Welcome to Money Metals Exchange's weekly market wrap podcast. Helping precious metals investors during these treacherous times. Now, here's this week's market wrap with commentary and analysis from the fastest growing precious metals dealer in America, Money Metals Exchange.
Welcome to this week's Market Wrap Podcast, I'm Mike Gleason.
Well, after suffering a technical breakdown last week, silver prices followed through on the downside this week - and so did the entire precious metals complex. Silver showed a weekly decline of nearly 3% through Thursday. As of this Friday morning, silver is recovering somewhat, with prices coming in at $19.89 per ounce.
The silver lining - quite literally - to the pullback of the past few days is that silver prices continue to be buoyed by a very strong base of support dating back to last June. The bigger the base, the bigger the move that can be expected once prices break out. Silver clearly has a lot more work to do before we can talk breakout again. But as long as prices can hold above the lower bounds of the range of consolidation we've been in over the past 9 months, the longer-term picture remains constructive.
Turning to gold, prices got hit again this week but are still well into positive territory for the year.The yellow metal currently trades at $1,296 an ounce, down 3% on the week. On the year, though, gold prices are up a healthy 7%.
As we've noted previously, precious metals will need to find another catalyst besides geopolitical fears in order to sustain a major rally. Fears of wider military conflict with Russia outside of Ukraine have dampened somewhat. That, coupled with Federal Reserve chair Janet Yellen's suggestions last week that the Fed will unwind its monetary accommodation, has given traders an excuse to sell precious metals futures.
In the end, what will drive precious metals markets is actual physical supply and demand fundamentals. And we'll have much more to say about why the fundamentals continue to be lined up in favor of higher metals prices in future broadcasts.
In the remainder of this podcast, I'd like to offer a bit of a practical edge and discuss the ways in which you can actually use gold and silver bullion in various sizes and shapes - from the familiar 1-ounce coin all the way down to a single-gram bar.
If you own 1-ounce bullion coins but don't yet own a variety of fractional sizes, it may be time to consider diversifying. Adding fractional sizes of bullion will make your metals stash more versatile and more adaptable to changing life circumstances and volatile social and economic conditions.
Now, for the portion of your precious metals stash that you intend to keep locked away for long-term wealth preservation, we continue to recommend low-premium gold bullion bars and 1-ounce rounds and 10-ounce bars in silver. They are the most practical and cost-effective ways of investing in physical gold and silver.
But what about the bullion that you want to actually be able to use in emergencies, for barter and trade, or for gift giving?
In these and other situations, smaller-sized units of metal may be more practical. And they are becoming quite popular as the economy shows signs of unraveling.
Even though small gold and silver coins have been getting serious traction with the public recently, the notion of fractional coins actually goes back centuries to the time when the Spanish real (or coin of the realm) would literally be cut into "pieces of eight" to enable smaller transactions.
Full-ounce gold coins are great for storing significant amounts of wealth and potentially for purchasing big-ticket items, but they're not so useful for smaller transactions. That's where smaller gold coins/rounds come in handy.
They have a number of other uses as well. For example, it's much easier for folks on a limited budget to accumulate gold if they don't have to spring for a full ounce at a time. That's why 1/10 oz gold is a key part of Money Metals Exchange's monthly savings plan, an industry leading program with more than 3,000 participants.
Meanwhile, many seasoned travelers carry 1/10 oz gold coins with them separately from their wallet for security wherever they go. Gold is universally recognized and traded around the world, and tenth-ouncers are easy to conceal within a garment or even a shoe.
Owning tenth-ouncers makes it easier to give the gift of gold to more people. There's nothing like pure gold to mark a special occasion for special people in your life.
As gold prices rise, fractional-sized gold bullion products will become more widely sought after by the public. A full ounce will simply become too expensive for a growing number of buyers who want to own gold. Last spring, the dysfunctional U.S. Mint temporarily suspended sales of 1/10 oz Gold Eagles after being overwhelmed by demand. If it happens again, premiums on small-denomination gold bullion products could surge due to scarcity.And even though you do pay a little more on a per ounce basis for the smaller sized products, due the higher per ounce minting costs, you do recover a good portion of that extra amount when you go to sell because they carry a premium over the spot price on the sell side as well.
Right now our lowest-premium tenth-ounce gold product is our exclusive .9999 pure (or 24 karat) Lady Liberty round at a price as low as $141 each based on the current gold price. We also carry fractional-sized American Eagles, Australian Kangaroos, and Gold Maples. You can even buy gold one gram bars, which are only about $50 each right now!
So, yes, a tiny gram of gold still commands a significantly higher price than a full ounce of silver.For that reason, it just may not be practical to try to use gold for small transactions. For most everyday barter and trade, silver is the best form of hard money to have around. In addition to the familiar one-ounce bullion coins, a well-diversified silver barter kit contains 1/2 oz and 1/10 oz rounds along with pre-1965 90% silver dimes, quarters and half dollars (so-called "junk" silver).
Although junk silver coins for sale are widely recognized among people who deal in silver or accept it as payment, old silver "change" may be under-appreciated by people who aren't involved in hard money. That's where freshly minted pure silver bullion fractional rounds may be useful - especially when you want to send a message of special appreciation in the form of a tip or reward.Once anyone experiences the feel of a shiny pure silver coin of any size in their hands, they instantly get that it represents real value. Heck, you may ever start a movement.
For more information on the many types of fractional gold and silver bullion products we sell - including our newly released 1/10 ounce Walking Liberty silver rounds - just visit our website, www.MoneyMetals.com or speak with one of our friendly and knowledgeable specialists by calling 1-800-800-1865.
Well that will do it for this week's Market Wrap Podcast, thanks for listening.This has been Mike Gleason with Money Metals Exchange reminding you that we remain fully committed to getting you the most value for depreciating dollar... with speed, with accuracy and with top notch service.Have a great weekend everybody.
Thank you for joining us for this edition of the Money Metals Exchange Weekly Market Wrap. Be sure to come back next week, and don't forget to subscribe to our weekly podcast through iTunes. For answers to all of your questions, or to discretely and securely buy or sell gold or silver coins, bars, and rounds, call 1-800-800-1865. Our knowledgeable and no-pressure specialists are standing by between 7:00 a.m. and 5:30 p.m. mountain time, Monday through Friday. Visit us at www.MoneyMetals.com or call 1-800-800-1865.
About the Author:
Mike Gleason is a Director with Money Metals Exchange, a precious metals dealer recently named "Best in the USA" by an independent global ratings group. Gleason is a hard money advocate and a strong proponent of personal liberty, limited government and the Austrian School of Economics. A graduate of the University of Florida, Gleason has extensive experience in management, sales and logistics as well as precious metals investing. He also puts his longtime broadcasting background to good use, hosting a weekly precious metals podcast since 2011, a program listened to by tens of thousands each week.