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<p>[QUOTE="medoraman, post: 4266398, member: 26302"]No, spot IS the "market". Physical long term is tied to spot, but when people get crazy inventory is depleted and premiums get jacked up. I am sure Costco could have increased prices of toilet paper and hosed everyone, but they didn't, they showed integrity and sold at standard prices until they ran out. Bullion dealers do not show the same moral fortitude.</p><p><br /></p><p>Just like my analogy earlier. I am "the market" for sorbic acid. I buy tremendous quantities. A month ago if someone wanted to get a bag of it, they might have paid $1 a pound more for it than I pay for it. Today, that same person looking for one bag might have to pay $8 a pound more for it than I will. Is the tiny buyer looking for inconsequential quantities "the market" or am I? "The market" for pm are jewelers, solar cell manufacturers, chip makers, and others who order in hundred thousand dollar increments and higher. Someone wanting to buy $100 of junk silver or a single ounce of platinum is NOT "the market". They are an incidental market who will get hosed when the dealers feel like. </p><p><br /></p><p>If my dealers for sorbic acid tried to jack up my cost 30% during this time, they would lose tens of millions of future sales to a major consumer. That is why they do not do that. I am pretty sure large users of PM are the same, they will ruin any distributor who tries this by never ordering from them again. However, a bullion dealer looking at selling you 10 ounces of silver? Heck with you, they can hose you all day long without fear of affecting their long term business.</p><p><br /></p><p>Everyone here looks at the spot versus physical market wrong. SPOT is "the market", physical buyers are incidental purchasers who do not REALLY matter long term to the miners. Just the truth.[/QUOTE]</p><p><br /></p>
[QUOTE="medoraman, post: 4266398, member: 26302"]No, spot IS the "market". Physical long term is tied to spot, but when people get crazy inventory is depleted and premiums get jacked up. I am sure Costco could have increased prices of toilet paper and hosed everyone, but they didn't, they showed integrity and sold at standard prices until they ran out. Bullion dealers do not show the same moral fortitude. Just like my analogy earlier. I am "the market" for sorbic acid. I buy tremendous quantities. A month ago if someone wanted to get a bag of it, they might have paid $1 a pound more for it than I pay for it. Today, that same person looking for one bag might have to pay $8 a pound more for it than I will. Is the tiny buyer looking for inconsequential quantities "the market" or am I? "The market" for pm are jewelers, solar cell manufacturers, chip makers, and others who order in hundred thousand dollar increments and higher. Someone wanting to buy $100 of junk silver or a single ounce of platinum is NOT "the market". They are an incidental market who will get hosed when the dealers feel like. If my dealers for sorbic acid tried to jack up my cost 30% during this time, they would lose tens of millions of future sales to a major consumer. That is why they do not do that. I am pretty sure large users of PM are the same, they will ruin any distributor who tries this by never ordering from them again. However, a bullion dealer looking at selling you 10 ounces of silver? Heck with you, they can hose you all day long without fear of affecting their long term business. Everyone here looks at the spot versus physical market wrong. SPOT is "the market", physical buyers are incidental purchasers who do not REALLY matter long term to the miners. Just the truth.[/QUOTE]
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