The past 48 hours have been extraordinary for those who sell bullion. It all started with a group on Reddit, the same group that focused on Game Stop stock last week, turned their attention to precious metal – specifically silver. It led to a rush to buy as much bullion as available with many companies having to halt sales over the weekend. The Mint on Monday was no exception to this rush.
When the push to buy bullion began roughly 48 hours ago, many of the Mint’s Authorized Purchaser companies saw unprecedented demand for silver. APMEX ended sales of silver bullion at the end of Saturday because of concerns over the price-per-ounce as well as being able to meet demand. Sales resumed on Monday but orders are now delayed several days as the Oklahoma based company sorts out the fulfillment of those orders. JM Bullion was no exception either. Their CEO reported to CNBC that normally they sell about a million ounces of silver per weekend. This past weekend alone they sold 27 million ounces.
For its part, the United States Mint has also seen incredible bullion sales to Authorized Purchaser companies in the past 48 hours.
- 1.571 Million American Eagle Silver Bullion Coins. The Mint sold 650,000 in all of February 2020.
- 207,000 American Eagle Gold 1-Ounce Bullion Coins. The Mint sold 3,500 in all of February 2020
To add more color, in the first month and one day of 2021, the Mint has sold 6.346 million American Eagle Silver bullion coins. That is 21% of the total sales of silver Eagles in all of 2020 – literally 32 days into the year. It is an incredible pace.
The question now becomes one of stability. Will this upward trend continue? Silver closed at its highest level in 8 years on Monday and while it has retreated some this morning, the general trend upwards is likely to continue as bullion is scarce in the open market.
I’m old enough to remember the Hunt Brothers trying to corner the silver market in 1980. That did not end well for them as the higher the price went the more scrap was found which they had to buy to maintain the level, obviously a losing game and they ended up losing a fortune. Maybe this time the spot price will settle higher, though chasing the crowd doesn’t sound like a good investment strategy. I expect the Mint will raise prices on its products though..and be slow to drop them too.
You’re 100% on about the Mint. It will raise prices for sure….