For some time, I have been warning that apparently plentiful supplies of gold and silver bullion-priced coins and ingots could quickly evaporate. Last Thursday we saw the first signs of a looming shortage of physical metals when just about all U.S. bullion wholesalers were unable to accept orders for the South Africa Krugerrand. One primary distributor said they expected coins in a few weeks, which I think means that they are waiting for a shipment of freshly minted coins from the South Africa Mint. My own company had to discontinue accepting new orders until we could lock in a supply.
Tens of millions of Krugerrands have been struck since they were introduced in 1967. They are not rare. If demand for physical gold is so strong (and the World Gold Council last week reported that global third quarter demand was 15 percent higher than the second quarter) that they are no longer available, we could quickly see a domino effect where other gold and silver bullion-priced products also become sold out.
We may see some temporary price dips this week as the gold and silver options expire. However, I fear that there is little time to lock in physical precious metals at reasonable premiums for quick delivery.
No comments:
Post a Comment