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Gold, Silver & Platinum 2009 First Quarter Performance

March 31, 2009 by Leave a Comment

With the first quarter at an end, let’s take a look at the performance of gold, silver, and platinum so far this year.

When putting the numbers together, I knew what to expect, but its still surprising to see where the final numbers landed. Gold, silver, and platinum’s performance relative to one another has basically been turned upside down from the 2008 annual performance.

2009 First Quarter Gold, Silver, and Platinum Performance
30-Dec-08 31-Mar-09 Change Percent
Gold 869.75 916.50 46.75 5.38%
Silver 10.79 13.11 2.32 21.50%
Platinum 898.00 1,124.00 226.00 25.17%

For 2008, gold had performed the best with a gain of 4.32%, followed by silver with a loss of 26.90%, with platinum in last place with a loss of 41.31%.

As you can see the performance for the first quarter of 2009 has been the opposite with platinum performing best with a gain of 25.17%, followed by silver with a gain of 21.50%, with gold in last place with a gain of 5.38%.

Platinum and silver were in some respects recovering from the beating they took last year. Over the past several years gold has emerged as more of a steady performer, as compared to the more volatile performance of the other metals, commodities, equities, real estate, etc. It’s ironic that whenever a mainstream publication discusses the possibility of investing in gold, they never fail to caution about gold’s “volatile” prices.

At any rate, precious metals outperformed stocks for the quarter, mostly by a wide margin. The Dow, S&P 500, and Nasdaq lost 14.29%, 12.81%, and 3.07% respectively.

Filed Under: Gold, Platinum, Silver Tagged With: , , ,

Gold and Silver Market Manipulation, Paper Market Crash, Platinum Jumps

February 12, 2009 by Leave a Comment

Beneath Cash4Gold’s shiny veneer, a dull reality

The Cash4Gold Superbowl ad certainly brought the company a lot of mainstream attention. However, it also brought to light many questions about their payment levels and practices.

Gold ETF inventory increasing at record pace

An interesting observation from the author. When the pace of increases spikes, the price of gold usually follows.

Vindication

OK, someone has to say it: Why is the fact that a few banks hold massive concentrated short positions in gold and silver undeniable “proof” of manipulation? Couldn’t it be possible that the banks are simply making a big, dumb bet that will lose them massive amounts of money in the future? It certainly would not be the first time…

Paper gold market will crash at Comex

From the article: “I believe that the comex will default and the entire paper gold market will crash and gold could rise very quickly to 2000 until 3000 US Dollars. When this happens it will be too late to exercise or to try purchasing physical gold.”

Russia Sberbank gold sales jump during crisis

Looking at gold investment demand in Russia. Quote from the article: “We have clients who bought 200-300 kilograms of gold.”

Platinum Jumps to Highest Since October on Investment Demand

The industrial metal jumps on investment demand.

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Gold and Silver ETF, Gold vs. Platinum, Gold Revaluation Debate

January 16, 2009 by Leave a Comment

It’s another Gold and Silver Blog Round up, exploring some gold , silver and precious metals related articles and blog posts from around the web.

COMEX commercial positions favor silver: Gold Gold Report

A comprehensive report including premiums on physical gold and silver, positioning of COMEX futures traders, and gold and silver ETF updates. To start of the year, SLV and GLD both reached new highs for tonnes in the trust.

Gold vs. Platinum: Is There a Favorite?

Comparing gold and platinum. Includes a nice illustration on the ratio of platinum to gold. Remember when they briefly reached parity?

Is President Obama Wearing a Giant Gold Mask?

Laying out the case for gold confiscation or really “gold revaluation” as a tool to restart consumer spending and revive the economy.

Gold revaluation – Clutching at golden straws

A response to the gold revaluation theory and the China Gold theory.

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Platinum Tops $1,000, 2008 Average Price of Silver, Bearish call on Gold

January 10, 2009 by Leave a Comment

A brief round up of some of the more interesting gold, silver, and precious metals articles and events from the past week.

Platinum Tops $1,000 on Stimulus Outlook; Gold, Silver Drop

Even as gold and silver fell, platinum continued its recent move and topped the $1,000 mark intraday for the first time since October.

Silver News and Views

Even though silver lost more than 25% during 2008, it’s average price for 2008 posted a gain of nearly 12%. The included chart of the annual average price of silver looks impressive.

Merrill Lynch says rich turning to gold bars for safety

An article on the highly publicized remarks from Merrill Lynch’s chief investment officer regarding gold. Wealthy clients want physical gold.

A Bearish Call on Bullion

The editors of gold timing newsletters are more bullish now than they have been in three and a half years. The author sees this as a bearish sign, even amidst the admission that government manipulation may play a role in the price of gold.

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US Mint Unveils New Pricing Policy

January 7, 2009 by Leave a Comment

The US Mint unveiled a new pricing policy which covers all Gold and Platinum Numismatic Products. This pricing policy does not refer to any of the bullion offerings, but only the numismatic products which the US Mint sells to coin collectors. The new policy represents a significant shift in the handling of collectible coins with precious metals content.

The US Mint cites “fluctuating gold and platinum commodity costs” as the reason for the change.

In the past, the US Mint has announced prices for products one to two weeks prior to release. The pricing was presumably based on the market price of the precious metals content plus production costs and a profit margin. This initial price could only be adjusted via publication of new pricing in the Federal Register. Since this process takes time, price changes were preceded by sometimes lengthy suspension periods. Even during the most volatile years for precious metals, prices were changed only three to four times at most.

The US Mint’s new pricing policy will allow them to change prices as frequently as once per week. Price levels would be set based on the average weekly price of gold based on London Fix prices for the preceding week, Thursday to Wednesday. If the average price moves across certain thresholds, prices will be adjusted up or down on Thursday at 10:00 AM ET. The new policy will go into effect January 12, 2009.

This is a significant change of policy that will make numismatic products seem more like bullion products, albeit with very high premiums. It will be interesting to see how this new policy sits with coin collectors and whether there will be any kinks in the implementation.

Below is the text of the US Mint’s notification published in the Federal Register.

[Federal Register: January 6, 2009 (Volume 74, Number 3)]
[Notices]
[Page 493-496]

DEPARTMENT OF THE TREASURY

United States Mint

Notification of New Pricing Methodology for Numismatic Products
Containing Platinum and Gold Coins

SUMMARY: The United States Mint is implementing a new pricing methodology for its numismatic products containing platinum and gold coins to mitigate the effect that fluctuating gold and platinum commodity costs has on the pricing of these products. The new pricing methodology is based primarily on the London Fix weekly average (average of the London Fix prices covering the previous Thursday a.m. Fix through the Wednesday a.m. Fix) platinum and gold prices, which reflect the market value of the platinum and gold bullion that these products contain. As required by law, the prices of these products also must be sufficient to recover all other costs incurred by the United States Mint, such as the cost of minting, marketing, and distributing such products (including labor, materials, dies, use of machinery, and promotional and overhead expenses). This pricing methodology will allow the United States Mint to change the prices of these products as often as weekly so they better reflect the costs of platinum and gold on the open markets.

DATES: The new pricing methodology, as further explained in the SUPPLEMENTARY INFORMATION section, will go into effect on January 12, 2008.

SUPPLEMENTARY INFORMATION: Pursuant to the authority that 31 U.S.C. 5111(a)(3), 5112(i), 5112(k), 5112(o), and 5112(q) grant the Secretary of the Treasury to mint and issue gold and platinum coins and to prepare and distribute numismatic items, the United States Mint sells to the public numismatic products containing American Eagle Gold and Platinum Coins, American Buffalo Gold Coins, First Spouse Gold Coins, and the 2009 United States Mint Ultra High Relief Double Eagle Gold Coin. In accordance with 31 U.S.C. 9701 31 U.S.C. 9701(b)(2)(B), the United States Mint is changing the prices of these coins to reflect a new methodology in pricing.

Effective January 12, 2009, the United States Mint will commence selling numismatic products containing American Eagle Gold and Platinum Coins, American Buffalo Gold Coins, First Spouse Gold Coins, and the 2009 United States Mint Ultra High Relief Double Eagle Gold Coin at prices established by using the new pricing methodology. Specifically, each Wednesday, the United States Mint will apply the average London Fix for platinum and gold (average of the London Fix prices covering the previous Thursday A.M. Fix through the Wednesday A.M. Fix) to the below pricing schedules. Price adjustments as a result of this process, if any, will be effective at 10 a.m. E.S.T. on the immediately following Thursday.

The pricing charts included with the release follow. Click for large version.


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Did Platinum Just Break Out?

January 3, 2009 by Leave a Comment

After falling below the $900 level in late October, Platinum spent more than two months trading in a relatively tight range between $780 and $900.

In the final days of 2008, Platinum pushed above $900 and now stands at $946. This recent move looks bullish to me.

Chart courtesy of stockcharts.com

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2008 Gold, Platinum & Silver Performance

January 2, 2009 by 2 Comments

As trillions of dollars in equity values were vaporized this year, a strong November and December performance pushed gold into positive territory by year end. Gold’s annual gain was 4.32%. This marks gold’s eighth consecutive annual gain. The “lost decade” for stocks, has been quite the opposite for gold. Silver and platinum were less fortunate, posting losses of 26.90% and 41.31% respectively.

(Figures calculated from Kitco’s London PM Fix prices)

The headline numbers only tell part of the story. I rounded up a bit more data which paints a more complete picture of the 2008 performance of gold, silver, and platinum.

Gold Silver Platinum
Dec 31, 2007 Close 833.75 14.76 1530.00
Dec 31, 2008 Close 869.75 10.79 898.00
Annual Change +36.00 -3.97 -632.00
Percentage Change +4.32% -26.90% -41.31%
2008 Low 712.50 8.88 763.00
Change from start to low -121.25 -5.88 -767.00
Percentage Change -14.54% -39.84% -50.13%
2008 High 1011.25 20.92 2273.00
Change from start to high +177.50 +6.16 +743.00
Percentage Change +21.29% +41.73% +48.56%

The first section of the table above shows the performance of gold, silver, and platinum from start to finish during 2008. The second section lists the lowest closing price for each metal during 2008, and calculates the percentage change from the start of the year to the low price. The final section lists the highest closing price for each metal during the year, and the percentage change from start of the year to the high price.

Some observations:

Often when the mainstream press writes about gold as a potential investment option, they usually caution that prices are “extremely volatile.” A look at the figures above shows otherwise. While it seemed like a year of extremes for gold, at its lowest it was down 14% and at its highest it was up 21%, probably making it one of the least volatile investments of 2008.

Platinum, which is starting to draw my interest, basically went straight up during the month of February to its peak price of $2,273 per ounce. Then it experienced three months of nearly continuous declines from mid-July to mid-October where it reached its low of $743 per ounce. At its high it was up nearly 50%, at its low it was down more than 50%. Briefly, the price of gold exceeded the price of platinum, but the situation has now reverted to the norm.

Silver experienced a similar plight, up more than 40% at its peak and down more than 40% at its low. The period of decline also took place from mid-July to mid-October. Many have pointed to the enormous concentrated short position taken by a handful of banks in July as responsible for the decline.

On a housekeeping note:

Sorry for the lack of posting on Gold and Silver Blog during the end of December. I should be back on a regular schedule for the new year. I aso plan to add some new sections to the site, which compile historical data relevant to gold and silver watchers. Thanks for reading and let’s make 2009 a great year!

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Two Milestones for Gold

December 18, 2008 by 3 Comments

In the past week, gold quietly marked two important milestones.

First, as of Monday the price of gold is now showing a gain for the year. The closing price of gold on December 31, 2007 was $833.75. The price of gold today is $854.60.  That makes gold up 2.5% for the year to date. If gold can hang onto this gain into the end of the year, this will also mark the eighth year in a row that gold has had a positive return. For the year and for this decade, gold has humbled its naysayers and rewarded its investors.

Second, on Tuesday the price of gold exceeded the price of platinum. The two metals now trade within a few dollars of each other with gold at $854.60 and platinum at $858. This is a big change from earlier in the year when platinum was trading over $2,200 per ounce, more than double the price of gold. If I’m not mistaken, the price of platinum has been higher than the price of gold for this entire decade. Not since the 1990’s has gold been more expensive than platinum. Considering that platinum is thirty times scarcer than gold, this makes a strong statement about the demand for gold.

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US Mint to Sell Final Inventory of 2008 Platinum Eagles & 1/10 oz. Gold Eagles

October 25, 2008 by 2 Comments

A few weeks back the US Mint announced that they would be taking unprecedented actions to deal with the demand for bullion coins. This included production halts for some bullion coins and limited production for others until existing blank inventories were depleted. Read the full US Mint memo with details of the actions.

Yesterday the following memo was released announcing that starting Monday, the US Mint will resume taking orders for the remaining 1/10 oz. Gold Eagles and Platinum Eagles. The memo also provides some insight into how the US Mint will ration the remaining supplies.

October 24, 2008

MEMORANDUM TO ALL AMERICAN EAGLE BULLION COIN AUTHORIZED PURCHASERS

SUBJECT:       2008–Dated Bullion Coin Products

On Monday, October 27, 2008, the United States Mint will resume taking orders for 2008-dated American Eagle One-Tenth Ounce Gold Bullion Coins and all sizes of American Eagle Platinum Bullion Coins.

Final inventory for these bullion coins is based on current in-house blank supplies and some supplies are very limited.  The United States Mint will allocate these remaining coins among the Authorized Purchasers (APs).

The United States Mint will use a slight modification of its standard allocation process, which is as follows:

Monday morning, the inventory available for sale that week will be divided into two equal pools for each bullion coin product.

The first pool for each bullion coin product will be allocated equally to all active American Eagle Gold One-Tenth Ounce and American Eagle Platinum APs respectively (active APs are those which have purchased American Eagle Gold One-Tenth Ounce or American Eagle Platinum Bullion Coins in the past three fiscal years).

The second pool will be allocated based on each AP’s sales performance for each bullion coin product in the last three fiscal years (e.g., an AP who purchased 30% of all American Eagle Gold One-Tenth Ounce Coins during this time will be allocated 30% of this second pool).

Each AP will be advised via fax Monday morning (or if a government holiday, Tuesday morning) of its allocation, and will have until 3 p.m. on the following Friday to place an order for its allocated coins.

Any unordered coins remaining after 3 p.m. Friday will be put back into the pool for allocation the following Monday only until coin inventory for each product is depleted.

Included in the communication with each AP’s initial allocation on October 27 will be its allocation percentage based on sales performance.

Please note: The inventory for the American Eagle Platinum One-Tenth Ounce Bullion Coins is very limited and will be allocated to the Authorized Purchasers with the highest sales performances for the past three fiscal years for this product.

Available inventory will remain on allocation each week for the American Eagle Gold One Ounce and American Eagle Silver Bullion Coins.

We will keep you informed when more information becomes available for the American Buffalo Bullion Coins.

Thank you for your patience and your continued support of the United States Mint Bullion Coin Program.

Filed Under: Gold, US Mint Tagged With: , ,

Gold and Silver News & Headlines

October 23, 2008 by Leave a Comment

Links to a number of interesting or notable gold and silver news stories or blog posts:

Platinum Almost the Same Price as Gold

Safe haven metal versus industrial metal. Will we reach parity?

Taking delivery of 1 to 5 million ounces a month

A very innovative idea… actually taking delivery of physical silver from the Comex.

Yes, We Have No Silver

Have you recently tried to buy physical silver near its market price? Here is the brief tale of one man’s frustrating quest.

Gold ETF Reaches One Dollar Per Tonne

Even though the price of gold recently experienced a rapid decline, “tonnes in the trust” barely moved. As the author says, “For gold, the price goes down, but investors don’t sell.”

Blog Catalog Verification

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