Massive demand for precious metal prompting buyers to pay at least 15 per cent premium
Paul Joseph Watson
Thursday, September 30, 2010
One ounce gold American Buffalo coins are selling for nearly $200 dollars above spot on eBay following the US Mint’s announcement that it had run out of the highly sought after coin and would not restock supplies amidst soaring gold prices.
The one ounce Buffalo, which is particularly desirable due to its pure 24-karat content, is selling for significantly more than its actual spot price value, with one auction on E-bay attracting a winning bid of $1500, nearly $200 above the current price of gold.
Indeed, the US Mint is selling its few remaining Buffalo coins for a whopping $1560, at a premium of over $250.
“And even this massive premium over “NAV” has not stopped the flood of retail buying,” writes Tyler Durden of Zero Hedge. “Either this, or the mint has been ordered to redirect all physical holdings of ultra pure gold into the vaults of LBMA dealers for physical sequestration. Our money is on the latter, now that there is a major run on physical gold both in retail demand, in ETFs and in virtually every other market. We expect to see more global gold dealers to announce inventory depletions shortly.”
Sellers usually achieve a price marginally above the actual price of gold to cover commission, but $200 higher represents a difference of over 15 per cent, with gold currently hovering just above the $1300 level.
“The United States Mint has depleted its inventory of 2010 American Buffalo One Ounce Gold Bullion Coins,” the Mint said in a statement earlier this week, adding that no more would be minted until next year’s run.
Gold is soaring on the back of a crumbling dollar in the aftermath of the Federal Reserve’s indication that it would once again be cranking up the printing presses in preparation for QE2.
As a result, predictions for gold prices are through the roof. Immediate forecasts have the precious metal at $2000 in the near term, with double that figure a reasonable target by 2012 as a consequence of hyperinflation.
In a recent speech at the University Club in New York City, successful hedge fund magnate John Paulson said that gold could hit as high as $4000 in the next couple of years as a consequence of double digit inflation.
At the extreme end of the spectrum, Omnis senior managing director James Rickards forecasts that gold will soar to anything up to $11,000 in the aftermath of a dollar collapse. “It’s not really a forecast, it’s simple math and it’s where we’ll end up once the dollar collapses,” Rickards told astonished CNBC anchors.
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Paul Joseph Watson is the editor and writer for Prison Planet.com. He is the author of Order Out Of Chaos. Watson is also a fill-in host for The Alex Jones Show. Watson has been interviewed by many publications and radio shows, including Vanity Fair and Coast to Coast AM, America’s most listened to late night talk show.
This article was posted: Thursday, September 30, 2010 at 10:30 am