets in a manner consistent with its dual mandate of maintaining price stability and supporting maximum employment.”
Remember, faith in the currency and those that manage it is what keeps a currency "alive." It is the only thing, besides a military, that backs all fiat currencies. As currencies rot, precious metals become da bomb. Unfortunately PM holders such as ourselves are also prisoners of the dollar trade and will share in any failure or decline of the currency.
"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
It's the embodiment of the Golden Rule . . . . . . He who has the gold makes the rules.
Coinlearner, Ahrensdad, Nolawyer, RG, coinlieutenant, Yorkshireman, lordmarcovan, Soldi, masscrew, JimTyler, Relaxn, jclovescoins
Now listen boy, I'm tryin' to teach you sumthin' . . . . that ain't an optical illusion, it only looks like an optical illusion.
My mind reader refuses to charge me....
The Old Man rises again.
Canadian dollars..............
Au.....$2718.00
Ag.......$33.58
Now come on Platinum......
"“Those who sacrifice liberty for security/safety deserve neither.“(Benjamin Franklin)
"I only golf on days that end in 'Y'" (DE59)
It just doesn't compare to oil , eggs, or Bitcoin.
$2020.... Any predictions for this month?? Will $2K become the new floor?? Cheers, RickO
Longer-term, I have been predicting $3,000 by 2030....with an outside shot at $5,000 by 2035.
There's a technical target for the next move on the Weekly timeframe of $2900-3000 which would probably hit in the next 1-2 years.
That's EXTREMELY aggressive and would imply something major like a global incident or collapse in the dollar or crypto with $$$ going to gold.
I hope you are wrong, I won't have all my Saints and Liberty Heads by then !
CNBC talking about gold last few days.
Gold matching S&P 500 over last 20-23 years. But it's not an apples-to-apples comparision because it is coming from a low base and not rolling time period.
As far as gold and the USD not being correlated, check out the various charts by Rambus in this 321gold.com article. And as a rule over the past 20 yrs, they've had some of the very best charting.
https://rambus1.com/2023/04/09/weekend-report-precious-metals-complex-happy-days-are-here-again/
It's pretty clear that gold and USD are correlated to around 85-95% longer term. An interesting grouping of charts to support the notion that gold could be priming the pump for another longer term run much like 1999-2011. If 2016 started the run then it's 7 yrs into the current run. The 1962 to 1980 run lasted 18 yrs with the final strongest move from 1971-1980. Rambus' expectations of a USD drop still has to get by any bail outs in a potential banking crisis....similar to the pay outs in 2008-2009. Who figured that was going to happen then with the CB's back-stopping most of the losing MBS and CDS bets by the TBTF banks? This time it could be worse if IRS (interest rate swaps) start failing in quantity as they make up 80% of the total $630 TRILL of world-wide derivatives. Any of that could "delay" the dollar breaking below its H&S pattern.
Rambus has the same idea i do as far as the Gold to Silver ratio chart. It has a date with getting back to the 45-55 range, if not lower. The current 2021-2026 "war cycle" has certainly made gold and dollar chart predicting a lot more tenuous. Rambus' charts have generally tracked gold well the past 20+ yrs. ....but not always. Despite what the gold chart seemed to indicate back in 2014-2015 Rambus was on the wrong side of the gold trades for about a year and completely blew up all the profits they had made on gold's drop from 2011-2013.....trying to trade the whipsaws of 2014-2015. It's one thing to have a pretty chart. It's another thing to be able to trade on it accurately. His big picture charts seem to mostly pan out. The short term is another story.
Just based on the index values gold has out-performed the S&P 500 by approx 2.5 to 3x since the 2000 SM peak. This of course negates benefit via dividends and that stock laggards end of being kicked off the S&P index. Gold never changes though still gets compared to ever-changing apples/oranges. This chart is taken from the Rambus article I linked in my prior post. Rather than look at the past 22 yrs, out performance of gold in those first 11 yrs (11X the S&P "gain") followed by gold's under performance from 2011-2021. So what's the next 11 yr cycle going to hold for gold vs S&P ?
One thing I've learned from Rambus watching his charts for about 15 yrs. Don't get too tied up in the "whys" of the world which might cause the charts to shift. Just look at the impassionate charts, which tend to already factor in all those "whys."
We don't really need to know about crypto's, wars, economic shocks, etc.....the charts always seem to figure that into their wave forms. Rambus' 25 yr quarterly gold chart is a good example of that....showing the "2008-2009" financial crisis to only be a blip on the gold chart.
=
Your chart shows a lifetime of underperformance.
An understated underperformance as you noted.
Knowledge is the enemy of fear
It might be a technical nitpick, but I believe you are saying gold and the USD index are correlated. As gold is commonly discussed and priced and valued in USD, you can't really have a correlation to the pricing unit (USD). That is, the price of gold in USD either goes up or it goes down. When you discuss the correlation of gold to the USD index, you are of course, discussing the correlation of gold priced in USD relative to the basket of currencies the comprise the index. Doing that introduces all of the complexities involved with other national currencies.
An often-cited metric or statement is that an ounce of gold has pretty much always bought a nice suit, so if you were to chart the price of gold in suits it would be pretty flat line.
Which is basically exactly what I stated a couple weeks back here, including the currencies that make up the index and their individual tendencies, esp. the AUD and CDN which are commodity-based nations.
I did mean to say "not correlated" as this post was a counter-point to those that say there is no correlation or the correlation is a perfect 1-1 always......neither of which is true. I was also pointing the Rambus' charts which show gold against numerous currencies, markets, etc. All important info. In short, all I meant to say was check out HIS charts and then analyze what you see and what it means. I was only pointing towards the charts in play.
Yes, the US dollar index is well correlated the price movements in gold bullion. So you're right about the USDollar being a misnomer when it really is a basket of "other" currencies heavily weighted to the Euro and JPY. It's biggest direct correlation is "faith in govt's - currency, economy, military" barring the usual manipulation by bullion banks, the FED, Bank of London, and other major players. Gold's response can be delayed. But, it's never removed. Eventually it catches up.
In a few months or a couple years that 50 yr chart will be flat across from the start to end......flat performance of gold to S&P over a 45 year "life time." Soon to be followed by gold over-performance over a "life time." Maybe that's your life time, I've been in the financial markets since the mid-1960's. Personally, I don't define "life time" by a mere 50 yr period. Clearly gold over-performed from 1966 to 1980, And then again 1999-2011. And left off of your reply was that gold wasn't even allowed to float against the USD until 1971. And wasn't even buyable by the US public until Dec 1974. So basically a fixed gold price from 1934 to 1971. It's sheer lunacy to be on the wrong 11 yr cycle....especially as a 80-120 super cycle (inflationary) is coming to a final head.
For those retiring on the wrong end of SM which 11 yr rally is in play makes a HUGE difference. Another 11 rally on the gold side and that 50 yr "life time" will be on gold's side. Oops. Don't say that to the brain-washed SM faithful. Heck, wait until the stock market returns to the 4th wave triangle (1998-2016) similar to great depression performance. The words you say now sound like someone back in 1926-1928. How do you think they felt in the 1930's after being wiped out. Is it enough for them to say: "well chaps, we had a great 1920's....lol." Advisors always say to hold on for the "long term." It's not their money at risk.
Stocks didn't pass the 1929 peak until 25 yrs later in 1954.....HALF a Lifetime. Assuming you didn't get wiped out for a lifetime in 1929-1932. Many never recovered no matter how many decades followed. History repeats. And that part hasn't yet repeated. And I think it will in these next 10 yrs. Markets always correct. And the longer they go on the bigger they correct. Where are your own charting/predictions for the next 10 yrs? As I always say around here.......the shorter the forum reply, the less that person has to offer.....consistently.