Noob question. I have done a heap of reading here since finding this great forum 3 days ago - all day Saturday and all day Sunday - didn't get out of my pjs the whole weekend! LOL Maybe I have read the answer but I can't really remember. My question - is the premium over spot a static number? For example currently 1oz Kookaburras are around 23 - 25% over spot for one, a higher quantity purchase can reduce the price down to around 15%, not including freight costs. Is this premium a static figure or as silver has increased in price has the premium also increased? Do you think that there is a possibility the premiums will increase as the shine of silver glares the masses? Hope this is not too dumb a question. Cathy
Hell yes they will, there is no reason to think the Perth Mint won't do what any other business in Perth does, and that is to gouge customers for whatever they can get away with. I'm sure any other West Aussie here, would agree.
Will increase as a dollar amount, and decrease as a percentage. Look at the premium on a 1oz gold coin.
The premium as a percentage over spot has dropped in relation to the Maple, Ase & Philharmoniker over the last 3-6 months. on eBay at least.
Look at the premiums on gold coins which are much less than silver in percentage terms. In dollar terms premiums will rise but in percentage terms decline. The cost of production/fabrication of coins won't double if the price of silver doubles, hence the price of silver coins won't double and therefore the premium will have contracted. The percentage premium on Kooks was much higher 2 years ago than now. Also on the forum whenever silver price drops the premiums rise as sellers are reluctant to sell. Also deal volume reduces. Whenever silver spikes on the forum a whole swathe of new supply comes up for sale at a lower premiums temporarily.
It does bring around my point in regards to local competition though. It's not uncommon in the states to see indepenent mints offering rounds a buck or two over spot. Sure the quality of the strike might not necessarily be up to perth mint standards (although on the few rounds I have, I beg to differ) and they might not be encapsulated or stamped with a government tender mark, but it does at least offer a lot of bang for buck for the small time consumer. I don't doubt for a second that whilst PM have considerable costs in producing their coins (and as I've said many times before, I LOVE their product!), if you had even two or three stable, small time independent mints in this country offering rounds at close to spot, you'd see the premiums on Perth Mint coins drop considerably to keep pace with the competition. Until we actually GET some competition here, it's honestly hard to say.
