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Shortage of Gold possible


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this was on the Kitco site:

"The following products have been temporarily removed from our Precious Metal Store until further notice due to production and delivery delays that retailers are currently facing; 1 oz Gold bars, 1 oz Kitco Gold bars, 10 oz Gold bars, 1 oz Silver Eagles, 1 oz Silver Maples, 1 oz Silver Philharmonic coins, 1 oz Olympic Silver Maples, 100 oz Silver bars and 1 oz Palladium Maples. "

also APMEX has taken 1 oz Maple Leafs off of their site as well as other gold coin product.

Interesting that there is a "shortage" but the price has not moved very much????????

Ken

BillA Offline

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Re: Central Banks Stop Selling Gold ( 14:16:34 WedOct 1 2008 )

Here's something interesting about the squeeze on gold and prices don't seem to match. Thought you fellows would like to see. There's more on this at

http://bb.bbboy.net/alaskagoldforum-viewth...amp;thread=1004

Anyone here picking up on this, Wyndham

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Wyndham,

I have been following (buying and selling) mostly buying, gold and silver for over 30 years and this past year has been the most confusing time in the metals market that I have ever seen. Gold and silver prices usually go up and down in tandem and that is not the case lately. Demand is tremendous due to the current hoarding, scrap buyers are not seeing the normal amount of sellers. Dealers are reluctant to deplete their inventorys at current prices, they are holding off hoping to profit handsomely in a run up.... These are troubled times and precious metals are relatively flat for some reason. Silver seems to take the bigger hits when the market rallies. The gold to silver ratio is setting at around 70 to one when it really should be 50 or lower.

Here are some facts..........

"Abundance of Elements," on average silver occurs at 0.07 parts per million, and gold at 0.004 parts per million in the earth's crust. Thus the naturally occurring ratio is 17.5:1.

Interesting - that's not far from the last monetary ratio - 16:1 -- set when both gold and silver were still universal money in the last century.

In a time of rat holing, the rich buy gold and the middle class and lower buy more silver than gold.

This has been going on for quite a few months now as many people saw the current crisis on the horizon. There have been big buyers overseas, quietly buying up vast amounts of gold on every down turn. The price of metals is not responding to the demand, I do not think that they are being manipulated. Maybe the rubber band is being stretched and we will have a major sling shot effect.

I am at a loss to explain the eratic behavior being displayed, the precious metals market should be in a full BULL mode......

Jim

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Jim

That's what the fellows at the Alaska Gold forum were indicating a well. To me there are several possible paths this can take. one is a wait and see by the big European banks, waiting the bailout vote and the election(no comment here). The other is that they know how deep the economic problem is and that there is going to be a major restructuring of the world economy and paper won't be worth much compared to today.

The strange part is that the markets , like you say are not responding to the either real or bank made shortage of gold. The last thing could be that things work out and the hording dumps on the market after the depth of the bailout is seen and prices drop to absorb the supply.

You know that feeling when your out and about and you feel the hairs on your neck tingle for no apparent reason, or when your watching a horror movie and the blond chick is about to open the door with the boggy man behind it but yell as you might , she can't hear you. Well somethings going on that not too many people(government) seem to want to let us in on.

I don't want to belabor the point, just thought others might want to hear some of this, Wyndham

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Consider this -- platinum has dropped from around $2K to $1K per ounce. Palladium has dropped, copper has dropped and oil has dropped. Silver has dropped some, but has not gone down the toilet. Yet gold still drifts in the upper levels of the past year's prices. The most likely explanation is that actual and anticipated reduced economic activity results in less industrial consumption. The industrial use of gold is not as great as that of silver or the other mentioned resources. Right now silver seems to be the better bargain of the two. If the economy tanks and things get ugly, then either gold or silver still will have high value. No matter how this bailout legislation goes, it doesn't take a rocket scientist to see that even the best case scenario the next few years will not be a good time for unnecessary spending. IMHO many a fortune soon will be lost amongst the credit-leveraged wealthy and a lot of misery awaits the hard pressed middle and lower economic classes regardless of their credit status.

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Seems as if a lot of the online Gold coin dealers are out of stock. This worries me as I get the feeling a lot of "investors" are bailing on the stock market and buying Gold. It's good for the Gold market but could be a sign of troubles ahead for the Dollar :)

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Once the current financial fear has subsided gold could drop fast and other precious metals could shoot up. It might turn out to be a risky move to load up excessively on gold in the days and weeks just before the market corrects itself (and who knows when that will be?). But meanwhile if this drags out for months and if gold were to double, some fortunes could be made. Are you feeling lucky? IMHO the better long range commodity would be platinum. Why? Gold currently is high and platinum is low. Because if, in fact, we suffer through a multi-year year recession, when we finally emerge, there likely will be a big jump in industrial demand for platinum.

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If you look at platinium and rhodium price drops this could signal a major retreat in the auto industry, based on the use of these metals in catalytic converters. It may take awhile for this industry to get back. Oil is around $90 a barrel but gas is still $3.79 here. Kinda funny if it didn't hurt so bad that gas prices rise on oil price rise but never fall at the same rate. Does anyone remember where gas was when oil was at this level 9 months ago.

Gold is down to $882 off about $24 and platinum is up about 2.7% Well I'm just an observer, no $$$ to play, Wyndham

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One issue to think about if you are planing for increased platinum demand because of its use in catalytic converters is that catalytic converters may have a limited existence. If we ever make the transition to mostly hydrogen and or electric vehicles then catalytic converters will not be required. I know that it is a BIG if but it is somethng to consider if your time horizon is several years.

It looks like we are only 2-4 years away from introduction of this type of vehicle from several manufacturers. There are already some on the road and I am sure more to come. It may be that by the time the current economic downturn is over we will have a significant number of these vehicles.

Both electric and hydrogen vehicles suffer from the lack of fueling stations but that will change as more of these vehicle hit the road. Clearly, it will be a long time before the gasoline/diesel engine dissapears but I think its growth rate will be negative over the foreseeable future.

Ken

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