My LCS Owner Says, "I've stopped selling US 90% silver."

[Know Common Cents]

I've been buying silver in most forms from my LCS for many years. I know this person. I know his family. Above all else, I trust his opinion.

Yesterday, I asked him if I could purchase some of the US 90% silver that had just come to his side of the counter this week. He said a firm, "No." He added, "I'll sell you Warnix or US 40%, but I'm holding my US 90% because something big is about to happen."

I've been following some of the recent RC commentary about thin supplies of 90% and escalating premiums over melt. I agree that the GDP (Generally Dumb Public) is waking up to metals. Many of the people who have enough discretionary income to even consider jumping into an investment they've been told was horrible can identify with the silver equivalents of their current quarters, dimes and the occasional half buck. Might have even spent them as a kid.

Jumping into US 90% seems to be a logical entry point for first timer silver investors. Having purchased their first batch several months ago around the Presidential election, many have already graduated into purchasing ASEs and MLs with fists full of cash. Look at the real or contrived shortages of these 2013 version coins and one could seen another trend.

Think of the logic that, "If I can't get silver Eagles or Maples, I'll grab some more US 90% until they become more readily available." They've already established their comfort level with those.

Back to my LCS. This is a high-volume place, but the owner's unwillingness to sell any US 90% is because he feels the trend is decidedly higher. He said, "Even if the POS drops below its recent sagging retreat from $32 TOZ, the premium for US 90% will more than make up for that." In other words, he believes the premiums for coin silver will increase more than any new price drop.

What did I buy? Some Warnix and some 40% Kennedys, of course.

[aaa30040]

I asked last week at the local pawn shop about silver and was told the owner keeps any that comes in - none is for sale

[NHsorter]

I asked last week at the local pawn shop about silver and was told the owner keeps any that comes in - none is for sale

Same thing at the vast majority of PS's that I have been in around here.

[beauanderos]

I asked last week at the local pawn shop about silver and was told the owner keeps any that comes in - none is for sale

"none for sale" will become more widespread as the price climbs... or until it climbs a sufficient level for some of the more savvy to let loose of some of their 90%. The alternative is .999, which (although not abundant in some preferred forms) seems to be available still at online dealers in sufficient size to meet current demand. That can change, tho

[neilgin1]

thats a really good share KCC.....i appreciate that. one is really seeing that in the Ebay market...rolls....i saw a first the otherday, a roll of 58-d Franklins, BU's went for 40 times face...outside of the 55's, i;ve NEVER seen a roll of Franklins go for 40 times, and about 5 days ago, i saw a roll of 1970-s Kennedy Proof's got for 227, and there was a mini-mob bidding on those, said mob was NOT noobies.

this was surprising because its always seemed to me, that 40%'ers were always kind of like 'the red haired step child' of the silver market.

i feel good, coz i spent the weekend buying rolls of 90%'ers. i got ANOTHER roll of 64 Kennedy Proofs, from the same seller, (got three rolls)....and these rolls MUST of came from a collector, who knew what they were doing, because 90% of the coins are absolutely flawless. (for those interested, she does have another roll of 64 proofs listed, i'm done, so here's the listing:
http://www.ebay.com/itm/ROLL-20-1964-KE ... 0883602451 ......check out the bidders, one guy with 2466 stars, another with 584...gonna be interesting

heck, while i'm at it, here's a guy offering a roll of 64 Kenn at 284 "buy it now"...wonder why this guy hasnt been picked off:
http://www.ebay.com/itm/380546826928?ss ... 1423.l2649 )

this whole thing, the rumblings about shortages, and guys not selling, a LOT of new particpants, this is all reminding me of how it went down with guns and ammo.

people warn and warn, but you can still "get in"....then one day, out of nowhere, BAM!...something happens, and you cant get in, you cant find anything to buy, the dribbles and drabbles you can find are priced 300% higher from the day before...and then...theres NOTHING.

i also, this weekend found two rolls i'd never seen before, solid date Barber Halves,...yeh sure, they're G4-VG8's....but so what, i got a roll of 1906-D and a roll of 1915-S Barber halves....the 15's have some F12's in 'em.

one question, did your LCS owner expound on what this "something big happening" might be?

my gut is telling me, we're going see some rock-n-rolling in the Mid-east...out of nowhere, crude oil has been the "tell".

[JobIII]

I don't know if this post is just a statement or a cry for help. So I took a look at the WTB/BIN forums and here is what's available on RC at the moment.

For rolls of 90% check out these links:
http://realcent.org/viewtopic.php?f=28&t=20920
http://realcent.org/viewtopic.php?f=28&t=21045

And here for smaller units of 90%:
http://realcent.org/viewtopic.php?f=28&t=20532

And here for even smaller units of 90%:
http://realcent.org/viewtopic.php?f=28&t=21075

So even if your LCS and PS are holding their 90% for that potential home-run at some point in the future, there are deals to be had here on RC right now.
~JobIII

[68Camaro]

I think the overall point is that the market is currently tight. Ray just happens to have a few rolls he's selling this week to generate some cash, but he's recently tightened up a lot on how much he is selling. And while you do have some 90% the selection options are more limiting. And for both of you, the premiums are now well above melt, whereas only a few weeks ago melt was was typical. It's a tighter market that it was just a few weeks ago.

[JerrySpringer]

Kind of coincidentally, I was thinking about 90% silver this morning. I was thinking that why do I even think silver is relevant and why it might be dead money for a number of years to have acquired silver. Most came through CRH so my cost basis is pegged to the time and gas money, wear and tear on car, etc. so it was a pleasure of a hobby perhaps. Still is, with benefits. Ultimately, holding onto it should be a wise thing in the long run. Reasons are that it is silver and it is "antique". As long as the general public still sends their 90% heirloom coinage to the melting companies, there will be a steadily diminishing supply of authentic 90% silver. I am thinking by the time our grandkids are in the prime of their lives, a cache of silver coins could be a windfall for them. Price of silver one thing, but rarity and maybe a kitsch-niche thing for 20th century "real" money could be a rage a good number of years from now. Who knows, but like land, they are not making anymore 90% 1964 Kennedy half-dollars.

[JobIII]

I personally have not seen a tightening of supply here in New England. Most LCS that I call or visit simply sell out their supply about as fast as it comes into the store. So the issue is merely can you get to the store before someone else buys everything up.

[beauanderos]

I personally have not seen a tightening of supply here in New England. Most LCS that I call or visit simply sell out their supply about as fast as it comes into the store. So the issue is merely can you get to the store before someone else buys everything up.

that's THE definition of tight supply. You can hardly call it abundant if it sells out as fast as it comes into the store I know there have been days when I checked RC and BS every five minutes and had nothing to show for it.

[slvrbck]

I got the same problem down here. . . supply isnt tight, there just isnt any available.

[db23]

Funny how when Ray stops selling in his regular volume there's a nationwide supply shortage.

[HPMBTT]

In answer to the Op's original post....I believe part of it is due to the temporary shortage of 2013 ASE's from the Mint. So naturally, some people are looking elsewhere for their silver fix ie 90% junk silver at coin shops, among other things. Once the Mint acquires new stock, some collectors/investors will go back and spend their FRN's on over-priced silver (aka ASE's) and everything will be OK. Well...maybe not everything. Yes, I agree that some people are holding for the long term; for example, I haven't sold any silver at all in a very long time. Plus, there are new investors that are getting onboard recently. Sign of the times, folks.

[beauanderos]

Funny how when Ray stops selling in his regular volume there's a nationwide supply shortage.

There's been more than one occasion when I had more 90% than APMEX (that's really ridiculous if you think about it!!!)... they've written to me in the past trying to buy some, offering a premium of $2.50 above melt (2008). I expect that will happen again. They're welcome to all my culls

[beauanderos]

Sign of the times, folks.

The current "shortage" of 90% is a good training course for what all forms of silver will see as the price climbs in multiples from this VERY suppressed valuation point. People will turn to gold because silver will disappear. Online delivery times will stretch out at all the majors like it currently does at Northwest Mint. Your best bet could become buying directly from a silver miner (for instance, First Majestic). When you see, not only 90% coins, but also most desirable forms of one ounce rounds at major dealers become scarce (or shipping with longer and longer delays)... and only 100 oz bars and larger are to be had... you'll know the time has passed to get onboard the silver train.

[scyther]

Not to be a downer, but I think you guys are going a little overboard. Even if your LCS is totally sold out, you can still buy some online. And as for it "not being available at any price"... aren't shortages supposed to be impossible in a free market? Yes, I know we don't have a totally free market, but there aren't any price controls on silver, so why wouldn't the price just rise? I can't imagine you won't be able to get some if you have enough money.

[natsb88]

Your best bet could become buying directly from a silver miner (for instance, First Majestic).

But NWT does all of FM's minting.

[beauanderos]

Not to be a downer, but I think you guys are going a little overboard. Even if your LCS is totally sold out, you can still buy some online. And as for it "not being available at any price"... aren't shortages supposed to be impossible in a free market? Yes, I know we don't have a totally free market, but there aren't any price controls on silver, so why wouldn't the price just rise? I can't imagine you won't be able to get some if you have enough money.

online dealers depend, in part, in LCS funneling bulk lots of silver to them... that's the end point of a distribution system that begins with Craiglsist or ebay (weak hands selling to stronger hands), and makes its way up the line. If there's a bottleneck at any point (fewer ebay sellers, folks waiting for higher prices) then supply from the big guys will dwindle... and then dry up... while their premiums increase. These various threads that have sprung up in the last month address just the scarcity of 90%, unrelated to other forms of bullion. But the day will come when it gets alot harder to source most forms of silver. Whether that precedes a force majeure at COMEX is anyone's guess. Since I feel that, ultimately, the govt is behind the price suppression schemes, you're probably going to witness a very long sideways trending market (if they have their way, and why wouldn't they... with the ability to absorb ANY paper losses... and guess what? The taxpayers will be the ones bailing out JPMorgan when they fail... since they're "too big to fail")

When physical silver becomes impossible to find, you'll finally see the paper price cleave from the physical price. Buy now, anywhere you can (at reasonable cost) while you can... before Joe Public wakes up. You, fellow members, have been handed a gift... the opportunity to stack at what will someday be seen as having been an incredible value.

[SoFa]

A dealer who won't sell his coins is not much of a dealer in my opinion. He sounds like he's become a stacker.
Dealers buy it, mark it up and sell it. The repeat. They generally make more that way instead of waiting for something big to happen someday.

[neilgin1]

I got the same problem down here. . . supply isnt tight, there just isnt any available.

THAT......was good, it made me laugh...nice.

[JobIII]

I personally have not seen a tightening of supply here in New England. Most LCS that I call or visit simply sell out their supply about as fast as it comes into the store. So the issue is merely can you get to the store before someone else buys everything up.

that's THE definition of tight supply. You can hardly call it abundant if it sells out as fast as it comes into the store I know there have been days when I checked RC and BS every five minutes and had nothing to show for it.

Well this may be the definition of a tight supply. I think I didn't explain my POV well enough. My local LCS never seems to store their 90%. So I just meant to say that the status quo hasn't changed in my area.

~JobIII

[neilgin1]

When physical silver becomes impossible to find, you'll finally see the paper price cleave from the physical price. Buy now, anywhere you can (at reasonable cost) while you can... before Joe Public wakes up. You, fellow members, have been handed a gift... the opportunity to stack at what will someday be seen as having been an incredible value.

that is EXACTLY how i'm looking at this...."before Joe Public wakes up"....amen,...Ray, dear friend, dont think for an instant i'm not aware of this 'gift' we've been given of a sideways banding market.

and now. i've stumbled on a new gift, i'm actually enjoying some nusimatic aspects of stacking American silver coinage.

i REALLY enjoy coming to this forum, more so than any other forum i've visited and posted at in the 14 years i've been cyber connected, the fellowship is good, and everyone posts to one another, with the same respect, as if we were all in the same room....its HIGHLY unusual to see on the Net. You go to other places, forums, or where comments are allowed?......oh my, most disheartening....but here?

its pleasurable, and my wishes are that everyone here flourish in the coming days ahead, from the heart, neil

[barrytrot]

Joe Public will never wake up, so take that out of your calculations

[beauanderos]

Joe Public will never wake up, so take that out of your calculations

ok... you're right about that. But at some point in time the 1% that are savvy will double to 2%... and then go to 3%... a tripling of demand would be all it would take to set this thing in motion.

[barrytrot]

Joe Public will never wake up, so take that out of your calculations

ok... you're right about that. But at some point in time the 1% that are savvy will double to 2%... and then go to 3%... a tripling of demand would be all it would take to set this thing in motion.

I agree, that is possible.

So your original premise makes sense as triple demand should spike prices and substantially reduce supply. I'm still not convinced there will be a "disconnect" between physical and paper, but it should spike both physical and paper at the very least.