As the US Mint Numbers reveal, in the Wake of Trump Market Euphoriasales of gold and silver have plummeted in the West (especially USA), but surged in the East:


From SRSRocco:

With the Trump euphoria pushing the broader markets to new all-time highs, it has impacted precious metals demand considerably… especially in February.  Precious metals investors believing the White House “Grandiose plans”, of making American great again, have cut back seriously on their precious metals buying.

There seems to be a percentage of the alternative community that are convinced that Trump will actually put the U.S. back to the way it was in the 1960’s.  And that is, back to a manufacturing powerhouse with high-paying jobs.  While this would be a wonderful thing to do, the continued disintegration of the global oil industry, just won’t allow it to happen.

IT WAS A ONE-TIME DEAL, and that period has come and gone…. FOREVER

Regardless, Western demand for precious metals declined considerably in February versus the same month last year.  A few years ago I spent more time publishing articles on gold and silver demand, but have refocused my analysis on how energy will impact the precious metals, mining and the overall economy.

However, Louis at Smaulgld.com does an excellent job publishing articles on precious metals demand.  So, I have used some of his data and one of his charts.

As I stated above, the Trump market euphoria has taken the wind out of precious metals investor recently.  According to the data from Smaulgld.com and the U.S. Mint, sales of gold and silver have plummeted in the West (especially USA), but surged in the East:

As we can see, Shanghai Gold Exchange withdrawals surged 67% in February versus the same month last year, while Perth Mint silver sales declined 17%, Perth Mint Gold sales dropped 32%, U.S. Gold Eagles fell 67% and Silver Eagle sales plummeted 75%.

According to Louis’s article, Shanghai Gold Exchange February Withdrawals Highest On Record, he published the following chart:

Chinese Shanghai Gold Exchange withdrawals were 179 metric tons (mt) in February compared 107 the same month last year.  Gold withdrawals from the Shanghai Gold Exchange are a pretty good proxy for the physical metal demand taking place in China.  We must remember, global monthly gold mine supply is approximately 265 mt.  Which means, the Shanghai Gold Exchange withdrawals of 179 mt accounted for two-thirds of global gold monthly mine supply.  That’s a heck of a lot of demand… from just one country.

The decline in U.S. Gold Eagle and Perth Mint gold coin sales in February versus last year equaled 67,806 oz.  However, Shanghai Gold Exchange withdrawals increased 2,315,000 oz in February compared to the same month last year.  So, we can clearly see that the increase in just Chinese demand, via the Shanghai Gold Exchange withdrawals, more than made up for the decline in Western retail official cold coin purchases.

Unfortunately, the Royal Canadian Mint does not publish their Gold or Silver Maple Leaf sales until after the end of each quarter.  That being said, Canadian Gold and Silver Maple Leaf sales normally parallel what is taking place in U.S. Eagle sales.  Thus, Gold & Silver Maple Leaf sales are probably down signifcantly as well.

I would imagine most precious metals investors came across this article published on Zerohedge a few days ago, Demand For Physical Gold Is Collapsing.  It seems as if the intent of this article was to generate a lot of READS.  Because, if we look at what is taking place in China, there is no collapse in physical gold buying.  Matter-a-fact, there was a record amount of gold withdrawn off the Shanghai Gold Exchange last month.

The author of that article, needed to include a footnote stating the following:

Western physical precious metal demand (especially in the USA) decreased significantly due to the Trump Market Euphoria, while Shanghai Gold Exchange withdrawals hit a new record in February as the Chinese realize the U.S. economy and Dollar is still toast.

I am completely dumbfounded by recent decline in precious metals demand and sentiment in the West.  While I can understand the reason precious metals investors believe Trump will make America great again, the awful ENERGY DYNAMICS in the future will not allow us to return to the good ‘ole days of a manufacturing super-power.  Rather, the upcoming collapse will change our lives forever.

When the Dow Jones Index and broader markets finally crack, there won’t be many SAFE HAVENS to invest in.  Along with a collapse of the Dow Jones Index, Real Estate prices in all sectors will also head down the toilet.  Investors scrambling for something to protect wealth will finally move into precious metals.  Unfortunately, there won’t be the available supply… only at MUCH HIGHER PRICES.

So, this current downturn in Western physical gold and silver purchases do not faze me one bit.  It only indicates that most Americans are completely insane when it comes to sound fundamental investing.

IMPORTANT NOTE:  I will be publishing an article on the continued disintegration of the Global Oil Industry.  I provide data showing how Mexico’s national oil company, PEMEX, is literally BANKRUPT.  By looking at the data, logic suggests that the global oil industry is in serious trouble.

Lastly, the data for the Perth Mint sales came from two articles at Smaulgld.com, Perth Mine Silver Sales Slump In February and Perth Mint Gold Sales February Drop 32%.  Sales of Gold & Silver Eagles were found on the U.S. Mint website.

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  1. Well loti freakin’ da.

    I’ll tell you why ASE sales are down, because silver costs $17.46. When you subtract the premium for an ASE $2.50 from the minimum premium $.49 even if you don’t have any good local coin dealers who will sell you junk at spot, that is $2.00 worth of unnecessary premium per ASE. That means you can literally have 8 oz of ASE or 9 oz of generic silver. Where do you think the smart money is going?

    If you honestly believe that silver is going to $100 an OZ, do you want to spend your money on over spot premium, or do you want to spend your money on silver? The only reason the U.S. even has a bullion industry is because Americans are swimming in so much borrowed money, that the tiny percentage of people who are awake enough to stack has a sizeable chunk of change. It is foolish to take the very last place this small group of stackers would go as a measure of anything. That’s like gauging world sentiment on coffee from a dip in sales for Starbucks in Moscow.

    • Natty…There’s a huge psychological component in my opinion. People buy bullion when the price is rising and buying goes absolutely crazy when the price is surging day after day. Think 2008 and the wait times for delivery. Same phenomenon is seen with lottery ticket sales and slot machines. When the jackpot reaches astronomical levels record numbers of people play.

    • Ugs,

      it isn’t only like that with PMs, it’s like that with everything. Increasing value makes people want to get in.  Falling value makes them want to get out. That’s why most folks lose money if they follow their gut feeling.  Stocks, bonds, and especially real estate. The big problem with PMs is that most people in them see them as an investment like those other thing, not as money. At this point, I just want my wealth out of the hands of bankers.

  2. Over on KWN there’s a new James Turk article in which he touts “the massive 47yr cup-and-handle” silver chart. Now I like Turk, but that has to be about the dumbest thing I’ve heard related to technical analysis. Seriously, does anyone think the same players are in the market 47yrs later. I can understand the reasoning of a short term cup-and-handle signaling a nice move up, but by extension transferring that reasoning to a 47yr chart is nonsensical in my view. Just watch now, silver will soar. Turk will be vindicated. And he will rightfully call me an idiot in one of his articles. That’s OK, though, because I’ll be too busy celebrating.

  3. I didn’t used to wait for smack downs to buy.  I just bought in every payday.  Do others evolve in their thinking like that? A next possible step after that would be to buy generic rounds instead of the more expensive issues from the goober mint. Maybe just maybe some of us haven’t been able to dump a lot of fiat into metal like they used to.  I can’t stack as high as I did  in the 90’s. I was buying like a crazy person back then.  Then there’s the Asian demand which like guy says makes our conversation a moot point. The live charts are the same as it ever was. Stacking till the cows come home.

  4. I’m old enough to worry that AG and AU with do a triple double  I’m young enough to still believe in the tooth fairy but I am not sure if I’ll be able to enjoy those vast riches when PMs go to ‘da moon’

    Hell, I’d like to see a $65-80 price smack on gold and $1.25 on silver too.  That’ll get me back into the purchase market ASAP

  5. Stacking the shiny silver phyzz today, 90% Franklin halves face x 14 and 1/2 and 1 oz ASE and Maple leaf and Philharmonic on the dips. The stackers in the Western Hemisphere are doing their part with the shiny. The Eastern countries like China, India, Russia are stacking like there is no tomorrow in the pm market. I love the shiny, it can be like a kid in a candy store every time I buy the shiny. Dream the impossible dream…

  6. For some of us, and perhaps a lot more of us than some think, our demand for silver is tapering down because 1) we already have a substantial stack; and 2) the current price simply is not that attractive.  To attract more buyers, silver needs a $15 handle again and gold probably somewhere around $1050 would do it.  I don’t buy into the $700 gold price that some, such as Harry Dent, continue to talk about.  But a pull-back from the current level to $1100 or a little less seems quite possible.

     

  7. This is easily explained. Only a very tiny percentage of the western population is awake and they have been stacking the physical bullion for quite some time and most have a comfortable position, they are now playing the waiting game just adding a few ounces here and there. There is a limit for how much one can stack and store safely on one’s own property especially silver.

    • Yes agree  most of us have been stacking  each month for years  plus buying on the dips and the Olde bank accounts are also being stretched ,just keep stacking

      the $ cost average strategy really works

       

    • That’s about right. Western central banks aren’t buying gold so the buyers in the west have been mostly individuals, and most of those have already acquired what they consider to be a decent position. Amongst that crowd are people that believe Trump has saved the day and are relinquishing some of their PMs to pursue other things with fiat. Two of my neighbors feel that way..

  8. I believe it is a two-prong attack on demand

    1) Why spend more to buy highly generic, non-collectible BU ASEs? For the premium values, you can buy almost any other coin that will keep or exceed its premium in a few years’ time.

    2) Western stackers are usually the gold bugs and savviest. With prices below 17$ for the better part of a year in 2014 & 2015, most probably hit their stacking targets.

    I had a target, I reached it, and now simply buy new Libertades for collection and blow-out deals when the price goes below 17$ and 1200.

    • The ASE’s have a tax-free value, whereas every other coin does not. (federally- not speaking of Idaho and Arizona recently)

      Gold Eagles are tax exempt as well. (no reporting neccessary) Canadian maples are exempt from tax reporting up to 10,000/ year in sales.

      So if your stack is sizeable, and you liquidate 1/2 of it at a nice move, then buy again during a huge attack/smackdown, then you can realize profits without taxes.

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