Silver Prices Have Changed
The price of silver has changed dramatically in the last year (2008).
It used to be that the price of silver was the price of silver in other words, if the silver spot price was ten dollars per ounce, then a one ounce .
999 silver coin was ten dollars plus a small premium for the minting costs.
That premium was usually a very small amount, usually about one dollar or a little more.
That would mean that you would pay eleven dollars to buy the silver coin at a spot price of ten dollars.
This is definitely not the case anymore and no one seems to be able to provide a reasonable explanation as to why.
While the actual current silver spot price may be ten dollars, that very same .
999 coin that last year was selling for eleven dollars (because of the small minting premium) is now selling for anywhere from 15 to 25 dollars.
That is right, a markup in the range of 50 to 150 percent profit.
How can this be? Why is there no easy to understand reason behind this sudden change in the spot price and the actual physical selling price of silver? One must look at the rapid growth of the paper silver market like e- silver silver futures, silver options and silver stocks.
The silver paper market has be growing exponentially in the last five years while the mining production of new silver from the ground has actually decreased.
One can only speculate that there has been a short selling of silver through the paper markets.
That means that lots and lots (probably millions of ounces of silver) of silver has been sold on paper that is not there in reality.
This would explain why you could have two distinctly separate prices for silver.
One price is the current spot price that silver paper traders are selling their products with and the other is the actual price that people are paying to take delivery of the silver The vast majority of people, businesses and institutions that buy silver do not take physical possession of it, but instead, leave it in the sellers vault somewhere for safe keeping.
This raises an unseemly question.
What if the silver you bought on paper in fact, does not exist.
Never buy a precious metal unless you plan to take delivery of it and have a place to safely keep it until you are ready to sell.
This amazing situation does not seem to be abating, it seems to be continuing over several months now.
If you want to buy and actually have real silver you will be paying a much higher premium than ever before.
It used to be that the price of silver was the price of silver in other words, if the silver spot price was ten dollars per ounce, then a one ounce .
999 silver coin was ten dollars plus a small premium for the minting costs.
That premium was usually a very small amount, usually about one dollar or a little more.
That would mean that you would pay eleven dollars to buy the silver coin at a spot price of ten dollars.
This is definitely not the case anymore and no one seems to be able to provide a reasonable explanation as to why.
While the actual current silver spot price may be ten dollars, that very same .
999 coin that last year was selling for eleven dollars (because of the small minting premium) is now selling for anywhere from 15 to 25 dollars.
That is right, a markup in the range of 50 to 150 percent profit.
How can this be? Why is there no easy to understand reason behind this sudden change in the spot price and the actual physical selling price of silver? One must look at the rapid growth of the paper silver market like e- silver silver futures, silver options and silver stocks.
The silver paper market has be growing exponentially in the last five years while the mining production of new silver from the ground has actually decreased.
One can only speculate that there has been a short selling of silver through the paper markets.
That means that lots and lots (probably millions of ounces of silver) of silver has been sold on paper that is not there in reality.
This would explain why you could have two distinctly separate prices for silver.
One price is the current spot price that silver paper traders are selling their products with and the other is the actual price that people are paying to take delivery of the silver The vast majority of people, businesses and institutions that buy silver do not take physical possession of it, but instead, leave it in the sellers vault somewhere for safe keeping.
This raises an unseemly question.
What if the silver you bought on paper in fact, does not exist.
Never buy a precious metal unless you plan to take delivery of it and have a place to safely keep it until you are ready to sell.
This amazing situation does not seem to be abating, it seems to be continuing over several months now.
If you want to buy and actually have real silver you will be paying a much higher premium than ever before.
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