What is up with the crash in silver prices

Ooh. True. I think there is going to be a big drop, but then it will gradually go up again. When it drops is when I will jump on the chance.

 

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What if the drop has already happened and it's now on its way back up? Don't miss your big opportunity. :high5:

 

Very true I'm placing my order from the mint today anyway.

 

I don't believe we will ever see the days of $5/oz silver ever again - it's just too unrealistic unless oil prices fall back to 50usd/barrel but I'm sure we all know the answer to that.

However a high metal price doesn't automatically guarantee that there will be an increase level of production, instead the opposite will happen, that is LOWER production of metals will be produced. The reason for this is because as prices of metals get higher, lower grade ores which could have been treated as waste can be economically grind, milled, etc. Because milling machines are just so expensive, it's just not feasible to install new machines to process more ore. High grade ore, low grade etc all go through the same machine with adjustments.

Therefore, once managers have a good idea that when metal prices are definately going up, they will likely try to process a higher percentage of stockpiled low-grade ores which in turn reduces overall supply. Prices spike up accordingly to the lower supply which then when the low grade ores are almost processed, there should be a batch of new high and low grade ores mined. Depending on the market condition, managers will have to judge what grade or mixture to process.

There is no way that prices will just keep on going up and up and up unless global population and demand increases at the rate that YOU dream. Probably a lot better to invest in agriculture related stocks. For the past couple of months, I have repeatedly stated that prices can't go too much higher. For those who made profit recently, congratulations.

 

I don't think it will ever get below $10.50 again. My guess is that it's not worth mining below that. I've always felt that since silver held the $10 range for so many years that this was the new bottom. Infation is the key factor here, not the hours it takes to mine it. The hours it takes to mine silver or gold remain relatively the same except for technology which may decrease the time spent in the mines. But the cost per hour in the mines increases with inflation only.

 

Yet that is what happening with homes around here. My home is worth $70,000 less than two year ago.

 

And we're powerless to stop it. All we can do is watch and wait till something positive happens. Can't move, sell or borrow against it. Just wait! :headbang:

 

a key date coin's value has zip to do with the value of the metal of which it is made. key dates are key for a reason; supply, demand, existing numbers - those are the factors that determine price.

but yeah, it would be nice to pickup an MS65 1948 for under $500.00

-Steve

 

i'm just hoping a few will be forced to sell at under the price but won't cross my fingers lol

 

Silver and Gold prices must not have an effect on bullion coins from the U.S. Mint. You can buy a 2008 ASE for $25.95 all day long. When the price of silver goes down, the prices stay the same...$25.95. If the price of silver goes up....they halt the sales of all silver bullion. Since this is just bullion, why don't prices fluctuate with the market? Same thing with gold.

 

The bullion price in the Market does affect the bullion price of Gov't sales. But just like any other collector, they think they know what it will be tomorrow and so they price it at top dollar when they're ready to off 'em! Yup . . . that's what they do!

 

Because when bullions are bought, buyers always have them in terms of x amount of ounces on a certain date on a contract at y dollars. Imagine how difficult it is to do accounting if you are forced to change the prices on a hourly basis. No thanks.

 

Thanks for clearing that up guys. I understand now. hya:

 

Yeah guys, for the last three years I've had a dealer that offers silver eagle lock in prices for the upcoming year....haven't heard from him this year.

 

Just out of curiosity, is this on a daily basis? I know with stocks it is. If you decide to buy at $110 at 10am and the market closes at $125, you actually bought at closing cost of $125, not the cost at the time of purchase. Never thought about the bullion markets like that for some reason.
Guy~

 

Guy, I am not too aware of what are the terms and conditions and this can possibly vary in different countries as well as with whom you are dealing with. Some mining companies deal heavily on hedging whereas some don't. The thing is, companies can lock in contracts with buyers at any price for any duration period of time. Current spot prices are just nothing but for reference purposes.

If I am not mistaken about the current market situation, what is fundamentally different about the recent market is that the Chinese buyers have difficulties understanding what contracts are all about. They expect you to offer the best price where ever possible otherwise they will back out. Yea sure that's the goal of competition but when there is a hiccups in the production level, there is very little margin of a company to recover.

 

Finding the silver

For those that have not really read through the threads in depth I repeat. Find the silver (physical) without a huge premium. Just not happening basically.

Perfect example. We have a customer that comes in almost every Friday for 20 silver dimes. Always at 10x face or lower.
Last Friday the spot dropped but our sell went to 11x face. People aren't selling and, yes, dealers do not want to lose money on everything they sell.
He said he would buy elsewhere which honestly surprised my boss.

Guess who was in again today? You got it - he found out he drove around wasting gas to find no silver or higher prices. So today the boss raised it up to 12X face.

Guy questioned it but has been doing some reading as well. He wants the real stuff. Bottom line is he ended up purchasing 2 silver rounds at $16 each. More than his usual purchase. 10:1 he'll be back next week.

The "fake spot" price is wreaking havoc on dealers all over. Not long ago we would buy at 10x and sell at 12x. Now we buy (when it trickles in) at 8x and sell at 12x?

Businesses still need to make money not lose it. Most (customers) are beginning to understand this.

I talked to a guy today that is supposed to bring in some "junk" tomorrow. Told him we'd be at 8x. Sounds like he has a bunch of quarters from the 30s. If they're decent I'll buy some from the boss at 12x.

Yes, I'll pay the same spread my only advantage is I can cherry pick.

 

Unless you are literally trying to liquidate (which would be a VERY bad idea) a large collection in the next 6 to 12 months this is a good thing.

 

not bad apmex sells it at 15.29

however i personally do not agree on the whole raising price thing just because the buyer couldnt find it cheaper else where

 

That came out wrong He didn't raise it just for one buyer.

The boss is looking to buy right now as we are starting to run low and it's not to found at a reasonable price. The vast majority of silver and gold coming in now is in the form of sterling silverware and old jewelry.
Most of that goes to the refiners. At these levels the silverware sits. He did just send some gold in and locked in a decent price.

He's been at it for 40 years so he knows what he's doing but it's an odd storm to ride out as a dealer.