When it comes to buyers of physical assets as opposed to traders of paper representations of such assets, there is one key difference: the latter, more than anything, enjoy looking at “heatmaps”, chasing trends and jumping on momentum, the result being the most recent massive selloff in such “paper” representations of precious metals as the GLD and SLV ETFs, and various gold futures.
On the other hand, those who prefer to hold the metal in their hands, as well as others such as China whose ravenous apetite for gold over the past 4 years has been extensively covered here in the past, take every advantage of selloffs, and – inconceivably – demonstrate how Econ 101, namely supply and demand, really works, leading to ever greater demand the lower the price. Demand so high, in fact, that the underlying commodity that is being sold through paper conduits, sells out.
This is precisely what happened at the U. S. Mint, which just sold out of all silver American Eagle silver bullion coins, following “tremendous” demand in the past several weeks, according to Reuters reports.
This should hardly come as a surprise: over the weekend we reported that “Silver Coin Sales At US Mint Soar To Highest In Two Years.”
This post was published at Zero Hedge on 11/05/2014.