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This blog discusses The Perth Mint's bullion coins and bars, providing information about our latest designs, mintages, sales volumes and sell outs. On a broader front, we share relevant research and opinions for anyone interested in gold and silver bullion investing.

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Hot Money Is Distorting The Precious Metals Markets - Bron Suchecki

Topics [ depository gold bull market sell gold gold bear market buy gold ]

IN THE NEWS

Why is the gold price weaker? It’s mostly big money speculators, hedge funds and people in it to make a quick buck, according to Bron Suchecki, The Perth Mint’s Manager, Analysis and Strategy. They’re playing the trends and if they think the trends are against them, they all start piling out, he says.

Making his latest media appearance on the Financial Survival Network, Bron reports that while Perth Mint Depository had not seen much buying recently, there had been no radical selling from existing customers either, which is a positive sign for everyone with a strong commitment to gold.

And on a personal note, Bron says he is unfazed by the dip in the gold price, but suggests if you are feeling stressed about volatility, then maybe you have too much allocation to gold in your investment portfolio?

Listen in full to Bron in discussion with Kerry Lutz now.



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Impossible To Pay Speeding Fine Because No Gold Coins In Circulation

Topics [ gold coins sell gold silver prices ]

BLOG WATCH

The Brisbane Times reports on the case of a person who “tried in vain to argue it is ‘impossible’ for him to pay a speeding fine because the Australian constitution states the government can accept only coins made of gold or silver as payment for debts.

Indeed, section 115 of the Commonwealth of Australia Constitution Act states: ‘The state shall not coin money nor make anything but gold and silver coin a legal tender in payment of debts.’ ”

I would just note that Section 115 actually says “A State shall not coin money…” rather than “The state”, which implies the Federal Government is covered by the section. The speeding driver was aware of this, being quoted as saying “a state, as opposed to the Commonwealth, cannot compel you to pay in other than gold and silver coin. Fairly simple.”

While this doesn’t seem to be put in as a counter argument by the prosecution, Australia does have gold and silver coins minted by The Perth Mint. Interesting then that the Brisbane Times reported that “he argued he could not pay a $200 speeding fine, because ‘there is no gold and silver coins in common circulation’."

Certainly The Perth Mint’s coins are not in common circulation, but I don’t think that would have been material to his point that the state government could only compel payment in gold coins, considering that The Perth Mint coins are legal tender (for their face value).

It is just as well for the defendant that the prosecution was not aware that The Perth Mint 2oz gold coin has a face value of $200, as they may well have been able to compel him to pay the $200 fine with that coin (worth around $3,300 at metal value)!

There is also the now discontinued Royal Australian Mint $200 gold coin. Weighing 10 grams and only 91.67% pure, it would have only cost him around $500.

Supreme Court Justice Martin Daubney was quoted as saying that the basis of Mr Clampett's argument had long been discredited. Given the defendant was ordered to pay the $200 fine, $76.90 in court costs and $3,500 for the police prosecution's out of pocket expenses, he would probably have been better off paying the fine with a Perth Mint 2oz gold coin.

Download today’s full Blog Watch (pdf 186kb) for more reviews:

SILVER: THE SHREDDER

Is silver a “shredder” that chews up investors' money or do you agree with David Jollie, “the most accurate forecaster in last year’s London Bullion Market Association survey of silver prices”?

SILVER MEMES (OR MYTHS)

In his MineWeb article, Lawrence Williams has a go at a couple of common silver memes.

JAPAN INVESTORS LIQUIDATING GOLD

It’s not just because “the fear of inflation have been wrung out of the Japanese psyche over the last 15 years.”



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Weight Of Money Waiting For Gold?

Topics [ sell gold invest in gold buy gold ]

BLOG WATCH

Speaking at the Denver Gold Group European Gold Forum, Philip Klapwijk of GFMS is reported by Mineweb as ‘providing both side of the argument’ (often called sitting on the fence, although that’s probably being a bit harsh) on the issue of “whether or not there is a massive weight of money sitting on the sidelines of the market at the moment or, if those investors that want gold now have enough.”

Quote: “If you look at the value of gold investment, gold remains a tiny portion of the overall markets so, theoretically there is a huge scope for investment demand but, one does have to ask the question, Why after 10 years of a bull market you havent seen more of these mainstream portfolio managers come into the markets?”

My view is that we are going sideways price wise at the moment because those that want gold have enough. We need another economic shock or obvious bad trend in economic figures to trigger investors to realise things aren’t rosy and push them into action to look for ways to protect themselves.

And the reason we haven’t seen more mainstream portfolio managers come into gold is, well, because they are mainstream. They’ll be the last ones in and will be the buyers that current gold holders sell to - although you’ll want to be sure you can distinguish between a bubble and nascent hyperinflation before you make that decision to sell.

The answer to the question really is that individual investors all have different views on whether, as Philip puts it, “we are going to see a loosening of monetary policy globally, continued crisis in the eurozone and negative real interest rates, inflation expectations rising” all of which is “a pretty powerful stimulus for gold investment.”

Download today’s full Blog Watch (pdf 199kb) for more reviews, including:

SPROTT SILVER TRUST PREMIUM A TRADING SIGNAL

In this 321gold.com article Bob Moriarty says that investors “can use extremes of emotion as measured by the Sprott Silver Trust [premium] to gage silver buy points and sell points.”

GOLD:PLATINUM RATIO

In his short article Hubert Moolman looks at the ratio of gold prices to platinum prices and concludes that “the Gold/Platinum Ratio also supports significantly higher gold prices over the coming months.”



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Deflation, Hyperinflation And The Alchemy Of Risk

Topics [ gold investing sell gold gold bullion prices ]

BLOG WATCH

Talking of volatility, Zero Hedge has Artemis Capital’s latest research paper on the topic. It is pretty heavy going but will be of interest to those following the seeming never resolved deflation/inflation debate. I’ll do my best summarising their key points.

Artemis argue that investors currently have “a profound emotional fear of deflationary collapse”. The result is they are overpaying for insurance (i.e. financial products) that they believe will protect them against deflation. Artemis see the high cost of this insurance as being “driven by forced participation in risk assets from artificially low interest rates and financial oppression.”

In other words, investors would rather protect themselves from deflation by holding cash, but with cash rates so low (resulting in negative returns after inflation) they have been forced to go into stocks but compensate by bidding up insurance on these as they really don’t like the risk of stocks. Note that some of that “I’m losing on cash but don’t want stocks” money is flowing into gold.

Artemis then ask what happens “when all these buyers look to cash in on their expensive tail risk insurance all at the same time. The jackpot is a lot smaller when everyone owns a winning lotto ticket. All that expensive protection will likely underperform expectations ...”

Artemis paper then moves to focus on a risk they think is not being considered by the market – hyperinflation – noting that “it is not currently fashionable to talk about the risks of hyperinflation in modern developed economies. If you merely mention the concept you are quickly relegated to being an apocalyspe junkie, gold bug, or someone who spends too much time looking at the Mayan calender.”

To continue reading this article, download today’s full Blog Watch (pdf 197kb). This issue also includes:

CANNY INVESTORS NOW PRICE SENSITIVE

Jeffrey Christian of CPM Group makes a number of good points in this interview with Hard Assets Investor.

LONG-TERM HOLDERS WORRIED

P Radomski of Sunshine Profits reports that they are now “getting worried e-mails and questions from investors who are holding long-term positions.” Are Perth Mint Depository clients voicing the same concerns?

GOLD MOVING OUT OF BANKING SYSTEM

In this King World News interview, Egon von Greyerz reveals that he is “seeing big money moving gold they own out of the banking system and into the vaults outside of the banking system.”



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Blog Watch For 3rd April 2012

Topics [ gold bull market silver bullion prices sell gold invest in gold ]

BLOG WATCH

Casey Research on when to sell

Hard to go past an article with this tagline: “Revealed – the simple economic indicator that will tell you when it's time to sell gold.

For the busy, here’s the punch line: “When real rates turn positive, especially above 2%, it may be time to sell. We'll have to see what's going on in the world at that time; if there's financial chaos, the fear factor could cause gold to depart from this historic pattern.”

It is another good piece by Casey Research and worth a read because negative real interest rates are a significant long term driver of gold prices.

Download today’s full Blog Watch (pdf 190kb) for more reviews, including:

Clive Maund - Technical Analysis

Clive considers gold’s recent trading behaviour to be one of consolidation and sees two alternative explanations of the pattern, both bullish.

Mark Faber on Bloomberg TV on gold

Mark has a different assessment. However, he’s not selling his gold!

Dominique de Kevelioc de Bailleul (Beacon Equity Research) on silver

On volatility, Dominique thinks silver investors should “get over it, or get out!”

James West (Midas Letter Money) interviews Rick Rule and Eric Sprott

There’s an important element in this interview which refers to gold’s role as insurance for your investment portfolio.

Richard Karn (The Emerging Trends Report) on Australian gold producers

Richard has been travelling around Australia researching the the gold sector - and sees a lot to like.


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Buy Low, Sell High – We’ve Got The Perfect Tool To Help You Succeed

Topics [ buy gold online sell silver buy silver online sell gold gold prices silver prices ]

WEBSITE INFORMATION

In his recent post, Bron answered the question How Are Perth Mint Gold And Silver Spot Rates Calculated?

The next logical question for bullion buyers might be “how do I follow every change in The Perth Mint spot rate throughout the trading day?”

For many, the spot price graphs on our homepage are useful for deciding when to buy or sell precious metals.

However, for those that don’t have time to watch the graph all day long, there’s a better option – as many small investors have already discovered.

Automatic Email & SMS Price Alerts

For everyone registered to buy on www.perthmintbullion.com, we offer a free, automated ‘Price Alerts’ service.

Here’s how it works.

You choose the metal(s) you are interested in and set a ‘low’ price at which you want to buy and a ‘high’ price at which you’d consider selling.

As soon as our spot rate hits either of these upper and lower limits, the service triggers an immediate personal alert via e-mail or SMS.



These prompts are designed to ensure you’ll never miss a potential buying or selling opportunity in today’s volatile market.

Thousands of our registered buyers are already relying on Price Alerts, suggesting that this invaluable tool is helping investors in their aim of “buying low and selling high”.

Please register or login now to set up your own bullion Price Alerts.

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