Gold premiums

I certainly don't have any opposition to someone using a percentage of it in their portfolio or net worth. That's a perfectly reasonable approach and can be part of diversification. Heck if people just want to buy it to buy it because that makes them happy collecting it I have no problem with that either. It's more just the sky is falling types or the metals will always be a winner that gets pushed that I want to correct. Have read about to many people losing a lot of money buying into that mentality over the last several years.

 

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Howdy,

Premiums are determined by several things: quantity [1 oz is cheaper than a fractional], demand [how badly people want this particular issue] and fungibility [how easy is it to sell].

Here's the daily quote sheet by my LCS. It's always served as a decent guide.

http://libertycoinservice.com/wp-content/uploads/quotes/daily_quotes.pdf

and so it goes,

peace,

rono

 

I know people get impatient, but don't buy that 1/10 oz with a huge premium. Just wait until you can afford a full 1 oz AGE or gold Maple.

 

I cannot agree with this. A full ounce is harder to sell unless you are going to one of the big online dealers such as APMEX. And the 1/10th will still retain its premium for resale. The only case where there may not happen is if society devolved to barter, but in that case the smaller coin will be of more use anyway.

 

With all due respect, if your frame of reference is a podunk little town's local coin shop, then, yeah, I understand why selling a single ounce of gold may be hard with their limited cash flow.

However, in the big world out there that most of us live in, selling an ounce of gold is no big deal.

So then the question becomes: do you buy an ounce of gold for $1300 today, or about $50 over spot in the form of a single coin, or do you buy 10 1/10th coins for $150 each, or $1500 today?

Why waste the extra money? I could resell that 1 oz I bought for $1300 for around spot or a little higher, or $1250-$1275. ($25-$50 loss) I could resell those 1/10th coins for about $10 each over spot ($135 or so each, loss of $15 each)

So at the end of the day, I'm out $25-$50 on the 1oz coin or around $150 on the tenth oz coins total. Smart people know what choice to make...

Illogical people might as just buy Maplegrams, if smaller is better, right?!

 

A one ounce transaction might seem large for us as individuals, but in the big picture these days, it's a tick on an elephant's backside.

 

The Swap Meet [my special gift to sakata, who GETS IT]

June 2027, in the parking lot of a gutted Walmart:

Privy: "Hey, how much is that case of chili?"
Big Shot: "Just $130. That's prime, only 8 months old! Or I'll take 15 silver dimes and throw in a dozen dressed squirrels. Real meat! Got a bag?"
Privy: "Um, all I got is this AGE..."
Big Shot: "Let's see it. OK, here's a chisel and a mallet. Whack off .05 ounce. I got a scale somewhere."
Privy (doing the math): "Wait a minute, that's like $250!"
Big Shot: "Just shot them squirrels at daylight. I'll throw in a jar of salsa too. And these..."
Privy: "What year?"
Big Shot: "2021 - it lasts forever. Save these squirrel tails to make a winter cap... I'll show ya how next week."

 

Please leave the adults alone to discuss this real world topic with logic and facts.

 

Which means, you can dish it out, but you can't take it...