GOVERNMENTS CAN’T HANDLE GLOBAL RUN ON GOLD COINS
Tuesday, November 18th, 2008 | 
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Posted by John under: Perplexity,Root of All Evil
THERE’S a worldwide run on gold coins.
Perplexity
“…upon the earth distress of nations, with perplexity…”
—Luke 21:25
Root of All Evil
“For the love of money is the root of all evil…..”
—1 Timothy 6:10a
`Even as the price of the precious metal itself comes under pressure along with commodities like oil and copper, people around the world are demanding so many of the valuable coins that government mints are having difficulty filling orders.
A spokesperson for the US Mint tells me that gold coins in this country, for the past month, “are being allocated because of an increased demand.”
And the price that the government charges coin dealers has recently been increased by as much as 10 percent for a 10-ounce coin.
Robert Mish, a coin dealer in Menlo Park, Calif., says customers who want to purchase 200 gold coins often have to wait up to two weeks. Six months ago, he said, a purchase that size could have been filled immediately.
Someone who recently tried to purchase 100 one-ounce American Eagle gold coins in the New York City-area was turned away, even though he’d uneventfully made purchases before through the same dealer.
And even when gold coins are available, dealers report that customers are paying a bigger premium than they would have just a few months ago.
Previously, American Eagle coins were going for 5 percent over the market price of gold on the Commodity Exchange (Comex). Now the premium can be anywhere from 10 percent to 15 percent, even though the US Mint raised its price to dealers by just 3 percent for an ounce coin.
In one sense, the attraction for gold coins isn’t surprising. Since ancient times, gold has been considered the safest investment to hold in times of uncertainty.
With fears of future inflation rising and concern about the value of paper currency and government-debt increasing with each new recovery plan announced in Washington and in foreign capitals, the desire to hold gold grows.
That part makes perfect sense. But there’s another more puzzling aspect to the recent gold rush.
Even as the demand for gold coins such as the Canadian Maple Leaf or the Krugerrand of South Africa has grown, the market price of the precious metal itself is off its highs.
In early October, the price of an ounce of gold on the spot market was about $930 an ounce. With the commodities bubble bursting in recent months, gold declined into the upper $600 range. Spot gold closed yesterday at $739.90, down $2.60.
Bill Murphy, chairman of the Gold Anti-Trust Action Committee, says the price of spot gold is even more perplexing given the demand for coins and the fact that central banks in Europe have stopped selling gold into the open market.
“Gold should be moving up,” Murphy says. “How could there be such a dichotomy between the historic high premium for coins all over the world and the low Comex price?”
YeshuaAgapao says Comment posted on November 18th, 2008
My guess is that people are buying gold coins to protect their investments, but the demand for gold luxuries (jewelry, gold-wired base box speakers etc..) is down.
Ernest Gregoire says Comment posted on November 18th, 2008
I have been following the Gold story for a long time. I did well in gold stock, years ago. But like anything you invest to make money, or preserve wealth.
Buy low, sell high!
The selling high part is the hardest.
Right now, we are in a delationary cycle. see the following ; http://www.kondratieffwinter.com/
Deflation is far worse than inflation because nothing can be done about it, you must simply ride it out.
The following is a cut and paste from an article what appeared on Kitco.com
an outstanding source of information.
Q: Earlier this month you published a special edition to your SineScope publication entitled, “The Grand Bull’s Terminal Years: 2009-2011.” It contained an ominous warning for the years 2012-2014. Please elaborate.
A: The term “Grand” was included since it refers to the composite of all the cycles. Its duration is 120 years and I refer to it as the revolutionary cycle.
A revolution occurs with each cycle bottom which changes the three basic institutions that govern our lives: political, economic and social. The first revolution in this country was political since it involved war in the 1770s when America was freed from an occupied to an independent territory.
The second occurred in the mid 1890s when America transcended from an agricultural-based to a manufacturing-based economy. This was an economic revolution.
The third 120-year revolutionary cycle is scheduled to bottom in 2014. To complete the third institution, the upcoming Grand cycle bottom should be a social revolution.
The final three years prior to the bottom are ominous, historically, for they include a depression and a devastating war. Since “history always repeats itself” and there is yet to be a precedent to violate this, the years 2012, ’13 and ’14 have grave, broad-based implications.
End of cut and paste. It is attributed to; An Interview with a Cycle Master
By Clif Droke
You can search Kitco for the article.
If you want to find out what alrealy happened, read the news.
If you want to find out what will happen, read the financial news sites!
Ernest Gregoire says Comment posted on November 18th, 2008
http://www.kitco.com/
I forgot to paste the Kitco link in the previous post. Here it is!
K. Sorensen says Comment posted on November 18th, 2008
Very interesting stuff, Ernest. Thanks!
Fred Rich says Comment posted on March 26th, 2009
When times get tough, people invest in gold.