No slump in physical gold demand


A falling (or suppressed as the bulls like to say) price brings up demand for gold, with sales of American Eagle gold coins by the U.S. Mint of 755K so far this year already surpassing the 753K for all of 2012.

The big action comes as the metal heads for its first annual price decline since 2000, and low inventory forced the mint has to suspend sales of coins weighing one-tenth of an ounce from April 23-May 28.

Starting 2012 at about $1,700 per ounce, gold today goes for $1,320.

Gold ETFs: GLD, IAU, PHYS, SGOL, UGL, DGP, GLL, DZZ, UGLD, DGL, DGZ, AGOL, GLDI, DGLD, FSG, TBAR, UBG.

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Comments (17)
  • Marco Mazzocco, CFA
    , contributor
    Comments (192) | Send Message
     
    If you liked at 1700 you must love it at 1300. Not much surprise there. I'd be buying it too.
    4 Nov 2013, 10:30 AM Reply Like
  • DeepValueLover
    , contributor
    Comments (11069) | Send Message
     
    About six months ago most gold bears here on SA were talking about $900 & $800 gold.

     

    What happened to all of that?
    4 Nov 2013, 10:34 AM Reply Like
  • Interesting Times
    , contributor
    Comments (14932) | Send Message
     
    DEEP

     

    On my blog I still have posters calling for sub 1k gold...

     

    I for one don't see it. However the miners becoming broke will only diminish the quantity being made so I see prices actually going up !

     

    Just wait for everyone to see what Obamacare will do to this country and things might get dicey..
    4 Nov 2013, 02:44 PM Reply Like
  • Philip Marlowe
    , contributor
    Comments (1547) | Send Message
     
    This is a very misleading article. There is in fact a slump in physical gold demand. The article only talks about year to date figures, and these figures are benefiting from the very high coin sales earlier in the year.

     

    The story is that when gold initially fell in the spring, gold coin sales skyrocketed. But as the gold prices stayed low, gold coin sales started to plummet. Thus sales really dropped off of a cliff in august and september this year. October sales improved from the really bad september figures (probably because of the shutdown drama). However, october sales are still about 10K ounces less than october of last year.
    4 Nov 2013, 10:35 AM Reply Like
  • ddearborn
    , contributor
    Comments (173) | Send Message
     
    Hmmm

     

    Actually as of the end of October US purchases of gold and silver coins had already exceeded all of 2012. I am not sure what your agenda is here. But the fact is that demand and actual sales of physical gold and silver is on track to set yet another record.

     

    In short the basic law of supply and demand has been negated by massive manipulation of the precious metals marks by the usual suspects. (the ones with the most to gain from low prices and the most to lose from high prices) World wide gold production is DOWN. Worldwide demand is WAY UP. And yet prices fall. It is pretty much the inverse of oil. Since 2007 worldwide demand has declined or remained even. World wide supplies of oil have gone up as massive new fields have been discovered. And yet drum roll please oil prices on the whole remain high. "free" markets are great aren't they! If you have enough money and power you can make them do just about anything.....

     

    Take a look for the uptenth time as the "market" in gold went straight down in a matter of minutes after the latest "announcement" by the "FED". Never mind that the US government has just borrowed another trillion or that the FED is busy printing 100 Billion a month. There is no inflation, there is no inflation. Gold is a bad investment, sell gold, sell gold.
    And of course the same people that are telling you to sell are busy buying everything they can get their hands on.
    4 Nov 2013, 01:24 PM Reply Like
  • solarcircle
    , contributor
    Comments (320) | Send Message
     
    coin sales in the U.S. are almost meaningless with regard to gold price. The demand in China is much more than being reported as a huge amount of their inflow goes unreported and not all of it comes through Hong Kong. Huge amounts are coming from Switzerland.
    4 Nov 2013, 03:14 PM Reply Like
  • solarcircle
    , contributor
    Comments (320) | Send Message
     
    It seems Forex trading is likely the elephant that is skewing the gold price: http://bit.ly/184VPV6
    4 Nov 2013, 03:18 PM Reply Like
  • filipo
    , contributor
    Comments (4635) | Send Message
     
    What happens if demand for American Eagles surpasses the US Mint's supply ?
    Do they hang out a billboard saying "sold out" or do they increase supply by digging into the reserves ?
    4 Nov 2013, 10:35 AM Reply Like
  • Interesting Times
    , contributor
    Comments (14932) | Send Message
     
    Filipo

     

    As we discussed the Mint has gotten it's LAST delivery of 2013 ASE'S for the year. Lets see if we do get a shortage ..

     

    I doubt it though. Just a gut feeling..
    4 Nov 2013, 02:47 PM Reply Like
  • filipo
    , contributor
    Comments (4635) | Send Message
     
    Interesting,
    "As we discussed the Mint has gotten it's LAST delivery of 2013 ASE'S for the year."
    So you mean they actually closed their shop for the rest of 2013 ?
    This is really ridiculous. As if year-end buyers didn't exist.
    That's no shortage, it's a rolling blackout !
    4 Nov 2013, 03:28 PM Reply Like
  • Interesting Times
    , contributor
    Comments (14932) | Send Message
     
    FILIPO

     

    He hasn't closed his doors as he is selling way more other items. But just today said he received his last monster silver box for the year and expects to sell all of them within 2 weeks!!

     

    December the 2013 ASE could get interesting..
    4 Nov 2013, 03:36 PM Reply Like
  • filipo
    , contributor
    Comments (4635) | Send Message
     
    Interesting,
    Did the Mint ever say the 2013 ASE was going to be a limited edition ?
    In that case, it's understandable they ran out of steam, although from the point of view of a tradesman, a poor argument.
    What you mean by "other items" ? Tungsten ? Spelter ? Gold ?
    BTW, it took me a while to find out what ASE means:
    http://bit.ly/1aoISFF
    I'm not so familiar with silver you know: it easily becomes a nuisance when you have to deal with the hoarding. Little money gives huge volume.
    No kidding, they're still selling gold at leisure then, in whatever shape ??
    Anyway, it seems to me that if a fair part of the demand of ASE can't be met, the price should be higher.
    5 Nov 2013, 05:16 AM Reply Like
  • Interesting Times
    , contributor
    Comments (14932) | Send Message
     
    FILIPO

     

    Nope, it isn't a limited addition. It is our primo bullion and demand for it the last 2 years as caused the same exact problem. So 2012 had the same issue. My vendor said it will be gone in 2 weeks max. Then we have to wait until the 2014's arrive.

     

    Where I live the coin shops sells just what you said, plus plenty of numismatic stuff. Which are graded pieces that collectors like. However the last 2 years at coin shows bullion has overtaken the purchase of collectibles.

     

    One very smart person told me that if silver ever broke out in price the numismatics most likely would not. So I have a 3 piece collectors set of perfectly graded 2006 ASE'S from the anniversary set and it goes for around $1300 on Ebay. Keep in mind this is only 3 ounces of silver. I bought it for much less.. Do I sell it?

     

    So is this a fad, or will it continue. Myself, I collect some old pieces not to sell but to pass down and enjoy as a conversation piece. But once I see I can make a pretty buck on it then it's gone!!

     

    Doesn't happen much with the graded pieces as it is almost like a car. Once you walk out with it the value is less then when you bought it. Unless something strange happens and maybe the Mint stops making it. That happened in 2008 I believe with the 4 piece Buffalo gold set. It cost around $3k for appx 2 ounces of gold. BUT it was graded a 70 which is perfect.

     

    The Mint stopped making them and it was dumb luck that I had one set. Once the price hit 9k for the set I got off the bus. But look on line and you will see gold going for around $100 bucks over spot from some very busy on line dealers...

     

    http://bit.ly/1b9zE0S

     

    Here is a reputable on line dealer. Check the prices yourself!!
    5 Nov 2013, 02:06 PM Reply Like
  • filipo
    , contributor
    Comments (4635) | Send Message
     
    Interesting,
    Well, if it isn't a limited edition, then the Mint sets its own limit anyway.
    I myself almost never buy coins: prices differ too much depending on condition and I'm too risk averted to invest in something I don't master perfectly. It's like collecting stamps: you not only need a good eyesight, but quite a bit of training too. Otherwise you might get cooked by the experts.
    I own a few $20 Double Eagles (St. Gaudens) though and find them among the nicest coins ever made. Nothing in the world will make me decide to get rid of them, not even Richard Cox and his Brothers. I actually don't regard them as an investment but as pieces of art. Now they sell with a 7% premium over here. I bought them some 30 years ago at a time when the premium was only 1.5%. Taxes have been added too since.
    I also have some Victorian ponds from around 1900, but they're worn.
    And of course, there's bullion. We have some excellent gold smiths over here: London based Johnson Matthey, Crédit suisse, UBS, Umicore... they all come with a number engraved and an attestation:
    http://bit.ly/YiQzf9
    There's a wide variety but delivery time increases by the month.
    5 Nov 2013, 03:19 PM Reply Like
  • brucerappaport
    , contributor
    Comments (8) | Send Message
     
    Wait for the Dragon Event...When you least expect it. (Black Swan)
    4 Nov 2013, 12:22 PM Reply Like
  • Brian Bobbitt
    , contributor
    Comments (2083) | Send Message
     
    As usual, as time goes by, and the item in focus, gold, elicits all those 'in waiting' to begin to joust at dragons. Just as long ago, when the camp was surrounded by a dark forest, odd sounds, fiery red eyes peering into the fire which was all that held the beast at bay, the encampments would conjure up all sorts of horrors just beyond the twilight zone of their campfire. It is, probably, how most gods, demons and zombies were created. With nothing more to do than let their imagination run wild during the night, in the morning the stories ran like wildfire through the troops. The longer the night, the more the stories. Why don't you all grow out of the dark ages, look at the realities of what is happening out there, and by now if you don't know what powers the gold market, then it is time for you to go sell shoes or just retire and live off the veggies in your Victory Garden.
    Gold is cooking in its usual vat of poisons, witches brews and congress' all over the world. It is quite obvious that the powers that be (TPTB) have no clue on how to run a peaceful world, economy or marriage, any more than the Battling Bickersons. Their schemes make Ralph Kramden's and Norton's ideas look like they were both geniuses.
    The world is being torn apart by various factions attempting control, and it just ain't working. This in my opinion will simply keep the PM's on their track up. Just go look at a long term chart, of months before now, years even and if one cannot see the uptrend, then I am sorry. Look at the uptrend in Ag also.
    Copper is where my focus is and has been and will be. When copper finally rises above $4 and Coal and Natural Gas begin to be used, and sanity returns to the global market you can keep your gold and buy more. This is not likely for at least another decade and by then the PM's will not fall below their present levels significantly enough to call it a bear market in metals. Options may play out to be losers due to the slow move upward, but mark my words, the PM's will rise from here.
    I have a modicum of metals, real estate (rentals) home ownership free and clear, and a parcel of mutual funds. I am in very conservative stance, and not losing is my prime goal. Second goal is to fund my retirement without losing ground overall in my net worth. Later this month I again meet with my money managers, take an overall look at how I am doing.
    May interest you to know that my numismatic coins are doing the best %-wise, even beating my 12.5% return on my "stocks".
    See my stock comments for holdings of MF's
    Conclusion: Stop wincing at the ghosts and shadows of the forest beyond your view. Go with your gut feelings and roll with the punches. There are no monsters out there, just realities that have not shown up yet. These answers are not to be known, guessed at nor available yet. If you must invest in volitile items, then you must be prepared for being terribly wrong when unknown events arise like storms in paradise.
    What we do know is what we have to work with, go with that and protect your views with stops and rules.
    Good luck
    Capt. BrianThe Lost Navigator
    4 Nov 2013, 12:23 PM Reply Like
  • Brian Bobbitt
    , contributor
    Comments (2083) | Send Message
     
    This is a reply and follow up to my last post. Look at a long term chart in gold and tell me it is not in an uptrend long term. I am not [any longer] a day trader, so I look more to the real trend which may show me a profit over time. ( like a year or little less) Gold seems to me to have a nice solid uptrend and with its fits and starts, I still see my stash growing in value. I have been able to 'trade up' to more valuable coins and it is ONLY the value of my PM account I look at and its percentage move compared to other vehicles and gold and silver, added to numismatics is the clear winner at over 13% annualized. Gold is rising, argue that.
    Capt. Brian
    The Lost Navigator
    7 Nov 2013, 02:45 PM Reply Like
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