Howdy folks,
Some of you are riding this bull and some are tempted. At this moment, for most investors, if I wanted to establish a position, I'd Dollar Cost Average. I'm a momentum investor and have been scaling in until I reach my target allocation. What your target allocation should be varies enormously from investor to investor. For years I suggested 3-7% for most, preferably in physical bullion. Yeah, that can get sticky but cripes, a roll of American Gold Eagles is slightly larger than a quarter in diameter and stands 2-3" tall. At todays prices it's worth about $90K. You can hide it in your box of oatmeal. As for silver, a 100 oz bar is worth about $5K and you can paint it black and use it as a door stop. Buy some bling for you and your spouse.
Note: I don't trust bullion ETF funds generally as they are based upon an enormous amount of paper. I do trust Sprout. For paper investing, it's them, PRPFX and junior silver and gold miners with SILJ and SGDJ.
Spot price is determined in the commodities market and is paper and manipulated enormously. The price you pay is spot plus the premium. The premium varies by the type of bullion you're buying. I've attached the quote sheet from my local coin dealer. It lists the premium for every type of bullion. Note that better types are more than others and that volume buying lowers the premium. Top shelf costs more than rot gut.
https://libertycoinservice.com/daily-price-quotes/Right now the LBMA has come up against a shortage of physical bullion and more and more contract holders are requesting physical delivery of their contractual bullion. This has increased the demand for pure bullion ingots .999%. Couple this with the increased demand from individual investors and more particularly from various central banks around the world and you see a perfect example of artificial pricing. The spot price was around $3.00 below the 'street' price. Premiums are soaring. When the paper price is lower than the street price, one of two things occurs. The street price goes up [increased premiums] or supply dries up. "Sorry, we're all out."
One last thing. Because London is so desperate for physical bullion, the refiners in this country are refusing to except 90% silver (old U.S. coinage pre-1964), not because it's not valuable, but because they don't have time to refine it to .999% pure. Ah, but this has resulted in the premium on 90% silver going to around zero. Best buy in town. Having a couple of rolls of quarters and dimes in the safe, doesn't sound like a horrible idea.
and so it goes,
peace,
rono
