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Watch Out: ASE Premium Can Disappear
tneig
Posts: 1,505 ✭✭✭
In this article: Article Linky, it describes the possiblity of lowered premiums on ASE's because of the shear number minted...
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In the present market, silver Eagle buyers are paying a premium over silver value to obtain these silver Eagles. Unless buyers have a lot of experience, they might not be aware of the possibility that the premium they are paying can decline or disappear, which might cost them some of their gains when they go to sell.
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Timing is everything.
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In the present market, silver Eagle buyers are paying a premium over silver value to obtain these silver Eagles. Unless buyers have a lot of experience, they might not be aware of the possibility that the premium they are paying can decline or disappear, which might cost them some of their gains when they go to sell.
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Timing is everything.
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Comments
10 oz bars and 1 oz bars/rounds have been my staple.
<< <i>10 oz bars and 1 oz bars/rounds have been my staple
not a bad idea
Silver eagles will continue to have the highest premium as long as they remain the most desirable form of silver to stack. I do not see this changing as long as the silver bull market trend continues. Premium will never "disappear" as long as physical is more desirable than paper. Remember, spot price is based on paper and the premium is what buyers are willing to pay over spot for a particular physical product.
Any declines in ASE premiums will be met equally or greater with less demanded forms of physical and it will be strictly because sellers have come to outnumber buyers. One must consider why a buyer will pay more for an ASE and will those reasons become even more important to buyers should silver continue to rise in price.
Milkspotting doesn't affect the silver weight (stacker value) of an ASE any more than does tarnish on a silver bar.
Keep an open mind, or get financially repressed -Zoltan Pozsar
Premiums on anything can disappear just ask the people selling jewelry at the local we buy gold place what they paid for their diamond ring.
Its truly a sad moment when a guy realizes the ring he paid $4000 for is worth 80$ as scrap after the store owner gets done smashing the pathetic little diamonds out of it with a hammer
<< <i>Any declines in ASE premiums will be met equally or greater with less demanded forms of physical and it will be strictly because sellers have come to outnumber buyers. >>
How true
Same holds true for the silver PAMP bars, whose premium is even greater than the ASE's. As long as the demand for both products remains high, so will the premiums.
<< <i>Think there is much enhanced value in offering an entire ASE set in a Dansco album? >>
Yes, if selling to a collector.
Keep an open mind, or get financially repressed -Zoltan Pozsar
<< <i>
<< <i>Think there is much enhanced value in offering an entire ASE set in a Dansco album? >>
Yes, if selling to a collector. >>
To a lazy collector...
JMHO.
<< <i>They were saying that when silver was $4.75 and eagles were $6.00. >>
They have declined from that quite a bit. Percentage wise that's a 25% premium at this point its closer to 10% while in dollar terms its increased to 3$
At the point when silver was 4.75 do you remember what generic rounds were selling for? If you could get generic at spot then you are in a huge hole today by buying eagles back then .
Say you bought 1000 of them for $6000 and sold them today for $33,000 you made $27,000 which sounds ok until you do the math on the generic
$6000 spent on generic rounds would get you 1263 ounces @4.75 each even selling them back of spot at $30 each today would net $37895 which put an extra $4895 in your wallet.
<< <i>
<< <i>They were saying that when silver was $4.75 and eagles were $6.00. >>
They have declined from that quite a bit. Percentage wise that's a 25% premium at this point its closer to 10% while in dollar terms its increased to 3$
At the point when silver was 4.75 do you remember what generic rounds were selling for? If you could get generic at spot then you are in a huge hole today by buying eagles back then .
Say you bought 1000 of them for $6000 and sold them today for $33,000 you made $27,000 which sounds ok until you do the math on the generic
$6000 spent on generic rounds would get you 1263 ounces @4.75 each even selling them back of spot at $30 each today would net $37895 which put an extra $4895 in your wallet. >>
As far as I can remember, generics have never sold at only spot at any time. If my memory serves me correctly...anywhere from $.25 - $.50+ above spot. It could have been more. Art Bars sold at a substantial overinflated premiums during their heydays.
Good point. Take care. jws
The premium's percentage is much more important than its dollar value when you are talking about a large number items in a rising market
If you are a long term stacker who expects prices to go up then the premium works against you because it will always fall as a percentage of spot price . It hurts you in 2 ways , it costs you in ounces you could have purchased and because of inflation the dollars purchasing power is decreasing so even if you get it back exactly its usefulness will be lower.
The higher the price goes the more you will want to cry over the extra ounces you should have bought
I did find an area where premiums sort of helped me. Back when silver was above 40 I purchased a good sized lot of burnished uncirculated ASE's for around 52$ apiece and I have been dumping them on ebay for almost exactly that price one at a time over the last few months. The 2008w's were selling for 2x spot almost when silver was 27 ish. That's a great sale in my book and it was pure dumb luck on my part .
If you want a laugh post a 2008 w with only a picture of the front on the listing and count how many minutes it takes to get a question from a buyer asking for you to email a picture of the reverse.
They never ask you to add a pic of the reverse to the listing, they always want you to email it to them.
This works with ASE proofs very well also , you can find them in pawn shops and we buy gold places in the 35$ range and flip them on ebay for $60+ buy nows all day long.
<< <i>I did find an area where premiums sort of helped me. Back when silver was above 40 I purchased a good sized lot of burnished uncirculated ASE's for around 52$ apiece and I have been dumping them on ebay for almost exactly that price one at a time over the last few months. >>
Sounds like you've made a good case for ASE premiums being worth the extra money.
Keep an open mind, or get financially repressed -Zoltan Pozsar
<< <i>
<< <i>I did find an area where premiums sort of helped me. Back when silver was above 40 I purchased a good sized lot of burnished uncirculated ASE's for around 52$ apiece and I have been dumping them on ebay for almost exactly that price one at a time over the last few months. >>
Sounds like you've made a good case for ASE premiums being worth the extra money. >>
Well those weren't regular ASE's . I only bought them because at the time I had just picked up a book that identified the 2006w as a potential good buy. I stumbled over a buy now that was for 32 mixed 2006w 2007w and 2008w and took a chance.
It hasn't been all roses incidentally as some of the coins had incomplete packaging which cuts into the sale price. I'm down to the last 2 2006w's that were missing the cheesy drawstring bags. Those bags are worth about $20 each off the sale price
would premiums on commonly available name brand bars and pours also be expected to shink in their scenario (lots of sought after silver available)???
If we are talking about ASE premiums lets stick to the bullion . People would pay nearly $50 for a 1996 ASE back when silver was in the $18-20 range. Now those are available for $40 or so without looking too hard. The guy that paid $50 , that guy is crying because he watched his key date get cheaper as spot went up.
Think about this too if they make 30 million ASE's in 2012 would you rather pay $33 for a 2012 or $33 for a 1994 ? There is no premium to speak of on the 1994 now but you can be sure that if silver drops to 6$ no one will be looking very hard for a 2012 they will be everywhere.
Knowledge is the enemy of fear
Keep an open mind, or get financially repressed -Zoltan Pozsar
I knew it would happen.
<< <i>Hogwash. It's a premium you pay for a more desired item that is returned to you when someone who desires your item more buys it from you. It is a measure of desirability. >>
Desirability changes over time. A great location today may not be tomorrow. Gold may have proven its desirability over the last 5000 years (since organized religion), yet it is still subject to massive swings in a persons lifetime.
Premiums can, and often do, kill.
Knowledge is the enemy of fear
<< <i>Hogwash. It's a premium you pay for a more desired item that is returned to you when someone who desires your item more buys it from you. It is a measure of desirability. >>
<< <i>Desirability changes over time. >>
And that is why ASE premiums have increased in dollar terms over the years.
Keep an open mind, or get financially repressed -Zoltan Pozsar
2. When (not if) the fiat US Dollar collapses, America will need a new currency. Chances are during a sudden currency crisis the Government will be as impotent as they are now. The new currency could be ASE's.
3. As such I would expect the Premiums for ASE's will rise, not fall in my opinion.
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Knowledge is the enemy of fear
<< <i>1. The American Silver Eagle is the finest 100% pure silver coin on Earth. >>
Since when ? I didnt realise Canada had stopped minting maples.
Keep an open mind, or get financially repressed -Zoltan Pozsar
I've paid premiums for limited mintage Mint Bullion issues for quite a few years now. Sometimes it really ticked me off that the premiums could be anywhere from 15% to 35% or even more.
However, my experience since the 1995-W ASE - is that the Mint really doesn't care about collectors. To that end, they will milk their customers for everything that they can squeeze outa' you.
That being the case, the worse it tends to stink, the more intrigued I am with the offering. If nobody else is buying because its so screwed up, that's when I want to have a pile of cash ready to buy. Paying the Mint's outrageous premiums has been very good to me
This year is no exception, especially with the slow economy sales are down across the board. You are a really bad shot this year if you can't pick a winner.
I knew it would happen.
(Posted AFTER the FOLLOWING post). Crazy place, this is.
I knew it would happen.
Saved for posterity.
Knowledge is the enemy of fear
<< <i>
<< <i>1. The American Silver Eagle is the finest 100% pure silver coin on Earth. >>
Since when ? I didnt realise Canada had stopped minting maples. >>
Copy of the American one.
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<< <i>
<< <i>
<< <i>1. The American Silver Eagle is the finest 100% pure silver coin on Earth. >>
Since when ? I didnt realise Canada had stopped minting maples. >>
Copy of the American one. >>
I think the silver maple was a copy of the gold maple , which came out in 1979
20 coin tube for $687 plus $16 shipping.
In God We Trust.... all others pay in Gold and Silver!
That's ~ $1.26 above spot ($31.74 bid).
The premium is still alive and kicking, on ASE's.
_Reset
<< <i>
<< <i>
<< <i>1. The American Silver Eagle is the finest 100% pure silver coin on Earth. >>
Since when ? I didnt realise Canada had stopped minting maples. >>
Copy of the American one. >>
In what way is it a copy of an American silver eagle ? A Canadian silver maple is .9999 pure as opposed to the ASE @ .999 which would make the Canadian maple the finest silver bullion coin on the planet , the ASE being an also ran at .999
<< <i>Hogwash. It's a premium you pay for a more desired item that is returned to you when someone who desires your item more buys it from you. It is a measure of desirability. >>
I was paying the premium for the 20 coin ASE tubes and it was worth it for me, I gained some piece of mind. Whenever I have sold or traded they have went quickly, you rarely have someone question the ASE's. I understood from the beginning I was losing a little profit to be on the safe side. I would hate to sell a large bar years from now and find out it had been counterfitted.
Successful card BST transactions with cbcnow, brogurt, gstarling, Bravesfan 007, and rajah 424.
Who is ready to back up the truck at this price?
seems a bit steep
$40 over spot what a bargain