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HistoryStudent | 05-23-2008 02:13 PM
Per Wall Street Journal - US rationing SILVER EAGLEs Collectors angered as U.S. rations 'silver eagles' Submitted by cpowell on 08:28AM ET Friday, May 23, 2008. Section: Daily Dispatches Losing a Mint: Curb on Coin Sales Angers Collectors U.S. Begins Rationing Popular 'Silver Eagles'; How $1 Fetches $19 By Ianthe Jeanne Dugan The Wall Street Journal Friday, May 23, 2008 The government rationed food during World War II and gasoline in the 1970s. Now it's imposing quotas on another precious commodity: 2008 dollar coins known as silver eagles. The coins, each containing about an ounce of silver, have become so popular among investors seeking alternatives to stocks and real estate that the U.S. Mint can't make them fast enough. In March the mint stopped taking orders for the bullion coins. Late last month it began limiting how many coins its 13 authorized buyers worldwide are allowed to purchase. "This came out of nowhere," says Mark Oliari, owner of Coins 'N Things Inc. in Bridgewater, Mass., one of the biggest buyers of silver eagles. With customers demanding twice as many as they did last year, Mr. Oliari would like to buy 500,000 a week. But the mint will sell him only around 100,000. The coins have a face value of $1. But the mint sells them for the going price of silver, plus a small premium, to a handful of wholesalers, brokerage companies, precious-metals firms, coin dealers, and banks. The dealers mark the coins up a bit more and sell them to the public. Currently, the coins are fetching about $19 apiece, with some sellers seeking more than $20. For Coins 'N Things alone, the shortage is costing hundreds of thousands of dollars in lost sales of silver eagles. The firm sells about $1 billion worth of precious metal every year, including silver, gold, and platinum coins. Mr. Oliari, a 50-year-old numismatist who has been in the business since 1973, sniffs: "You can't print what I want to say about the mint." The mint, a bureau of the U.S. Treasury, has offered little explanation beyond a memo last month to its dealers. "The unprecedented demand for American Eagle Silver Bullion Coins necessitates our allocating these coins on a weekly basis until we are able to meet demand," the mint wrote. A spokesman declined to elaborate. ... 'Poor Man's Gold' The rare shortage offers a glimpse into the growing love of a commodity known as "poor man's gold." With more silver mined than gold traditionally, silver has always been far cheaper than gold and today has less than 2% of gold's value. But silver is growing in popularity, and some investors are betting that its value will surge as inventory shrinks. Big investors are loading up on silver eagles, which are the only American silver coins allowed in individual retirement plans. For small investors, they are an accessible way to get into the metal boom. "Unlike gold, these coins can be bought by regular citizens," says J.R. Roland, a Brownsville, Tenn., judge who recently began buying the coins -- and trading them on eBay. "In these economic hard times, silver coins are a great way to invest." In March, sales of silver eagles surged more than ninefold from the previous month, to 1.85 million. This year, the mint has sold 6.8 million, representing more than twice last year's pace. Still, numismatists are clamoring for millions more as the price of silver soars. It has more than doubled in the past three years and now trades at around $17 a troy ounce, which is slightly heavier than a traditional ounce. Linda Wood, a 57-year-old Pittsburgh accountant, scours eBay, coin shops, and flea markets in search of silver eagles. One by one, she has accumulated about 300 in the past few months and stores them in a bank safe-deposit box. Traditional coin collectors may be impressed with the government's written description of silver eagles as "one of the most beautiful coins ever minted." But Ms. Wood isn't in it for aesthetics. She became a silver bug after she and her husband saw the value of their individual retirement accounts decline by $2,500 -- a "significant" chunk. "I just need bullion," she says. "I wouldn't care if the coins were ugly." Amid the mint caps, shady silver-eagle hawkers are thriving. Some coins are priced at $25 and higher. Mr. Roland says that he had to wait a month after ordering some on eBay recently, because the sellers didn't even have the goods. "I can't wait long, because you never know what's going to happen with the price," he says. In Manitowoc, Wis., Dan Zirk, owner of Manitowoc Card & Coin, has sold twice as many silver eagles as he did last year. So he has stashed away his remaining handful of 2008 coins, betting the price will rise. "I want $22 apiece," says Mr. Zirk. He says customers, meanwhile, are asking for earlier years and other forms of silver. ... Lady Liberty The government began producing silver eagles in 1986, basing its design on Adolph Weinman's 1916 "Walking Liberty" half dollar. The front features a flag-draped Lady Liberty striding toward the sunrise, carrying branches of laurel and oak symbolizing civil and military glory. On the reverse, a design by John Mercanti features an eagle with a shield, olive branch, and talon and arrows. The coins are made at an armored facility in West Point, N.Y., alongside the military academy. Dealers say they heard the mint had run out of planchets -- round metal disks ready to be struck into coins. The disks are used for various coins, and the companies producing the blanks also are busy, limiting the mint's ability to increase production. The mint won't comment on the planchets. ... Coins Divvied Up Each Monday morning now, the mint divides its silver coins into two pools. It divvies up the first equally among authorized purchasers. The second is allocated proportionately, based on the buyer's past purchases. The mint limited purchases once before -- in the late 1990s, when investors loaded up on silver, wrongly anticipating that a failure by the world's computers to adjust to the new millennium would cripple the economy. Jim Hausman, head of the Gold Center in Springfield, Ill., one of eight companies in the U.S. authorized to buy silver eagles, estimates that the rationing will cut his expected annual sales of four million silver eagles in half. And the result, he says, is almost un-American. Increasingly, investors are taking a shine to alternatives. The Royal Canadian Mint saw its sales of silver Canadian maple-leaf bullion coins rise 40% last year, to 3.5 million, according to a spokesman. Some investors expect the craze to end badly. They draw comparisons to what happened to silver in the 1970s. A rich Texas family poured billions of dollars into silver, and prices surged above $50 an ounce in 1980, only to plunge again after government intervention. "It's akin to what happened when the Hunt brothers tried to corner the silver market," says Wendell Curry, who owns McAllen Gold & Silver Exchange in McAllen, Texas. "The silver hawks are now trying to corner silver American eagles. And it's making it harder for mom and pop to buy these for their grandchildren." * * * Join GATA here: Vancouver World Resource Investment Conference Sunday-Monday, June 15-16, 2008 Vancouver Exhibition and Convention Centre http://www.cambridgeconferences.com/ch_june2008.html * * * Help Keep GATA Going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at http://www.gata.org/. GATA is grateful for financial contributions, which are federally tax-deductible in the United States. Contact GATA info@gata.org Gold Anti-Trust Action Committee 7 Villa Louisa Road Manchester, Connecticut 06043-7541 USA www.gata.org Recommended Sites Recommended Internet sites for daily monitoring of gold and precious metals news and analysis. Free sites: http://www.24hgold.com http://www.jsmineset.com http://www.marketwatch.com http://www.mineweb.com/ http://www.gold-eagle.com/ http://www.kitco.com/ http://www.usagold.com/ http://www.usagold.com/amk/usagoldmarketupdate.html http://www.GoldSeek.com/ http://www.GoldReview.com/ http://www.capitalupdates.com/ http://www.DailyReckoning.com http://www.goldenbar.com/ http://www.silver-investor.com http://www.thebulliondesk.com/ http://www.sharelynx.com/ http://www.mininglife.com/ http://www.financialsense.com http://www.goldensextant.com http://www.goldismoney.info/index.html http://www.howestreet.com http://www.depression2.tv http://www.moneyfiles.org/ http://www.minersmanual.com/minernews.html http://www.a1-guide-to-gold-investme...vs-dollar.html http://www.goldcolony.com http://www.miningstocks.com http://www.mineralstox.com http://www.freemarketnews.com http://www.321gold.com http://www.SilverSeek.com http://www.investmentrarities.com http://www.kereport.com (Korelin Business Report -- audio) http://www.plata.com.mx/plata/home.htm (In Spanish) http://www.plata.com.mx/plata/plata/english.htm (In English) http://www.resourceinvestor.com http://www.miningmx.com http://www.prudentbear.com http://www.dollarcollapse.com http://www.kitcocasey.com http://000999.forumactif.com/ http://www.golddrivers.com/ http://www.goldpennystocks.com/ http://www.oroyfinanzas.com/ http://www.goldinvestments.org/ http://coininfo.com/ http://www.insidegold.com/ http://www.goldmau.com/ Subscription sites: http://www.lemetropolecafe.com/ http://www.hsletter.com http://www.interventionalanalysis.com http://www.investmentindicators.com/ http://www.caseyresearch.com/ http://www.deepcaster.com/ Eagle Ranch discussion site: http://os2eagle.net/SSL/phpentry.php Ted Butler silver commentary archive: http://www.investmentrarities.com/ Recommended Gold & Bullion Dealers Coin and precious metals dealers who have supported GATA and been recommended by our members: Blanchard & Co. Inc. 909 Poydras St., Suite 1900 New Orleans, Louisiana 70112 888-413-4653 http://www.blanchardonline.com Centennial Precious Metals Box 460009 Denver, Colorado 80246-0009 1-800-869-5115 http://www.USAGOLD.com Michael Kosares, Proprietor cpm@usagold.com Colorado Gold 222 South 5th St. Montrose, Colorado 81401 http://www.ColoradoGold.com Don Stott, Proprietor 1-888-786-8822 Gold@gwe.net El Dorado Discount Gold 13014 North Dale Mabry Highway Suite 133 Tampa, Florida 33618 623-643-8785 http://www.eldoradogold.net Contact: Eric Levenson eric@eldoradogold.net Gold & Silver Investments Ltd. 63 Fitzwilliam Square Dublin 2, Ireland ...and Tower 42, Level 7 25 Old Broad St. London, EC2N 1HN United Kingdom Local Call Ireland: 1-850-GOLD-IE UK phone: +44 (0) 207-060-4653 International: +353 1-632-5010 Fax: +353-1-6619664 www.gold.ie GoldMoney Net Transactions Ltd. ASL House 12-14 David Place St. Helier, Jersey JE2 4TD Channel Islands, UK International: +44-1534-760-133 GoldMoney.com Investment Rarities Inc. 7850 Metro Parkway Minneapolis, Minnesota 55425 http://www.gloomdoom.com Greg Westgaard, Sales Manager 1-800-328-1860, Ext. 8889 gwestgaard@investmentrarities.com Jaxville Gold and Silver Trading Co. 4901-48 St. Parkland Square, Lower Mall Red Deer, Alberta, Canada http://www.jaxville.com Jack Fortin, Owner and Operator 403-346-5266 auric@telus.net Kitco 178 West Service Road Champlain, N.Y. 12919 Toll Free:1-877-775-4826 Fax: 518-298-3457 ...and 620 Cathcart, Suite 900 Montreal, Quebec H3B 1M1 Canada Toll-free:1-800-363-7053 Fax: 514-875-6484 http://www.kitco.com Lee Certified Coins P.O. Box 1045 454 Daniel Webster Highway Merrimack, New Hampshire 03054 http://www.certifiedcoins.com Ed Lee, Proprietor 1-800-835-6000 leecoins@aol.com MRCS Canada 12303-118 Ave. NW Edmonton, Alberta T5L 2K2 Canada http://www.mrcscanada.com Michael Riedel, Proprietor 1-877-TRY-MRCS 1-877-879-6727 mrcscanada@shaw.ca Miles Franklin Ltd. 1001 Twelve Oaks Center Drive Suite 1028 Wayzata, MN 55391 1-800-822-8080 http://www.milesfranklin.com Contacts: David Schectman, Andy Schectman, and Bob Sichel Missouri Coin Co. 11742 Manchester Road St. Louis, MO 63131-4614 info@mocoin.com 314-965-9797 1-800-280-9797 http://www.mocoin.com Resource Consultants Inc. 6139 South Rural Road Suite 103 Tempe, Arizona 85283-2929 Pat Gorman, Proprietor 1-800-494-4149, 480-820-5877 Metalguys@aol.com http://www.buysilvernow.com Silver Trading Co. 445 Montgomery St. PO Box 876 Shreveport, Louisiana 71107 Larry LaBorde, Proprietor 318-470-7291 LLaBord@silvertrading.net http://www.silvertrading.net Swiss America Trading Corp. 15018 North Tatum Blvd. Phoenix, Arizona 85032 http://www.swissamerica.com Dr. Fred I. Goldstein, Senior Broker 1-800-BUY-COIN FiGoldstein@swissamerica.com The Moneychanger Box 178 Westpoint, Tennessee 38486 http://www.the-moneychanger.com Franklin Sanders 1-888-218-9226, 931-766-6066

Twisted Avatar | 05-23-2008 03:07 PM
Re: Per Wall Street Journal - US rationing SILVER EAGLEs Bit by bit ........ the reality that silver is the most manipulated commodity on the planet is being understood by the masses. Get on board before they wake up....... the silver tsunami is off in the distance. T

blueice | 05-24-2008 10:30 AM
Re: Per Wall Street Journal - US rationing SILVER EAGLEs Good thread HS...Of course, leave it to the government to fail to perform..:banghead:

Twisted Avatar | 05-24-2008 12:45 PM
Re: Per Wall Street Journal - US rationing SILVER EAGLEs Quote:
Originally Posted by blueice (Post 1116809) Good thread HS...Of course, leave it to the government to fail to perform..:banghead:
Their "failure to perform" has created the greatest gift to the average person that had common sense to find out about and research the silver story. When that silver window finally dose slams shut ........ it will be like a clap of thunder heard around the world. T

Mike_Templar | 05-24-2008 03:16 PM
Re: Per Wall Street Journal - US rationing SILVER EAGLEs What do they mean, "Unlike Gold, silver can be bought by regular citizens?" Did I miss something over the past few days?!??

Master_Ho | 05-24-2008 04:33 PM
Re: Per Wall Street Journal - US rationing SILVER EAGLEs Quote:
Originally Posted by Mike_Templar (Post 1117043) What do they mean, "Unlike Gold, silver can be bought by regular citizens?" Did I miss something over the past few days?!??
I read that and wondered to - finally settled on that he was just figuring the average person was too broke to afford gold! :D

Twisted Avatar | 05-24-2008 04:46 PM
Re: Per Wall Street Journal - US rationing SILVER EAGLEs Quote:
Originally Posted by Master_Ho (Post 1117107) I read that and wondered to - finally settled on that he was just figuring the average person was too broke to afford gold! :D
Yeah ........ had to be...... average person is not walking around with a thousand bucks to filp on a single coin. But most certainley dose have a extra 20 bucks to blow if the mood strikes them. T

Gold Rules | 05-25-2008 08:14 AM
Re: Per Wall Street Journal - US rationing SILVER EAGLEs Quote:
Originally Posted by Twisted Avatar (Post 1117116) Yeah ........ had to be...... average person is not walking around with a thousand bucks to filp on a single coin. But most certainley dose have a extra 20 bucks to blow if the mood strikes them. T
...........+ 1............around here the mood strikes ......often....

Twisted Avatar | 05-25-2008 08:26 AM
Re: Per Wall Street Journal - US rationing SILVER EAGLEs Quote:
Originally Posted by Gold Rules (Post 1117639) ...........+ 1............around here the mood strikes ......often....
I can personally attest to that ...... There have been days when I had nice meal at a dinner and I see the bill is for almost 19 bucks and I grit my teeth.:banghead: You look at stuff and start to price it in silver.....it is amazing. T

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