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The folks over at the iShares Silver Trust (NYSE:SLV) were quite busy last week, adding a total of 420 tonnes of silver to their stash, pushing the inventory at the world's most popular silver ETF above the 8,000 tonne level for the first time ever.
Since the first of the year, they've added 1,234 tonnes to the trust, an increase of about 18 percent. During that time, the price of silver has risen almost 30 percent, the best performing commodity so far in 2009 by a wide margin.
“There is demand for double or triple what the US mint is able to produce,” said Michael Kramer, president of MTB in New York, one of the four US gold dealers authorised to purchase bullion coins directly from the government’s mint.
The US Mint has sold 193,500 ounces of its popular American Eagle gold coin in the first seven weeks of this year, the same amount it shipped during the whole of 2007 and about the same as in the first six months of last year.
“The demand is extraordinary. All the coins we got on Monday are gone today [Tuesday] and we will not be able to take any order until the following week,” Mr Kramer said. “It is the same with other mints.”
Gold is the most favored investment this year ahead of investment-grade bonds and other assets, according to a survey of investment advisers, the producer-funded World Gold Council said.
About 60 percent of the 31 advisers surveyed in Europe expect investors to take fewer risks this year compared with 2008, while about 30 percent expect investors to be less risk averse, the London-based council said today in a report. Almost 60 percent expect better market conditions this year.
The following is a table of preference for 10 investments. A figure of 1 is most favored and 10 is least favored.
Asset Average Ranking
Investment Grade Credit 4.13
Commodity Basket 4.71
Non-investment Grade Credit 6.45
Government interventions can cause gold and silver to trade at prices lower than they would in a free-market, as has been so thoroughly and carefully documented in the mountain of research compiled by the Gold Anti-Trust Action Committee, now celebrating its tenth anniversary (www.gata.org). But in the long-run, these market interventions cannot prevent gold and silver from rising when national currencies are being debased, as is evident by the fact that gold has risen against the dollar for eight years in a row.
Interventions into the free-market process inevitably become clear as greater numbers of people come to understand that governments and central banks do not determine the value of gold or silver anymore than they could set and then control at their desired level the value of a Picasso, a condo in Miami or a pound of sirloin steak. We participants in the market process determine the value of all goods and services, and money is a good – but a special one because without it, the market could not operate. And sound money is the best money of all.
Originally posted by UMayBRite!
A while back I thought of a way to make Gold more accessible to the public. I wanted to sell Gold Bullion in Gram and fractional Gram Forms. A gm is about $32 USD now. 100 mg would be about $3. Sell them as a foil in a plastic carrier. The Carrier could be replaced with a special tool if it wore out. The "foil" would be shaped in such a way so that a simple inertial test would tell if it had been tampered with. The idea would be to make it moderately secure from tampering and forgery so that the value
Even had a name for my company;
Investors are also flocking to gold coins. At the U.S. Mint, a total of 147,500 ounces of American Eagle gold bullion coins were sold in the first two months this year, a surge of 176% from the same period last year.
Demand is rising at the Comex, the metals division of the New York Mercantile Exchange, where investors increasingly are choosing to take physical delivery of gold, rather than cash, once their futures contacts expire.
Rising delivery orders have kept Brink's Inc., a major carrier for the Comex, busy. The Richmond, Va., company said it saw a large spike in clients shipping gold and silver from the exchange over the past few months.
In December, 4.5% of gold contracts ended in delivery, compared with 3.4% a year earlier, according to the exchange. Investors also are taking delivery of silver, with contracts ending in delivery rising to 7.3% from 4.7%. December is typically a big month for deliveries, and in
January, deliveries remained higher than the year before.
Investors typically buy gold on exchanges using futures contracts. Since each contract represents 100 ounces of gold, an investor would have to pay $96,910 per contract, based on Tuesday's close, in order to take delivery. By contrast, investors need to put down only $3,999 up front to trade such a futures contract.
"It is an expensive proposition," says Jeff Christian, managing director at CPM Group, a New York precious-metal research firm.
Also, the logistics of buying a big lump of metal might be daunting for smaller players. Investors who decide to take delivery of gold contracts face high storage and insurance costs. And if buyers actually want the gold or other precious metals in their possession, they must
arrange for delivery by armored truck. In a recent delivery of 100,000 ounces of silver, Mr. Coleman paid $3,000 to transport the metal from New York to Idaho.
NEW YORK (MarketWatch) -- Gold futures rose Friday for the first session in five, climbing above $950 an ounce as losses in the previous four sessions attracted buyers. Gold for April delivery rose $12, or 1.3%, to $954.60 an ounce in early North American electronic trading. It had tumbled $60 from its last Friday's high above $1,000. "Gold was supported by bargain hunter demand," said James Moore, an analyst at TheBullionDesk.com
The dollar has gained 9.5% against the euro this year, and the dollar index ($DXY:US Dollar Index Future - Spot Price
a broader gauge measuring the value of the greenback against other major currencies, has climbed 8%. Gold has made nearly the same gain, with front-month futures rising 10%.
In past periods -- most notably the second half of last year -- the dollar and gold often took off in opposite directions. Analysts often cite the strong performance of the dollar as a reason behind past drops in dollar-denominated gold prices. But the metal has withstood the dollar's rally this year, topping $1,000 an ounce on Feb. 20 for the first time in 11 months.