BullON said:
PMG is how we refer to ASX code PMGOLD within the mint.
PMG is how we refer to ASX code PMGOLD within the mint.
Gino said:
The thing about rationing or high premiums is that it takes pressure off the underlying wholesale market. For example if people are paying 40% premiums for silver coins when the normal is 10% premium, then $30 out of every $140 spent is going to retailers/mints as extra profits rather than buying more silver. If mints were able to keep up then of that $140, $130 would be going to buying (or bidding up the price) of silver.
Excess premiums, whether it is in coins or say PSLV, just means less ounces are being bought. That is why I don't think high premiums are anything to celebrate.
The price is driven by both the physical market and paper market, which is more dominant changes over time.
fiatphoney
New Member
Bron where is that website sharelinks.com ??? you mentioned recently on an interview about a fellow that tracked premiums of coins in 08? Thanks
Thank's for the info Bron I for one appreciate your views as an insider so to speak .
Would you not agree tho that paper is the dominant market? Say for example just as a thought exercise that just silver alone was for some unexpected reason deemed only acceptable in it's physical form as a means of trade and that all the phantom paper Silver disappeared overnight due to some sort of black swan event.
People who have an PMDS for example cant just pick up the phone and buy X amount instantly and those sorts with unallocated accounts etc cant just use their phone to "say" they actually own it, they have to physically produce it.
Now I know it's a far flung what if and an extreme example, and I am not by any means saying that the Perth Mint itself is selling more Silver on paper than what it physically holds, but there are many examples around the world of paper precious metals magically teleporting from or too certain vaults with nothing more than the push of a keyboard and a few typed lines of evidence to say that they actually exist. Literally millions of ounces that would need a convoy of armoured car's and associated security personnel to transport that don't actually happen in the real physical world.
There are various estimates out there that estimate the actual paper to physical ratio and they are not nice to think about when you consider that real people are actually being sold pieces of paper and that they consider the digits on a screen or a certificate as a value of their life's work or future investment for their family.
Bron you must have a "personal" opinion on this aspect of Precious Metals investment. You have stated that "The price is driven by both the physical market and paper market, which is more dominant changes over time." As an individual person and obviously one who has an interest in precious metals I would like you to honestly answer a question.
Q: Would you as a personal investor in precious metals trust anyone else apart from the Perth Mint if you invested solely in paper or unallocated Precious Metals ?
Sorry Bron two questions actually, And this one go's back to the statement I quoted of yours above. Q: Do you think the paper market is manipulated by able bodied self interested parties? Again I ask this with no reflection on the Perth Mint as they are not a Bank or associated with the rise and fall of the stock market etc just on your statement on the physical and paper market.
Please PM me if you do not want to state your answer publicly or even just say you decline to answer. I don't doubt your honesty at all as you have always stated your views are your own and not those of the Perth Mint but understand that others may read a lot more into your answers than what is meant.
Thanks again.
Would you not agree tho that paper is the dominant market? Say for example just as a thought exercise that just silver alone was for some unexpected reason deemed only acceptable in it's physical form as a means of trade and that all the phantom paper Silver disappeared overnight due to some sort of black swan event.
People who have an PMDS for example cant just pick up the phone and buy X amount instantly and those sorts with unallocated accounts etc cant just use their phone to "say" they actually own it, they have to physically produce it.
Now I know it's a far flung what if and an extreme example, and I am not by any means saying that the Perth Mint itself is selling more Silver on paper than what it physically holds, but there are many examples around the world of paper precious metals magically teleporting from or too certain vaults with nothing more than the push of a keyboard and a few typed lines of evidence to say that they actually exist. Literally millions of ounces that would need a convoy of armoured car's and associated security personnel to transport that don't actually happen in the real physical world.
There are various estimates out there that estimate the actual paper to physical ratio and they are not nice to think about when you consider that real people are actually being sold pieces of paper and that they consider the digits on a screen or a certificate as a value of their life's work or future investment for their family.
Bron you must have a "personal" opinion on this aspect of Precious Metals investment. You have stated that "The price is driven by both the physical market and paper market, which is more dominant changes over time." As an individual person and obviously one who has an interest in precious metals I would like you to honestly answer a question.
Q: Would you as a personal investor in precious metals trust anyone else apart from the Perth Mint if you invested solely in paper or unallocated Precious Metals ?
Sorry Bron two questions actually, And this one go's back to the statement I quoted of yours above. Q: Do you think the paper market is manipulated by able bodied self interested parties? Again I ask this with no reflection on the Perth Mint as they are not a Bank or associated with the rise and fall of the stock market etc just on your statement on the physical and paper market.
Please PM me if you do not want to state your answer publicly or even just say you decline to answer. I don't doubt your honesty at all as you have always stated your views are your own and not those of the Perth Mint but understand that others may read a lot more into your answers than what is meant.
Thanks again.
southerncross,
If you are really interested in alot more information, then read Bron's blog (goldchat). It'll save Bron having to repeat verbatim what he's said there. Yes, all metal is NOT held physically at PM... all explained in goldchat. And as for paper & leverage, etc, Jeffrey Christian has explained this in detail on financialsense, in multiple interviews, and basically what he says is, "Know what it is that you're buying, and if you want a 100% guarantee of physical, then don't buy paper."
If you are really interested in alot more information, then read Bron's blog (goldchat). It'll save Bron having to repeat verbatim what he's said there. Yes, all metal is NOT held physically at PM... all explained in goldchat. And as for paper & leverage, etc, Jeffrey Christian has explained this in detail on financialsense, in multiple interviews, and basically what he says is, "Know what it is that you're buying, and if you want a 100% guarantee of physical, then don't buy paper."
Matthew 26:14
New Member
"Bron Suchecki, who's in charge of strategy for the famed Perth Mint, is warning all precious metals investors that the next crisis will lead to heightened precious metals demand so expect shortages and mint rationing. This is exactly what happened in 2008, and the next crisis could very well be worse."
Curious statement. In 2008 the ass fell out of silver while there was a supposed physical shortage? Defies logic and economic norms.
Curious statement. In 2008 the ass fell out of silver while there was a supposed physical shortage? Defies logic and economic norms.
Matthew 26:14 said:
Not at all. This is "Precious metals 101". The problem with Bron repeating the answer here, is that in 3 weeks time, another dude will appear, and ask the exact same question. The answers have been repeated ad-nauseum on goldchat, PM blog, and lots of other quality blogs. Seek and ye shall find. In my opinion, the best favour people can do Bron (because our time is not more valauble than his) is to read his goldchat from start to end (2008 - present). I did.
southerncross said:
Certainly paper often has the upper hand, but many desk-based commentators who aren't in the markets don't realise how much physical is also traded. Blogger FOFOA has a theory that since bullion bank unallocated accounts are fractionally backed bullion bankers are particularly concerned when the physical market starts to suck out metal, draining their reserves (which if left unchecked could take too much physical and result in a bullion bank run). His theory is they push the price UP (not down) as that means the same dollars buy LESS ounces, taking pressure off their reserves. I hope this gives one example of how complex the physical vs paper dynamics can be.
Not sure I understand your point about PMDS. If we went to a physical only market then we would only sell to a PMDS client if we could get/had physical silver.
southerncross said:
It is a common misunderstanding that the ETF allocations involve physical movement. As most of them store their metal in London, all that is happening is that silver already in the vault (which belonged to someone else who sold it to a bullion bank) is just sold to the ETF authorised participant and they just change a computer record saying that bar in the vault now belongs to the ETF AP (who then transfers title to the ETF trust).
southerncross said:
It all comes down to the custodian. You either trust them or not. If you don't then not even allocated will be safe. Regarding unallocated, I don't think apart from ourselves and Kitco that there are many who explicitly state that their unallocated is 100% backed, and that is really only possible for businesses which have physical as part of their business. If you are buying unallocated from a bank, then very high chance it is being lent in some form as that is what banks do.
southerncross said:
I would not be surprised if the metals markets are manipulated, but as we are not traders in the big paper markets (eg COMEX) we don't have any evidence one way or the other. However I don't believe the metals markets are suppressed, which I distinguish from manipulation (which is short term). Suppressed means the price is kept lower over a number of years. Those who think this way don't appreciate (or is that respect) the power of the physical market, by which I mean to suppress you ultimately have to supply physical to the market and there is only so much above ground in the hands of the central bankers.
Black_Sun said:
To clarify, unallocated is backed by physical in our operations in Perth, but also by some physical in transit and temporarily sitting in overseas warehouses on its way to distributors, and by a bit of unallocated held with bullion banks (which is converted to physical on a regular basis). If you're not comfortable with the unallocated business model then go with allocated. 85% of Depository clients (by ounces) hold unallocated, the rest allocated.
Matthew 26:14 said:
You're confused because you're not using precise terminology. Restated: "In 2008 the ass fell out of silver due to selling by leveraged paper players needing cash to pay for other losses, while there was a physical shortage of RETAIL sized coins and bars." In fact, the leveraged paper selling, because of arbitrage, would have resulted in associated physical wholesale sized silver (ie 1000oz) bars coming into the market. This is why we didn't have any problem getting hold of 1000oz bars out of London during 2008 even while we were maxed out in the factory making coins.
fiatphoney said:
Site is www.sharelynx.com
I highly recommend this subscription service. Try the free trial period, you will be blown away at the number of unique charts. Well worth the money, its peanuts for what you get.
Argentum said:
Don't know, I've never analysed the numbers that way, we are pretty much only focused on number of ounces as our business is run on how many ounces we have/need. We have a pretty big spread of client sizes from $10,000 to $10 million and I think 20,000 clients off the top of my head, so I'd suspect statistically allocated:unallocated by clients would be the same 15:85
bron suchecki said:
Here's an interesting interview with the fellow who runs the site. http://www.goldmoney.com/audio/2011-10-18-GMYF-DF-E-03.mp3
wrcmad said:bron suchecki said:
HOLY SMOKES BATMAN!
Free Market 1, Conspiracy theorists 0.
You suffer from Cognitive dissonance obviously and /or dyslexia ...autism . I would not be surprised if the metals markets are manipulated
.
bron suchecki said:
Thanks for your reply Bron, I think you have answered honestly tho each and every sentence will be analysed like a vivisection by all interested and different messages taken as always. I appreciate your answer none the less.
southerncross said:wrcmad said:bron suchecki said:
HOLY SMOKES BATMAN!
Free Market 1, Conspiracy theorists 0.
You suffer from Cognitive dissonance obviously and /or dyslexia ...autism . I would not be surprised if the metals markets are manipulated
.
That is arguable.
Have you not noticed there is much wailing and nashing of teeth regarding long term price suppression and the "true" value of silver? :|