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Sprott:Silver Investment Up, Silver Price Down, What's Up?

Sprott Asset Management notes record sales of US silver eagles and net in flows into silver ETFs in 2013 and yet the price of silver has gone down in 2013

http://sprottgroup.com/thoughts/



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Perhaps retail sales are up because the price is down.

The ETF, SLV, is easy to figure. Its physical holding increases when the retail buyer is willing to pay a premium to spot (plus accrued fees), and falls conversely. In other words, changes in SLV's inventory reflect a recent mismatch in the retail and spot market prices.

Ĵīɣȩ Ɖåđşŏń

"Fully half the quotations found on the internet are either mis-attributed, or outright fabrications." - Abraham Lincoln

that's a good point

however after a while if demand stays robust at a lower price and supplies dwindle, prices should go up, but to your point demand may drop if prices rise.
I think however what is happening is manipulation of the paper price

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For every buyer there is a seller

Volume of sales does not necessarily correlate positively with price.

Ĵīɣȩ Ɖåđşŏń

"Fully half the quotations found on the internet are either mis-attributed, or outright fabrications." - Abraham Lincoln

True but with Newly minted silver that's not the case

the mint is creating silver eagles with silver. This depletes the available silver

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14,223,000 Silver eagles sold so far in 2013

vs 242,000 gold eagles

At $32 an ounce of silver the 14.2 million silver eagles sold so far this year = $455,000,000

at $1650 an ounce of gold the 242K gold eagle sold=$399,000,000

The dollar amounts are similar but the to satisfy the silver demand for coins requires 58X more silver!

There is only 7x more silver available than gold

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I have some Sprott Silver and Gold stocks

they have done nothing but loose me dollars. :(

I'd rather have a bottle in front o' me than a frontal lobotomy
www.tattoosbypaul.com
www.bijoustudio-atx.com

yes the entire precious metals sector esp the miners

have been slammed the past two years as the FIAT printing proceeds unabated.

This in spite of central banks buying and the public buying

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I never know if I should get out

or stay in...I dont own hardly any stocks/etf's, but i do own Sprott.

I'd rather have a bottle in front o' me than a frontal lobotomy
www.tattoosbypaul.com
www.bijoustudio-atx.com

if we knew when to buy and sell we'd be millionaires!

One can be generally right but have your timing off.

Keynes once said-(probably one of the only things worth quoting him for) "Markets can stay irrational longer than you can remain solvent"

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Very true

it was money I was prepared to loose...hopefully silver will break before my stocks go to zero. haha. I had plenty of physical before I even considered gambling some of my money away, so...we will see what happens!

I'd rather have a bottle in front o' me than a frontal lobotomy
www.tattoosbypaul.com
www.bijoustudio-atx.com

I suppose its relatively safe to say that at least

silver and gold won't ever be worthless-someone would want it at a minimum for adornment as jewlry or just to hold and look at :-)

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Sprott has also noted with respect to silver

that there is about 7X more silver available for investment but it is being bought in multiples of 30-50X more than gold.

He runs two precious metal ETFs and the amount that investors bought in dollar amounts for his gold and silver funds were about the same (both hundreds of millions of dollars worth) BUT that means at the current price of silver he has to buy far more silver than gold.

Sprott posits this type of demand will eventually catch up with the price.

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Demand for Silver Eagles in 2013 is at a record high

People are buying silver eagles in multiples far more than they are buying the gold eagles

Take a look at the mint figures-this year silver is being sold in record amounts but the price of silver on the Comex is flat

http://www.usmint.gov/mint_programs/american_eagles/index.cf...

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