As the silver price surged nearly $4 this week, premiums on Silver Eagles also increased. Due to the high demand for Silver Eagles, the premiums for the coins are still the highest versus competitors. This is part of the reason that Silver Eagle sales in July are much lower in ratio to the Gold Eagles, as I explained in my previous article, Gold Eagle Sales Already 3X Last Year’s Total & U.S. Mint Still Struggling To Produce Silver Eagles.
At the beginning of the week, silver started trading at $19.75, reached a high of $23.67, and then closed on Friday at $22.86, according to Stockcharts.com. As I also mentioned in previous articles, there is a difference between Kitco.com’s silver spot price and those quoted on Investing.com and Stockcharts. Kitco.com uses the London Metals Exchange (LME) quote, and Investing.com and Stockcharts use the Chicago Mercantile Exchange (CME). Thus, in one week, the silver price increased a bit more than $3 or 15%.
With rising silver prices, the precious metals dealers also have to increase their premiums. However, from Wednesday to Friday, the 2020 Silver Eagle premium percentages began to rise more than the increase in the silver price. The chart below shows the leading four online dealers average 2020 Silver Eagle premium versus Cloud Hard Assets (based buying 1-19 coins):
Since the beginning of July, the four leading online dealers’ average 2020 Silver Eagle premium was 43% of the silver spot price and then trended lower to 40% on Tuesday, July 21st. However, over the next three days, the four leading dealers’ average 2020 Silver Eagle premium increased to a monthly high of 45%.
In contrast, CLOUD HARD ASSETS started the month with a 30% premium on its 2020 Silver Eagle coins, it then fell to a low of 25% on July 22nd, and is now 28%. So, the difference between the two is 13%. With the average spot price for the four leading dealers being $22.90, the group’s total premium for a 2020 Silver Eagle was $10.27 per coin versus $6.48 from CLOUD HARD ASSETS.
I am still surprised that the largest online dealer, who is one of the U.S. Mint’s Authorized Purchasers, is charging the highest premium for its 2020 Silver Eagles, and other silver bullion coins. Here are the four leading dealers versus Cloud Hard Assets 2020 Silver Eagle prices as of close on Friday (based on buying 20-99 coins):
Again, the largest online precious metals dealer is charging nearly $2 a coin higher than its competitors. CLOUD HARD ASSETS is the only dealer that is charging less than $30 for the 2020 Silver Eagles.
Some people have emailed me asking if the prices Cloud Hard Assets is charging is TOO GOOD TO BE TRUE or a SCAM. Even one commenter stated the following in the blog:
“Yes keep saying CLOUD HARD ASSETS, where else can you pay almost half the premium of anywhere else on the market??? I wondered myself if it was a scam, but have now made two large orders through DAN at CLOUD.”
There is a reason I sponsor CLOUD HARD ASSETS on my website because I believe they are one of the most honest and upfront dealers in the industry, which also provides some of the best prices and services. Another commenter said that he had been using the largest online dealer for ten years and had no problems. I say… GREAT. If you don’t mind spending $2-4 more per coin to buy your 2020 Silver Eagles from the largest dealer (who should be offering better prices via higher volume), then I don’t have a problem with it. However, if you do… then I’d suggest you shop around.
It’s going to be interesting to see how the gold and silver prices trade next week and in August. Some believe we may see a nice correction. Others are saying that if the stock market crashes again, then the gold and silver prices may fall along with it. This could be true. However, it’s a WIN-WIN situation for gold and silver? Why?
If prices continue higher, we will get more physical buying, which will put even more pressure on available supply. If the gold and silver prices fall hard again, we will see even more buying than we did in March-April, when the Dealers’ silver inventories were wiped out. So, precious metals investors should be prepared for either scenario.
IMPORTANT UPDATE: I will be posting an exciting Silver Update on Sunday Night. It seems as if the Silver market is experiencing a significant change that may lead to much higher prices.
You can contact Tom or Dan at CLOUD HARD ASSETS here: PRECIOUS METALS INVESTING.
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Readers here occasionally post anecdotal stories about how their local coin dealer who has always had inventory for sale, now has very limited or none for sale, or they close before noon because they are sold out.
I track my local coin dealer by the listed inventory on his website. He told me there are times he is too busy to update it for 1-3 days. But based on what I see people are selling some gold becasue it is near its all time high, and perhaps they want currency for something they want or need.
I don’t see much silver being added to his inventory, although if someone or their spouse has lost their job, or had an unexpected expense they may sell.
I’m pretty sure he is only buying mint silver “monster” boxes very rarely, as his price is higher than a larger online retail dealer, or Cloud HA, because although Cloud is small in employees, he has deep contacts and volume discounts.
My local coin dealer, like most local coin dealers, gets most of what he sells from those that sell to him, not from wholesalers.
There may come a time local dealers have even less silver inventory than they do now.
What you say above, DC, is exactly what my coin shop says. What little they have is from long time customers selling because of bills. He told me yesterday that he has heard many sad stories from his long time customers. Side note….. I live in a 170,000 north Florida University town. The students are beginning to trickle back to town. It has been a total ghost town since March. The homeless are the worse we have ever seen, by far. Panhandlers everywhere, and some fine looking/clean folks on the street corners also(they could be clean to get attention, but one can tell they are not use to being on the streets begging). Took the dog to the park yesterday, and three came up to us asking for handouts….. we carry. Hate to have to use it, but we will. Look at the mess in Portland, and Seattle, just to name two. We are home at night, with our doors locked, and our “mean” dog. Hang in there all. Looks like I’ll be ordering from Cloud this week(my first time).
Meanwhile, in my lcs, no one is selling. Lots of gold being bought…LOTS and some big purchases. The proprietor is paying over $28 ea. for ASE’s to resell. He nearly croaked at buying a MB to sell. 6 months ago, he had 10-15 MB’s in the shop and was p and m about “no one wanting silver” so he traded them for gold to his distributor.
A couple of us told him to sit on them. Premiums were $3 bucks then. He was buying them for under $9k per if I recall.
NOW…he is really pissing and moaning.
I have gone to that shop for over 10 years. He has always been far more of a gold guy than silver. His disrespect for silver has now bitten him in the ass big time.
Let’s not let that happen here. IMO, the investment demand for Ag will skyrocket.
No one will be selling. Most of the Ag is in “the strongest hands” and they are tired of this shit. Silver has been shown total and complete disrespect as a natural resource.
That is about to change.
Amen
There’s been times in history that silver has been slightly devalued because it’s heavier than gold to hold the same money value. I was reading about how in the wild west for example the monetary GSR was at times 16:1 even though it should have been more like 10:1 based on quantity but there was a penalty for it being so heavy to carry on horseback or stagecoach etc…so gold was highly preferred for carrying wealth around and it was easier to hide as well. Not sure if this is true but it makes sense. Makes me think the LCS guy probably bitches about how heavy silver is.
You can tell such well groomed beggars are not used to begging eh? Better wake up. It means the smart swindlers have moved in, able, even thru their drug fog to not only clean up but appear innocent and inexperienced. Enough to fool you, apparently.
Such times are coming but in our current dystopia no one who has enough health to walk and stand on corners needs to beg. Still plenty of food stamps etc and even if not you can always find a way to make yourself useful enough to someone to get food and a cot.
You’re wasting your time and money buying pm if you’re in a neighborhood where you can’t even walk the dog without packin
and being hit up 3 times.
Flag will go up soon, and you won’t last 20 seconds, gold or not
You broach an interesting mystery. Sure, a person who owns both metals and needs funds may chose, as you postulate, to keep their silver, thinking (erroneously) the gold has less far to run.
But many in similar need hold only silver and are perhaps even closer to the edge, being less affluent. So you’d think dealers would be getting more silver according to your premise.
I’ve found the Dealer buyback prices for silver to be disrespectful. For example: Provident metals sale price for a silver eagles is $34.49 for less than Qty 20. Their buy back price is $24.10 and I have to eat the shipping. That’s a 30% delta. No one is getting my silver for that price.
Therein lies the problem.
The spread is much closer on other major sovereign coins.
ASE’s enjoy cult-like following
Add a zero and we’ll start thinking about it. 😉
My mama told me, you gotta shop around.
Yes, this disrespect/lack of interest has bothered me to. With the wholesalers charging 20% premium according to Lastman and others, specifically why do dealers lowball this and what will change situation?
They will pay more [increase what they are offering] if they can’t get enough to meet resell demand.
Hi Dc,
Yes, of course, but posed question cause this conventional explanation doesn’t seem to fit. Ie, From anecdotes I have heard personally and online including Lastman, maybe you, Dealers are blaming high prices and low supply on wholesaler premiums while failing to mention their own crappy buy offers.
If in truth they are getting enough input off the street then I’m very surprised as as Pete infers it seems few would sell back to dealer at such low price, especially in bull metal market with lots of “free” money still pumping
Hey Steve, thanks for your work, been following for awhile. Typo in para 2 above, I’m sure you meant $23.67? Cheers.
Stuart,
Correct. Thanks, made the edit.
steve
Forget about ASEs, why pay substantially more for the same amount of silver? I just stick with buffalo rounds and other privately minted rounds. If you must own sovereign coins, Britannias and Philharmonics are significantly cheaper than ASEs.
We have arrived, Steve, after all these years of taking heat for investing in precious metals. Even in the comments on this site, we were told we’re idiots, should be buying bitcoin, blah blah.
Most PM stackers were disillusioned by the rise and fall of prices during the last recession, but I think people knew something funny was going on and the FED is not going to pull the same trick this time. I stuck to my guns because I had been there before in the 90s, so for the last few years, the lower the price, the more I bought and the cows are coming home now.
Brant Lee,
Agreed. Check out my newest video to be published later this evening. BIG CHANGE seems to be taking place in the SILVER MARKET
steve
I think the extra-high premiums we’re seeing are taking into account much higher prices coming soon. If you want to buy some of my silver, I’d put a whopping premium on it too. But I ain’t selling, so, as Pink Floyd might say, keep your hands off of my stack!
I’m watching BTC this week. Thinking it continues to move up loudly throughout the week…..’cuz TPTB certainly want to get people looking someplace other than GOLD or SILVER They’ll have plenty of different headlines to distract with this week too. We started pretty quick tonight, but most of the time metals get hit by Monday mornings NY open. Still….it sure seems to me that with SILVER we’ve changed…..that instead of dime size moves we’ve become a dollar move ‘market’
Far too many articles in the last few months are not much more than advertisements for Cloud Hard Assets. Every now and then would be fine but it’s getting ridiculous lately. Sad.
Florida prepper,
While you are welcome to your opinion, no one is forcing you to read the material.
Furthermore, 70% of my traffic is NEW VIEWERS. So, 7 out of 10 people who read this article are NEW to my website. Do you think they deserve to know about the large price difference in premiums for Silver Eagles??
Gosh, I find it simply amazing that people think the world revolves around themself. And even worse, they complain when they receive this information for FREE. I receive a lot of positive feed-back from many new followers who used Tom Cloud and saved a lot of money. I try to show these once a week at the most.
Think about this before you say it’s ridiculous when you fail to realize that there are a lot MORE PEOPLE READING THIS WEBSITE THAN YOU.
steve