Physical silver bullion sales exploded at SDBullion Wednesday, hours before the London Fix price setting mechanism was set to end on August 14th.
The London fix, which has been in place for 117 years dating back to 1897, announced in April that the daily silver fix would end on August 14th, when Deutsche Bank, under investigation by Germany’s BaFin for market manipulation vacated its seat and was unable to find a buyer.
SDBullion trader Jennifer Linhart stated that physical silver sales were five times normal volume Wednesday, as investors scooped up bullion ahead of any market disruption the end of the fix might cause:
“The phones were ringing off the hook all day, and silver sales were about 5 times normal for the day. We didn’t see much of any change in gold, everyone was buying silver.”
While SDMetals & Markets experts The Doc & Eric Dubin have maintained since April that the silver market would likely see little disruption with the Silver fix with an electronic replacement likely emerging, concerns have surfaced this week, as Mining.com reported that “With only three trading days left until the new electronic, auction-based and auditable substitute for the 117-year old silver fix goes live there is still no certainty over who will take part on Friday.”
Silver industry experts, such as forma GATA member Bix Weir have suggested that the lack of certainty over who will participate in the new CME/Thomson Reuters electronic fix come Friday could result in a chaotic “Force Majeure“ claim from bullion banks and speculators short silver futures contracts.
With investors frantically loading up on silver coins and bars at SDBullion Wednesday, it appears that PM bugs aren’t waiting around to see what happens.