Make Kitco Your Homepage
Contributed Commentaries
  1. Kitco Metals Inc.
  2. Commentary Archive
  3. Bio

An Open Letter To Mining CEO's

Specifically to those who mine gold and silver.

Consider changing the policy of shipping your product into the warehouses that supply bullion which backs up futures contracts.  This procedure is helping those who are depressing the price that you receive for your bullion!

Instead you need to ‘starve the paper market’, and think of ways to convert your bullion into retail products.  There is rapidly growing demand on the retail side for finished products!  Here are some examples:

Featured are some examples of 1 ounce ‘Rounds’ produced by Johnson Matthey. 

This one ounce round is very popular with silver investors and is available at coin dealers and precious metals distributors like Kitco.com.  This 1 ounce silver round and many similar rounds are currently being produced by a number of private mints including Sunshine Mint, Golden State Mint, Silvertowne, Johnson Matthey and others.

                               
Here is the obverse of the Buffalo 1 ounce round, manufactured by the Silvertowne Mint in Indiana.

Shown here is a 1 ounce round that is produced at the Sunshine Mint in Idaho.

Golden State Mint has created this traditional ½ ounce pure silver round.

This one ounce round is produced by the Native American Mint

There is no end to the many different products that can be created in pure silver, and are purchased by collectors and investors, like these pure silver bullets.  Those of you who are producing raw silver are urged to contact a silver refinery and work out a marketing plan for finished product.

--->Finally here is one more suggestion.  When you sell your silver or gold bullion, don’t put the money in the bank where it could end up being targeted during bail-ins, or almost certainly subject to negative interest rates.  Instead buy shares in a gold or silver trust such as the Sprott Gold Trust, or the Sprott Silver Trust, or Central Fund, or any trust where the goods are audited on a regular basis.  These trusts will then use your money to buy bullion to store in their vault, away from the futures warehouses where it is used to back up futures contracts.  If you believe in your product, you will reap a profit from ownership of shares in bullion trusts that are sure to continue to benefit from the bull market that began in 2002!

Here are several charts (courtesy Stockcharts.com), to prove that point.

Featured is the monthly gold chart with its 24 month moving average.  In 2002 price broke out at the 24MMA to start a 9 year rally.  From 2013 until recently, this moving average has proven to be strong resistance.  In February, for the first time in 14 years, price broke out above this MA again.  A testing of the breakout is taking place at the moment and a close above $1300 will be powerful evidence that a new bull market is underway. The supporting indicators are positive. 

The gold price bottomed in December and is currently rising in this four-month-old channel.  The next rally is expected to begin once price breaks out at the tip of the green arrow at the $1240 level.  The supporting indicators are ready to turn back up. 

Silver is emerging from a bullish wedge formation.  Confirmation will come with a close above the blue arrow. 

Peter Degraaf
www.pdegraaf.com

 

 

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.
kitco news

Follow Kitco News

Precious Metal Charts