Archive for June, 2013

The Return of Unprecedented Demand

June 13th, 2013  |  Published in Coin Series

A rocky year for silver has only served to spur heavier demand for physical silver investment products. Chief among them is the perennial favorite American Silver Eagle bullion coins, which have been offered by the United States Mint each year since 1986. For the current year, sales indicate that a new annual sales record may be in the making.

Each coin is struck in 1 troy ounce of 99.9% fine silver and carries a nominal face value of one dollar. The weight, content, and purity of each coin is guaranteed by the US government, which makes them widely trusted and favored as a silver investment vehicle around the world. The obverse design features a stunning rendition of Liberty, which originally appeared on the circulating half dollars issued from 1916 to 1947. The reverse features a heraldic eagle which was designed by the former Chief Engraver John Mercanti.

The year for the iconic coins started with a bang. Opening day sales on January 17, notched a record high of 3,937,000 coins. The heavy orders continued, until the US Mint was forced to declare a temporary sell out. Sales would resume after a ten day break, under an allocation program which rationed supplies to the market.

Now at mid-year, sales are running more than 20% above the pace experienced in 2011, when the US Mint would sell an annual record of more than 40 million coins. Sales exceeding this amount would actually account for the entire annual domestic silver production.

In April, the market price of silver took a tumble, investors responded by order silver bullion products more heavily. It’s been said that experienced bullion buyers make their purchases when prices go down, and new buyers make their purchases when prices go up. Perhaps the only thing that can stop the unprecedented demand is stagnant prices. May silver investors live in interesting times.