I haven’t been overly excited about the US Mint “selling out” of American
Silver Eagles (ASE) because the demand has been so low, their projections
have simply been off the mark. This disruption in ASE’s is nothing more than
the management of the ASE program miscalculating the number of eagles of
produce. The same goes for the Gold Buffalo’s as well. It has nothing to do
with supply and everything to do with demand. The demand simply has not been
their for the past 14+ months so, why get ahead of yourself?
If you have already picked up some 2018 ASE’s I would actually suggest
waiting until 2019’s are released – of course, you do what you want and pay
no attention to what I say, I am telling what I’m doing – I’m waiting until
the premiums come down and that should be after the first of the year when
the US Mint is flush with product. Premiums are elevated on these products
because they can be – not because of door-busting demand.
When I told you all that I had picked up the latest ATB earlier today, I didn’t even
mention ASE’s or that they are currently sold out at the US Mint. Why?
Because an ASE is an ASE is an ASE is an ASE – over and over and over. Same
design, same everything with only one number changing each year for the past
18 years. The last major change was when the millennium changed from 1999 to
2000. That was the most significant change since 1986 to the ASE and AGE
(American Gold Eagle). There has been no other significant change to the
design since. Gold Buffalos have the same flaw as the ASE / AGE.
Clint Siegner at Money Metals see this situation in similar fashion as
myself.
The lower metals prices are, predictably, driving increased demand for
physical bullion from U.S. retail investors. Bargain hunters, who had less
reason to buy during the first half of the year, have come out in force over
the past two months.
Perpetually plagued by shoddy production planning, the U.S. Mint announced
last week the government agency is temporarily sold out of silver
American Eagles and gold
Buffaloes. Premiums for those coins moved higher almost immediately,
especially on Silver Eagles.
The government-run “enterprise” typically operates with little room for
error and does not maintain a large supply of unstruck planchets.
This means it can’t handle moderate to large fluctuations in demand. It’s
not unusual for the U.S. Mint to fail in its statutory mandate to produce
sufficient coins to meet public demand.
There is some pressure building on premiums for other sovereign coins, rounds, and bars. Those inclined
to buy metals in this price range should consider moving quickly. Source
At the end of the day, it’s not a big deal and hardly even worth reporting
on, except the fact that premiums are moving to higher ground. Once again,
nothing unusual, just a way for the wholesalers and retailers to make a
better margin – that’s how a free market works. If you’re smart enough to get
your annual supply while premiums were low, good for you. If you didn’t,
well, you get to finance Christmas bonuses for some of the retailers and
wholesalers!
