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Guess who is running low on Silver! - Page 4
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Thread: Guess who is running low on Silver!

  1. #31
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    And after a few emails today, the Perth Mint did confirm that it physically holds the precious metals that back its certificates.

    "I can confirm that The Perth Mint does maintain possession of sufficient physical silver for unallocated storage as is required to completely meet the commitments of the PMCP."

  2. #32
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    Mar 2008
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    Up until a year or so ago (from my vague memory) the price of silver was under $10 an ounce. Do you really think that if you purchased silver with a certificate from the Perth Mint before that time that they then instantly purchased silver on the open market and then stored it in a hi-tech secure warehouse complete with guards, dogs, etc, for the 10-20 years before you decided you might wander down and pick it up?

    If I bought a tin of baked beans from the local supermarket and then said keep it on the shelf for me for ten years and then I'll pop down and pick it up, do you think the supermarket owner would look upon me with kindness and affection?

    In other words as a business model this silver system would be something even a charity would choke on.

    I'd read the fine print on what 'backed by silver' means.. in case I ended up looking like a chump.

    And if they do have your silver in storage, why when you want to pick up the physical silver do they make you wait weeks while they pour a bar for you and charge you the current smelting costs?

    I smell a rodent humungous.

  3. #33
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    Well, as Silver isn’t perishable, the baked bean analogy doesn’t really work, but I get the point if you are talking about storage costs.

    However, they have to maintain and store a “float” of silver to support their minting activities, so I would assume that incremental costs required to expand that storage system to hold additional unallocated silver for their certificate program would be factored into their sales margin.

    Regarding the 10 day fabrication time, my guess is there are overheads with running a bureaucracy of public servants. When my local council take 2 months to approve development plans when all other authorities take 2 days, I usually shrug my shoulders and chalk it up to government inefficiency rather than a conspiracy to defraud. But who knows!

    When we live in a system where banks create their own money to loan out at interest to an unwitting public, I have to concede that anything is possible and nothing is necessarily sensible. Ultimately, investing is all about one’s personal risk appetite. At this stage I haven’t overcome the security constraints for personally holding bullion, but this may change as priorities change and I may be better equipped in the future.

    My priorities, like many, I would posit, are not based on biblical prophecy or doomsday scenarios, but are a dynamic mix of many things. I’m not desperately clinging to a point of view or trying to justify a particular position, but I do appreciate your concern.

  4. #34
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    Default I think its a combination of both...

    ....not wanting to sell at low prices or a loss, and a real shortage of physical silver at the consumer level.

    There is such massive manipulation by the IMF and central banks who hold most of the worlds stores of precious metals that it is utterly mind-blowing.

    The people who are behind the world's money and banking systems are the largest scale criminals who ever lived.

    America is going to be forced to swallow the Amero whether we gag on it or not.

  5. #35
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    Mar 2008
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    It's sage advice...

    http://news.silverseek.com/TedButler/1207680184.php

    "There continues to be a running discussion on pool and unallocated silver programs. Those who issue or sell such accounts continue to insist that real silver backs every dollar deposited by investors. But all that has been forthcoming has been words, not proof. As I have previously written, it is important to "trust, but verify."

    Unfortunately, I am aware of no issuer that has actually verified that real silver backs any pool or unallocated account. And to do so would be a snap. Just list the serial numbers and weights of the 1000 oz bars backing these programs. If Barclays can do it for the 184 million ounces in their silver ETF, why canít the issuers of the pool and unallocated accounts do so as well?

    Here are some simple questions for investors and potential investors in pool or unallocated silver programs. Whatís in it for the issuers of such accounts? How do they make money if they actually buy real silver, store it for you, and donít charge storage fees? Are they in business to do you a favor at no profit to themselves? Would you do that if you were them? If you canít answer these simple questions, and lacking the published serial numbers, a reasonable person would have to conclude that there canít be real silver backing these programs."

  6. #36
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    Australia
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    Yes, I read this this morning and it is a point well made. Why not publish their inventory level as validation of their holdings?

    As for the profit question, I am assuming that guarantees on the buy and sell price margins, the effects of compound growth, plus the spread would be justification enough to provide the service. But let’s see . . . using a spreadsheet and a few facts it is easy enough to calculate their gross profit margin.

    The facts are:

    Sales margin on Int’l Ask price = 2%
    Spread between Ask & Bid = 2.85%
    Purchase Margin on Int’l Bid price = 1%

    Well, unfortunately I can’t post my spreadsheet into this message, but it tells me that they make about 5.93% on every deal, before expenses. Is it worth it? Well, that would depend on how they account for expenses, but it’s definitely not great business.

    Yes, the point is very well made and leaves a big question mark over this program.

  7. #37
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    Mar 2008
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    Because the Perth Mint is goverment owned its structure of operation could be investigated by the ombudsman if a complaint or question was raised with him/her.
    An investigation could then perhaps reveal the industry world wide structure of silver trading.
    I cannot believe the Perth mint holds physical stocks around the world for every silver certificate it sells - otherwise when you purchase the certificate you would have to pay smelting costs and be given a serial number and a location for your silver. If you are not given this then what do you really have?
    A compulsory investigation by the ombudsman could have worldwide ramifications.

  8. #38
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    A compulsory investigation by the ombudsman could have worldwide ramifications.
    Bring it on...

  9. #39
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    So I called up the Australian Bullion Company today to check on the state of my bullion order that I they told me would be 2 weeks and now they say it will be an extra week. But apparently I'm lucky because they have since changed their terms to 6 weeks for delivery. Seems the market has gone crazy and they just can't mint enough bars to keep up with demand. . . but they aren't putting up their price relative to the spot.

    It's strange, and I guess that's what people have been saying all along, but the price is obviously artificially low and with tonight's London sell-off, its going even lower. . . although I see New York has started buying now. Sure is a crazy see-saw ride at the minute.

    I notice also that Global Speculator has put the case for the vulnerability of the A$ if the Reserve Bank holds or drops interest rates. That will certainly give some uplift to Aussie PM investors.

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