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Bullion premiums now normal

Gold has held well over $900 per troy ounce. Silver spiked to the higher end of the $14 range and platinum fell on its butt! Why? The answer is more fear coupled with depressing economic news. Gold reacted to fear. Silver and platinum reacted to the possibility of lower industrial production/need.

The premiums on nearly all bullion items have returned to the normal levels of a year ago. Only the fractional gold and platinum issues maintain higher premiums because of no new production. Those premiums should slowly dissipate as production comes online. If demand remains limited as production comes on, these recent issues could have historically low mintages.

Older U.S. gold issues are a little softer. Major buyers are more selective in regard to quality and grading. A few months back a lightly cleaned gold $20  did not matter if it looked nice. Now it is the “kiss of death.”

There are numerous jumps and dips for early type, especially in pre-1840 dollars and halves. Common Barber halves are soft in higher Mint State grades. This is a result of gold/silver buyers that are active today. Nice BU Barbers often show up at their buying locations and are bought for a song. These buyers sell them for whatever current dealer bid is. If that gets recorded on the trading networks, that bid becomes the new ask, even if it was one transaction.

E-mail harrymkrause@optonline.net.

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