The Other Precious Metals: Part II

I'd like to thank Loren Howe, guest author and founder of preciousmetalpurchase.com for providing this article for us.  Mr. Howe has been involved in precious metal investing for over a decade and here is providing us some information on those rare metals that are not "silver and gold."  Mr. Howe can be reached at info@preciousmetalpurchase.com.

The Other Precious Metals: Part II

Indium, germanium, and iridium are available for physical purchase or resale through www.preciousmetalpurchase.com.  Another option is holding industrial metals through offshore storage programs. The company www.swissmetalassets.com in Panama first developed this option. Through Swiss Metal Assets, much like an ETF, an investor can purchase and resell interest in several baskets of metals including indium, gallium, tellurium, tantalum, hafnium, bismuth, rhenium, molybdenum, chromium, and tungsten. A Canadian company www.smg-indium.com also operates as an ETF for indium.  Lastly, many industrial metals are often available for physical purchase or resale through EBay.

Rare industrial metals are used almost entirely for industry with little room to accommodate investment demand. Nearly all LCD screens, for example, use a dollar or so worth of indium. The price of indium could rise over 10 times before noticeably impacting the finished price of computers or flat screen televisions.

Germanium Bar

It is little wonder that the media grudgingly tells "precious metal" investors to put their money into mining stocks, ETFs, or as a last resort physical gold and silver. Investing in mines subsidizes metal production and drives down prices, while gold and silver investors bid in competition mostly against other sound money proponents. It is interesting to imagine what would happen if sound money proponents forced the market to either allow a non-inflationary currency, or suffer the true consequences of price inflation.

We can see partially, with silver, what happens when investors drive up the price of a rare semi-industrial metal which is not fully controlled by the Establishment. Despite sale from stockpiles, the price of silver increased by a factor of 10 in less than a decade. Now imagine what could happen with metals far more rare than silver, vital to industry, but with no current investor demand.

Indium Bar

In the interest of giving a balanced picture, it is necessary to discuss the downsides of rare industrial metals. A major problem, as discussed, is repression of the market in the Western Establishment. It becomes difficult to trade these metals when at every turn, you find a monopoly unwilling to deal with investors. Due to the general lack of an investor trading community, the spreads on rare metals tend to be greater - in the same way that the spread on palladium is greater than the gold spread due to a shallower trading pool. Secondly, although rare industrial metals are currently somewhat ignored by the media and regulators, it is likely that attacks will be stepped up if they begin to catch favor with investors.

he fight for sound currency has always been difficult, but the community of sound money proponents has been making large gains in education (and profit) over the last decade. Rare industrial metals are a new tool which was effectively hidden but is finally coming to light. It will be interesting to see if this proves to be an unnoticed Achilles’ heel of fiat currency.

The OTHER Precious Metals: Part I

I'd like to thank Loren Howe, guest author and founder of preciousmetalpurchase.com for providing this article for us.  Mr. Howe has been involved in precious metal investing for over a decade and here is providing us some information on those rare metals that are not "silver and gold."  Mr. Howe can be reached at info@preciousmetalpurchase.com.

The Other Precious Metals: Part I

When people think of investing in precious metals, what immediately comes to mind are gold and silver. A few will also remember platinum and palladium. However that's not the full story. There are quite a few rare metals which are largely ignored by the media and are therefore almost never considered by any investor. It's interesting to learn how we got to this point.

  Traditionally investors have only purchased 

well-known metals such as gold and silver

With the partial exception of silver, mining conglomerates and banking industry stockpiles exert strong control over the "precious metals" market. Consider that smart bankers know the main competitor to fiat currency is precious metal. What better way to neutralize the competition than to buy it out?

Yes, standard precious metals still provide an inflation hedge, but the Central Bankers can sell their stockpiles or short sell futures contracts when the market overheats in an attempt to suppress metal prices. Finally when each inflation cycle slows, the metal markets drop. The large banks, which are experienced in this process, can buy back their stockpiles on the cheap. If hyperinflation sets in, governments often confiscate precious metals - which somehow always seem to then find their way back into the hands of the Central Bankers.

 A rare palladium coin.  Most people will never touch a 

.999% pure form of this metal in their lifetime

 Precious metals are certainly still one of the best ways for small investors to protect their savings. That's especially apparent in recent years. However, the Banking Establishment responses described above do create significant difficulties for small investors.

This history was my starting point to research "other rare metals." The first fascinating thing you'll learn about other rare metals is that you are not allowed to buy them. Call up the very limited number of refining conglomerates which dominate the market. Ask, as an investor, to buy rhodium, iridium, indium, etc. It is simply not for sale to investors at any price in any quantity. Sure that's an apparent violation of anti-trust law, but regulations haven't been much of a hindrance in corporate America for decades.

Rhodium is very rare.  However, that $10 shiny necklace you 
have might coated in a microscopically thin layer of rhodium. 

A very few small businesses have tried to physically sell ultra rare metals to investors using metal purchased from independent sources such as recyclers. It appears that targeting by government regulators often discouraged these attempts and the businesses closed shop. As usual, in Great Britain the situation has gone even further, with regulations restricting the sale of rare industrial metals to investors under the guise of fighting terrorist financing.

Lastly, the Establishment attempts to control the conversation surrounding precious metals. We are told they are a bad choice, but if you are going to invest you only have four metals to choose from. The tiny minority of people who look past those four metals are then geared towards the rare metal rhodium. While rhodium certainly qualifies as a rare metal useful to investors, it is no more so than a dozen other unmentioned choices. The difference is that rhodium is largely monopolized by the same mining conglomerates which control the other platinum group metals. Thus, rhodium is available in a very limited number of investment options approved by the conglomerates which dominate production. There is a rhodium ETF (not available to Americans) run by Deutsche Bank and physical rhodium is available for purchase and resale through www.kitco.com. The remaining rare metals are ignored or occasionally ridiculed as investment vehicles in the Establishment media.

  A jar of iridium powder.  Very rare.  The metal is brittle and 

unable to be fabricated into .999% pure bar form

The most reliable way around Western monopolies is to purchase metals which are produced outside of the Western Establishment's control. Fortunately there are numerous rare and valuable metals which are not dominated by conglomerates and which give investors unique opportunities. For example, indium is about half the price of silver but 40 times more rare, while germanium costs 3% of the price of gold while being 20 times rarer. Iridium costs around half the price of gold while it is an astounding 500 times more rare than gold by mining production. The entire annual world production of iridium could fit in a small bathtub.

 

 Rare germanium in bar form available from preciousmetalpurchase.com

  

Check back next week for Part II of this article which will contain more information of how to invest in rare precious metals and where to buy them at a fair market price.

 

500 gram bar of indium

Cohen Mint Scam: Rhodium

Cohen Mint Scam: Rhodium

For years I've been a big fan of The Cohen Mint.  I bought from them, had a couple conversations over the phone with the founder of the mint, and even did an interview with him that you can find here.

Now, over these past few years I've seen dozens of negative comments regarding Mr. Cohen's business.  When I ordered my palladium coins or rhodium bars I realized that it might be a few months until they were delivered.  So, I assumed that the complainers were just impatient.  I think I assumed wrong!

I believe I placed my last order in January 2012.  I received my bars in May 2012.  Problem: bars were both cracked.  I contacted Cohen Mint several times and haven't gotten a reply.  I called on the phone and haven't gotten an answer.  Cohen Mint knows that I'm stuck with cracked bars.  Cohen Mint SHIPPED me cracked bars (no way did they crack during shipping because they were padded well). 

So, I'm just putting this out there that I've done a 180 with the Cohen Mint company.  I will do no further business with them.  I asked for a couple rhodium bars, not cracked rhodium bars.  I should have listened to everyone else

)

Buy Silver!?

I'm currently traveling Europe right now so any move I might like to make will be...not made.

The only move I see that I would be making, though, is possibly to sell gold. Or, that would have been the goal a week ago. I don't know if silver is going to continue to drop or not. I'm hoping it will, because if it does "buy silver" is a sure rule! However, now, again, it's hit or miss. If one were to sell gold and buy rhodium I would completely understand the logic!

I still have platinum that I haven't sold because I feel it's undervalued. I've feel that way for a while but the world hasn't so, as we speak, gold is higher than platinum. Hmm...

Advice? I have none I'm strongly giving except to wait. If anything, silver has fallen a higher percentage than gold, so, selling gold and buying silver would not be an unfounded decision. Personally, though, I see $22 as silver's price and gold at $1600, meaning silver could still drop more than gold (if I were the world emperor, which I'm not!).

Sooooo, in other words, I'm not doing anything with my metals/money at this point. If ANY of the five metals drops another 20% I say buy! If gold goes up 20% I say buy silver because it will follow.

Rhodium Price Drop Again

Rhodium Price Drop Again

We've been seeing quite a bit of activity in the rhodium price over the course of April. I can't tell you how timely this is for my investment strategy!

With all the other precious metals at or near their all time highs, rhodium is no where close. Granted, it may never go as high as $10,000 per ounce again, but still, I feel it's greatly under valued at the current $2200 per ounce.

What I feel will happen is that either rhodium will reach $5000 before this PGM run is over or else the other metals will come tumbling down without rhodium falling too much. I could be wrong, but my strategy is to buy rhodium. But why buy now when it keeps falling? The more it falls the more I can buy, also, the more room it has to climb!

How Metals Have Faired Over the Past 5 Years

Times have been turbulent for most of the metals. I've made personal charts with pen and paper to figure out the percentage gains of each metal versus the other metals, etc. I did this because a) I don't have a chart-making program on my computer and b) the online ones don't give me what I want to know. Let's take a quick look at some of the things that have been happening.

Gold Is Rising

To start with, gold has proven to be a great investment over the past 5 years (it's been good for longer than 5 years but I use PGMs as a medium-term investment vehicle). As you can see, if you would have sold in early 2008 for cash and rebought it late that same year, you would have increased your holdings by about 25%. From that low point of under $800 in 2008 until today, gold has nearly doubled.

Gold is too slow, steady, and boring for me. It will continue to keep up with inflation If you want to buy gold I'd wait, as it's now at its all time highest price.

Silver Rose A Lot, May Rise More, But Will Definitely Fall

Silver, like gold, has proven to be a good investment. If you did the same as gold--sell in spring 2008 and buy back in the fall--you would have increased your holdings by 100%. And, due to luck, perhaps, if you ended up buying in late 2008 and holding until today, you would have increased your holdings by 400%.

I always try to give a little advice when I can. Although no one knows what will happen, this is what I predict: silver might hit $50, but I think its run is coming to an end. Conclusion: sell your silver now!

Platinum Did Better a Few Years Ago

I don't mind bragging a bit saying that I sold some Platinum when it was at its peak back in 2008. I will however, admit that I wish I had bought it back at the end 2008. I would have realized over 100% gains!

Unlike gold and silver, though, today, platinum is still 20% below its 2008 high. I feel something has got to happen here. Gold can't remain at $1500 if platinum is only $1800. Will gold fall? Will platinum jump to $2400? Look where silver is, with it's 400% gain. It's odd silver is on such a run and platinum has held steady. It will be one of the scenarios I mentioned, but I don't know which. If I had to buy or sell I'd flip a coin because it's not high enough to realize gains or low enough to know that it'll go higher anytime soon.

Our Good Friend Palladium Shines!

I haven't been posting much but I have been sitting around watching the palladium I bought when it was $200 an ounce climb 400% to over $800! Again, yes, I'll brag, but c'mon, it was obvious palladium wasn't going to stay at $200 an ounce for long. Palladium fell further than the other metals, and kept falling after they stopped. It's risen as much as silver has, but silver did it all at once, Palladium took two years.

The advice regarding palladium I've given has always been sound. You would have always made money if you bought or sold based on my suggestions (and I'd like to keep the record going that's why I don't post too many suggestions anymore). Prediction: palladium will fall considerably, probably in 2011. If you sell palladium now, I'm guessing you'll be able to buy it cheaper within the next 6 months. I'm hoping it hits $900 or so, though, before I do sell.

Rhodium, Rhodium, Where Art Thou?

Rhodium, like platinum, had a huge 120% jump from 2006 to 2008. That was when you couldn't buy rhodium anywhere. I have my Cohen Bullion now and have investing in some pools (like stocks), but I wish we had these things back in the olden days of 2008! $10,000 an ounce wasn't significant when dealing in percentages. Looking at the chart it looks huge but now that I have my own charts I realize a few things:

• If you bought rhodium in 2006 and sold in mid-2008 you would have doubled your money
• Rhodium was the best investment from 2006 to 2008, followed very closely by platinum
• Rhodium would have by far been the worst investment today if you had bought in early/mid-2008.
  
• Over the past 5 years (if you bought in 2006 and are still holding) rhodium would have proven to be the worst investment. Silver would have been the winner, gold second, palladium third, then platinum and rhodium
  

So, that's what's happened over the past 5 years. As always, any metal would have made you a fortune if you either got lucky or timed the market correctly. What does that mean? I think it means that the worst performer, rhodium, might be looking for it's time to shine! I would never buy palladium or silver right now. I would buy gold but not at $1500, maybe after it drops I would. And I'm unsure of what platinum will do. Rhodium. I will buy rhodium. In fact, as you can see by reading my posts, I already have!

Behold! 1 oz Rhodium Bullion in my Hands!

My first attempts to own rhodium failed. First I attempted to purchase it; yet it existed no where for the layman slash everyday investor to buy. My search took me to the dark, undercover areas of Tokyo, Japan. I was given a tip in Osaka that rhodium was available in small vials in "sponge" (powder) form, but I came home empty-handed. Imagine the horror. During this 2008-09 search rhodium was at just $750 an ounce.

Next I attempted to buy bulk, looking for 4 other investors to go in with me and we each pay 20% and each get one 2 oz bar. I only found 2 other people. Finally, my search led me to Eitan Cohen, owner of the Cohen Mint. We spoke on the phone and I learned he had rhodium coins on the way! But, not only were they only one gram, I received several emails from buyers who had to wait months to have their orders filled (no, I'm not affiliated with Cohen Mint, but I assure you a) it's damn hard to make a rhodium coin and b) they WILL get it to if you're patient). Either way, I decidedI'd buy my 1 gram coins from an Australian reader of this blog. I didn't know him, but I trusted him enough to buy a few coins. The product was good, so I bought the rest of what he had.

Cohen Mint 1-Gram Rhodium Round

But I was still several grams away from one ounce! So, when finally Cohen announced the 1 ounce rhodium bullion bar I contacted the company and made arrangements to purchase one. You need a cashier's check sent overnight (to make sure there's no huge price fluctuation) or else a bank transfer. I chose the former and FedEx (man, I hate FedEx!) didn't inform me that the don't ship to P.O. Boxes. So, I didn't get my cashier's check back until the next week because FedEx sucks. Then I had to pay to ship it with the Post Office. It was a pain getting my $30 back from FedEx too! Next time I do bank transfer!

1 oz Rhodium Bullion

Email communication with Cohen Mint was good. Many readers of this site expect hourly replies. Sometimes that just isn't possible and I understand that, so I don't mind waiting a few days for a reply. After 2 months, my 1 oz Rhodium bar showed up at the local post office! I picked it up on my way to work and left it in my glove box where I thought it would be safest. Never had a break-in but the rhodium bar is worth nearly as much as the car!

Cohen 1 oz Rhodium Bullion

The coin is well-formed and smooth. There are intricate details on the coin that I wasn't expecting. I would have been happy with a slab of it stamped "Rh .999 pure" and a "Cohen Mint" somewhere on it. That's how Engelhard did their silver; and it was fine for most of us. Needless to say, it's a beautiful piece of rhodium. The bar is smaller than 1 oz of gold, which makes sense considering rhodium's density is 12.41 g·cm⁻³ and gold is 19.3 (UPDATE: I was told I'm wrong on my physics here, but I'll just keep it that way for now!) Here is the size of the one ounce rhodium bar vs. the 1 gram rhodium coin. Notice the paler color of pure rhodium vs the nickel and quarter.


When I made this purchase Cohen Mint was kind enough to inform me that they could not sell me a coin because they hadn't designed any yet, but that they had some in the works. I feel this is really respectable because if I had wanted a coin I could have waited for one (or four, actually, so that I'd have an ounce). Truthfully I kind of like the bar, but here's a preview of what the Cohen Mint has up its sleeve!

Yes, that's a man on a horse stabbing a dragon. Let's hope they can make it this awesome!

Palladium Soars! Sell Now?

As I sit here, personally not making many precious metals moves other than purchasing some rhodium, I'm quite happy with my 2008 purchase of Palladium Canadian Maple Leaf coins. The price was $200 then; $600 now. This blog includes a lot of my opinion which I guess you could say is "investment advice" (though I don't view it as advice in the sense of advice of journalists who have never owned precious metals in their lives. Plus I blankly state when something is my opinion).

However, my idea of buying palladium in 2008 and selling when it reaches a high point, if implemented by selling today, would net the seller 200% profit. If you paid $250 for a coin in 2008 you could likely sell that coin for over $600 today. You make $350--nearly 200%. Multiply your earnings by the number of coins you bought and sold.

I'm really happy to see palladium soaring. Silver, platinum, and rhodium are all up, but palladium is three times up from its 2008 price. (Well, I guess rhodium is too, but rhodium wasn't available for purchase in 2008, so it doesn't count.)

I'm not envisioning palladium to jump much higher, though. I think silver breaking $21-22 will be needed to see palladium break $650-700. So if you're looking to make some money, sell your Pd now if you paid under $300 for it. Or, as I've been saying, sell ANY other precious metal and purchase silver. It's $18 per ounce, but a case could made that it should be at $50 per ounce or more. If I get some bucks I'll buy more for myself, perhaps even sell some palladium or gold to do so!

On gold, I don't see it moving anywhere but in the $1100-1200 range in the next few months, thus no more than 10%. Sell to buy silver? Not a bad idea! Would have been a better idea a few months ago!

Group Buy: 2 oz Rhodium Bullion Bars

Many of us have been wanting to buy physical rhodium for some time now. The Cohen Mint gave us rhodium, but there are some problems: they're only 1 gram (31 grams = 1 oz), inconvenient if you're looking to own a couple ounces, and very expensive because there isn't much of a discount if you buy 31 of them. I have respect for the Cohen Mint for marketing these coins and I even own a few grams myself, but I'm looking to own a single, heavier piece of rhodium!

Rhodium 1-Gram (0.032 oz) Coin

So I've been in contact with and have received two phone calls from American Elements - "World's leading manufacturer of engineered and advanced material products" (www.americanelements.com). I wanted to buy about 1-2 ounces of rhodium for myself, but even with AE I discovered that there'd be a few problems:

1. The fabrication costs to create the bars is much more than I was expecting
2. They only make 2 oz bars because the fabrication charges of 1 oz bars would be even more
3. There's a minimum order of 10 ounces (5 bars)

With the fabrication charges and "metal production charges" each 2 oz bar would cost $8073 plus shipping. And remember you have to buy 5 of them, so that's $40,365. I certainly don't have nearly that much, but I think I could swing the $8073. That's about $4000 per ounce, or 33% over spot, which for something this rare is, well, I don't want to say it's reasonable, but I don't really have any other choice.

Rhodium 2-Ounce Bullion Bar

So, I'm looking to do a group buy (or "purchase syndicate" if you want to be technical) with a few different people. Ideally I would need 4 other guys (or gals), each of us paying $8100 each (I'm rounding up and estimating to cover shipping costs). When we pay, the price will be locked in regardless if the rhodium spot price fluctuates. Or, if a certain member would like two bars he would pay double and we'd only need 4 people.

Before doing this I'd recommend we exchange phone numbers and any other information so we feel secure with each other. If we don't trust each other I'd rather choose another person to be member number five. My goal here is to own 2 ounces of rhodium. If that is your goal too and you don't have the $40,000 we'd be helping each other obtain that. Ideally, I'd receive the payments by bank check or bank transfer into my bank account. You could verify that the name and address on my bank account matches that of my driver's license which I could copy for you. If one member doesn't pay and we don't want to wait to find another, then I would return all the money to everyone.

When the $40,000 is in my account I will pay AE by bank transfer. They don't have these bars sitting around so it will take about a month for them to fabricate and send the bars. When I get the bars, I would send them directly to you by certified mail where you have to be present to receive the delivery. I don't want there to be any delivery problems so I'd like to pay extra for the most reliable shipping and have them delivered at a time when you can receive the package at your home or office.

This is a lot of money, so like I said I would even prefer it that we spoke on the phone enough that we trust each other. I'm definitely not the type to scam anyone but if you're anxious or have a problem with waiting the month for fabrication/delivery I think you'd agree that we shouldn't do this together. I'm not going to quote how cool rhodium is here or why you should buy it. I'm looking for four guys who already want to own rhodium and will be serious about having 2 ounces in their hand by May 1, 2010.

If you're with me, say "I!" My email address is under "AUTHORS & COMMENTS WANTED" in the right sidebar. If you've emailed me and not received a reply in a day or so leave me a comment by clicking on "COMMENTS" below this post.

You'll be getting one of these guys. I don't know about you but I'm keeping mine in the case!

Palladium Rhodium 2010

Readers and fellow investors,

I know several of you read the site regularly and haven't seen an update in months. I apologize.

However, in the coming few weeks I have plans for more articles regarding gold investing, silver investments, palladium bullion, and Cohen Mint rhodium coins.

Recently I've acquired some rhodium of my own. I've acquired more silver. I've switched jobs, made plans to move, and plan to trade and sell some of my investment metals, but ultimately, my stash should increase, because, as I've been saying, now is the time to buy.

I've read a lot more investment material and feel I'm even more able to predict future events regarding the economy. I don't have my own crystal ball, rather, I read the writings of those who have them. ;)

RE: the Cohen Mint

Also, I've been getting several emails and site comments regarding the late shipment of products ordered from the Cohen Mint. To those of you who've asked, I simply told you that I don't know. I personally have my hands on products created by Eitan Cohen, so, although I know many of you may not have received your shipments or haven't been responded to, I do assure you that the coins ARE being made, though I have no estimate of how long it takes to receive an order, fabricate Cohen rhodium coins, package them in their holders, and ship them throughout the world.

Do they take a long time to make? I'm sure they do. Is Mr. Cohen very busy? I'm sure he is. However, I've had no contact with Mr. Cohen since our Spring 2009 interview regarding the introduction of the Cohen Mint rhodium coins.

I apologize for any delays you may be having and I hope for everyone's sake we all receive our coins at the price we paid, even if delivery time takes longer than we'd expected. If you cannot wait, I'll sell you some of my coins as I have more on the way and am confident of their arrival. I won't cut you a deal on the price though as I'm also collecting them!


Thanks for your continued support. I'll be posting more soon!

Jim Rogers Thinks Silver Bullish

Jim Rogers says that although he doesn't think he's a gold bug, gold has been in a bull market since it hit its low in 2001. He says that he is currently holding gold and has been holding it for a long time. When told by the reporter that when adjusted for inflation silver peaked at over $800 per ounce before Columbus discovered the New World and around $100 per ounce in the early 1980s Rogers comments that not just silver but all commodities will be in a bubble before long:

"Silver is more attractive than many commodities. Silver is 70% below its all time high. There are not many things in the world you can say that about and if I had to buy any precious metal at the moment, I'd probably buy silver rather than gold. Gold's been making all time highs, silver's far, far below its all time high. Likewise palladium. Palladium is another that's far below its high. But I think think silver is more attractive than gold."

View Our Inflation-Adjusted Charts Article Here

Rogers then goes on to explain that silver has been used as money much more throughout history than gold has. He also notes that commodities will be hot for the next 10 or more years, and then stocks will be back.

The above is a complete summary. To hear the full conversation see the Youtube video below



Part 2 has Rogers commenting on governments printing too much money, gold being nowhere near its inflation-adjusted high, eventual currency collapses, US defaulting on its debts, and other economic issues. Interestingly, Rogers says his daughters will be given gold and silver for Christmas in 2009!

Watch Part 2 below




View Our Inflation-Adjusted Charts Article Here

1 Ounce Rhodium Bar Coming Soon!! (1 oz rhodium bar)

1 Ounce Rhodium Bar Coming Soon!! (1 oz rhodium bar)

MARCH 16, 2010 UPDATE: Sorry guys, I lied. These 1 ounce bars are not available and have for nearly a year said "coming soon." I'm sorry to disappoint everyone with the following article.

----------(original article follows)------------

That's right, folks, our friends over at Cohen Mint are planning to release a 1 oz rhodium bar within the next month!

Cohen Mint is by far the front runner in the rhodium coin market. In fact, the company has no rivals. If you're looking to invest in rhodium you either invest in stocks of a nickel mining company that has palladium, platinum, and rhodium as by-products, or you invest in a company like Stillwater Palladium Mining or Impala Platinum which also pulls some rhodium out of the ground, but neither of which focuses on rhodium (note: I haven't researched how to invest in stock of companies that mine rhodium, so understand that there may be more ways than I mention).

But, in the spring of 2009 Cohen Mint started producing one gram rhodium coins! Now, we're going to get a quarter of 1 ounce rhodium coins and 1 ounce rhodium bars! Here are a few photos of the current 1 gram rhodium bullion coins.

Front of 1-Gram Rhodium Bullion Coin

Rear of One Gram Rhodium Coin

To read all about the 1 gram rhodium coins which
have been available most of 2009, click here.

One Ounce Rhodium Bullion Bar

The proposed 1 ounce .999 rhodium bar looks like it will be pretty nice looking! I like the design and love that it will be double stamped. What I mean by this is that the sheet of rhodium will be stamped on the front, after which it will be stamped on the back. Some bullion bars are only stamped on one side and while they are worth the same (the weight of the metal, the back sides aren't shiny).

The new Cohen Mint 1 Ounce Rhodium bar will have a small stamp showing Eitan Cohen's design of a night on the horse. This is a good choice because it's the same design that's on the front of the one gram rhodium coins. As you can see in the photo the proposed stamp will also state the chemical symbol of rhodium, RH, "Cohen Mint," "1 OUNCE TROY," and "RHODIUM .999 FINE."

1 Ounce Rhodium Bullion Bar

The rear of the coins take some styling from other bullion products, such as the Engelhard Silver Bars (see left). Engelhard has versions where the rear if the bullion bar has "ENGELHARD" imprinted into the bar. The angle of the writing is quite stylish. However, as you can see in the photo to the left, the bar has the rest of the bar stamped so that "ENGELHARD" is raised above the surface of the bar, similar to the date printed on the coins in your pocket. While this is more attractive, due to the intricate detail of the design, I'm expecting the marks will be recessed into the bar. But the Cohen Mint has surprised us in the past, so we'll see!

Quarter of 1 Ounce Rhodium Coin (1/4 oz Rhodium Coin)

When you hear the Cohen Mint is going to make a 1 ounce rhodium bullion bar, you're excited. But when you go the site, there's a surprise waiting for you: the Cohen Mint will also make a 1/4 ounce rhodium coin!

The 1/4 ounce rhodium bullion coin will look similar to the 1 gram rhodium bullion coin pictured above, however, since the coin is about seven times the weight it will have approximately twice the surface area of the 1 gram coins. To put this into perspective, if the one gram rhodium coin is a dime, the 1/4 ounce will be a quarter (no, that isn't the exact size, but similar).

And below you can see the proposed design. Very nice looking coins. We're hoping these will have less of a premium for fabrication costs because, it takes approximately as much work to make a 1 gram coin as it takes to make a quarter ounce rhodium coin or a 1 troy ounce rhodium bar.

Quarter Ounce Rhodium Coin (1/4 oz Rhodium Coin)

1 oz Rhodium Bar Pricing

I haven't contacted Eitan Cohen about pricing. He is, as you can guess, a very busy man! When the 1 gram rhodium bullion coins came out they were priced at $90 when rhodium was around $1500. Now that rhodium is around $2300, the coins are selling for $125.

For my prediction, I'm guessing the 1 ounce bars will be around $2900 with rhodium at the price its at today. I would say the 1/4 coins will be around $800. Now don't quote me or plan on these prices. These are my guesses and I wouldn't be shocked if I were off by as much as 20%.

UPDATE: the 1/4 ounce rhodium coins are selling for around $880 and the 1 ounce bars are $3300.

Article Summary: 'New Normal" for the Gold Price?

Over the past week or two I've been helping an exchange grad student at the local university summarize articles for his Literature Review class. Doing so, I realized that it's entirely possible to get a seven page article down to a few paragraphs. Therefore, for several reasons--to save you time of finding articles, to save you time reading articles, and to save you from reading my opinions only--I've decided to start summarizing a few others' articles to give you a different angle on things.

Peter Cooper, writing for Arabian Money, posted an article on November 4 commenting on the surging gold price. The article give his predictions, views, and even a bit of investment advice.

Cooper (2009) states that with gold standing at $1080 at the time of writing, another jump in the gold price seems almost certain. However, saying now that gold will jump to $2000 might be similar to the Kremlin declaring in July 2008, when oil was $147 per barrel, that oil would jump to the $200-250 range. Gold, though, is not just on a temporary spike as oil was. For this to be a spike we'd need to see $1500 gold, or higher.

Cooper (2009) notes how that at the time of writing the dollar was somewhat of a safe haven, along with gold. Also, "increasingly it looks as though silver is also being treated as precious metal again rather than an industrial commodity, offering an interesting leverage play on the rising gold price" (Cooper, 2009).

It still seems that gold won't be going much higher as long as we have a strong dollar, Cooper says. Cooper also mentions the possibility of a global currency and the uncertainty of the dollar's future. However, in times of uncertainty, gold and silver will retain their value.

Finally, Cooper notes that holding gold is more a wise investment than holding dollars. He also notes the fact that the India is purchasing a lot of gold from the IMF.

Cooper, Peter (2009). What is the 'New Normal' for the Gold Price? Arabian Money. http://news.goldseek.com/PeterCooper/1257344245.php.

Article Summary: $1160 is Gold's Next Target

For several reasons--to save you time of finding articles, to save time reading articles, and to save you from reading my opinions only--I've decided to start summarizing a few others' articles to give you a different angle on things. I will do this from time to time.

Daryl Guppy (5 Nov 2009) claims that the sudden rise in the gold price has been influence by the Indian Central Bank buying gold from the International Monetary Fund. He notes that many gold bugs seem to think gold will hit $2000. However, the four factors that influence the price of gold may not actually influence the price as much as gold bugs think it will.

1. Fear. Gold reached $1000 in March 2008 when the market was collapsing and then reached it again in September 2009 after the global market had recovered. This proves that fear is not as huge a factor as it may seem.

2. US Dollar Strength. The dollar began falling in March 2009, however gold also fell from $1000 to $850 at the same time; and then it rose back over $1000. Not much of a correlation.

3. Central Banks. The Indian buying pushed gold to its current all time high. However, transfering the gold from the IMF to central banks doesn't affect supply and demand, therefor any affect on the gold price will be short-lived.

4. Jewelry. Indians only buy gold around holidays. Also, jewelry demand is only steadily increasing worldwide, as it always has. This increase is not enough to affect gold's sudden jumps and retreats.

Guppy (2009) next states that gold has reached it's first plateau of $1080. Next it will be $1160, and then $1240. However, he also says that if China announces that they won't start buying from the IMF, gold could retreat to $1000; but if they announce they will start buying, gold could hit $1160.

Guppy states that the way money is made in the gold market deals with "suppliers of pick sand shovels, or steel for the mine pit heads and food for the miners that go on to build solid and sustainable businesses" and that profits would be in mining companies.

Guppy, Daryl (5 Nov 2009). $1160 is Gold's Next Target Level: Charts. CNBC. http://www.cnbc.com/id/33632775.

Why the Gold Price Increase to $1,120 an Ounce?

Gold has been surging like we haven't seen it surge for years. This increase is significant because it continually reaches all-time highs, which today, has gold at $1120 per ounce.

The white metals are all well below their all-time highs, but are still following gold up the ladder: platinum is at $1370 per ounce, 60% of its all-time high. Palladium is at $350 per oz, 32% of its all-time high. And silver is trading at $17.50 per ounce, 35% of its all-time high.

Unlike gold, the white metals are used in manufacturing and used up. With the recessed economy they aren't in high demand, so their price jumps are not industrial, but rather, they're following gold as hedges.

Now let's look at some of the reasons gold has risen to $1120 an ounce.

India

Central banks are buying gold. Most notably India. Last week the central bank of India bought 200 tons of gold from the International Monetary Fund (IMF). India is reported to want to diversify it's financial hedges. The sale was an alleged US $6.7 billion.

Central Banks

Several other central banks are reported to be buying gold to hedge against the risks of a falling dollar. Sri Lanka and China are on the list, amongst others. These purchases not only increase the gold price, but influence individual investors as well.

Since buying has begun, it may continue, thus making investors rush to buy before the price increases more. This interest may shoot gold well past anticipated levels due to overbuying.

Matt Zeman of LaSalle Futures Group Inc. is quoted as saying, "The interest that central banks have shown for gold has really lit a fire under the market...People are questioning the value of not only the U.S. currency, but all paper currencis. Investors are moe comfortable holding gold" (cited by Ngyuen and Larkin).

China

A simple report by the Chinese government saying it will start buying gold is enough to shoot the price up another $100 or more. A swift upturn in the Chinese economy would have a similar, yet softer effect.

Falling Dollar

If the dollar falls, the price of gold will go up in dollar terms. However, if the dollar falls, since many other countries hold US debt, gold will rise in terms of other currencies as well.

The dollar has reached a 15-month low on the dollar index. This index compares the performance of the dollar against other main currencies. This shows some of the reason for gold's surge, however, gold is also at an all-time high measured in euros. It's currently trading at around 750 euros per ounce.


Inflation

The world is worried about the dollar. With the trillions of dollars spent this year in bailouts and stimulus packages, the dollar is being printed like never before. The Fed is hoping this will stimulate the economy, and it may, but it will also likely cause inflation.

John Hathaway of Tocqueville Gold Fund is quoted as saying, "Would they be able to retract the liquidity they put into place?...If they havce a hard time doing it, I htink we'll see inflation, and gold will go much higher (cited by Ngyuen and Larkin).

And again, it's not only the inflation that's causing the gold to go higher, it's also the anticipation of future inflation causing investors to hedge now before prices go higher.

Interest Rates

The Fed has kept interest rates low in hope of sparking the economy. Low interest rates means cheap loans for housing and month thrown back into the economy.

Zeman says, "The dollar is not going to get any firm footing with rates at zero...People are selling dollars and putting it in higher-yielding assest. All commodities are going higher" cited by Ngyuen and Larkin).

Goldman Sachs thinks that gold will reach $1200 with rates as they are. Also, since people are thinking rates will stay low longer, they're anticipating gold to go higher and buying more, thus increasing the gold price even more.

"Analysts said the dollar was smarting after Fed officials said on Tuesday that high unemployment and sluggish consumer spending were risks to recovery in the U.S. economy, which may keep the Fed funds rate low" (Tang and Harvey).

Other Factors

There are too many factors to list, but above are the main ones. Some others include the opening of the gold market back into Vietnam, spurred by investor demand. It was previously illegal to import gold into Vietnam.

The Chinese government has reportly encouraged citizen's to buy gold to hedge for inflation.

Gold Fields gold producer in South Africa is going on a labor strike. This just means less new gold coming out of the ground to sell.

* * *

Sources

Godt, Nick and Lesova, Polya. "Gold Hit Record Near $1,120 an Ounce." MarketWatch. November 11, 2009. http://www.marketwatch.com/story/gold-futures-climb-to-record-above-1117-2009-11-11

Tang, Frank and Harvey, Jan. "Gold Rises Towards $1,120 on Strong Sentiment." Reuters. November 11, 2009. http://www.reuters.com/article/ousivMolt/idUSTRE5A80MQ20091111?pageNumber=2&virtualBrandChannel=11604&sp=true

Nguyen, Pham-Duy and Larkin, Nicholas. "Gold Futures Rise to Record on Speculation Dollar Will Decline." Bloomberg.com. November 11, 2009. http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aJwZs1AweH_s

Jim Sinclair Says the Dollar is Dead

In his article "Motivation Behind the Countdown," precious metals specialist Jim Sinclair (August 14, 2009) gives us his view of the US dollar's fate for November, 2009. The prediction isn't pretty.

The reason for Sinclair making this assumption is that China requested a financial summit with the US. These things are seldom requested. Sinclair states a couple things he sees happening.

1. The US need China to continue buying US debt, meaning the US needs China to continue lending it money
2. The Chinese want the US to support a "Super Sovereign Currency as an offset to dependence on the dollar for international settlements and national reserves" (Sinclair, 2009)
3. "The Chinese rightly feel that the greatest risk to their present dollar position’s valuation is quantitative easing. Or simply put, the monetization of one’s own debt by the electronic creation of money for funding yourself"(Sinclair, 2009)

Sinclair goes on to state that the Management of Perspective Economics only works in a strong market, which ended in 2001. No finagling will help the dollar now that the US has so much debt. Nor can the US dollar survive if we support a "Super Currency," as Asia's holdings of the dollar are the only real support the dollar has.

Sinclair closes with the following:

"All of this could have been fixed prior to the event of Lehman declaring bankruptcy. Now there are no PRACTICAL SOLUTIONS....Pandora’s Box is open, only to be closed by markets as the downward spiral goes to its practical end, a return to commodity money."

* * *

This has been a complete summary. To view the full article, click here.


Sinclair, Jim (August 14, 2009). The Motivation Behind the Countdown. Jim Clair's MineSet. http://jsmineset.com/2009/08/14/the-motivation-behind-the-countdown.

Rhodium on the Rise!

Rhodium is again on the upward trend. Remember just a year ago it was down to $700 per ounce. Today is it $1800-2100 per ounce (that price discrepancy depends on who your quoting source is and whether you're buying or selling.

The chart below shows the price of rhodium as quoted by Kitco. You can see it's been steadily moving up from $1500 to $1800 over the past few days. The $2100 price is the quoted price if you want to buy an ounce of it, which is considerably higher.

Rhodium Price Chart

Rhodium Coins Prices Rising

If you'll recall we did an interview with Eitan Cohen of Cohen Mint regarding the minting of the Cohen Mint Coins (full article here). Checking the Cohen Mint Rhodium Bullion Coin site, since the coins came out a few months ago, they've climbed from their starting price of $89.99, to $92.99, to $99.99, to $102.99, and just today to $104.99. Rhodium bullion is rising so the cost of making rhodium coins is also rising. At $104.99 it will cost you about $3300 to get your hands on an ounce of rhodium (remember these are 1-gram coins so you'd need 31 to have an ounce).

You may be thinking that owning 31 small coins isn't the best way to own an ounce of rhodium. Let me tell you, though, it is the only way. There is a company online that allegedly will make a bar for you and sent it, but I haven't read about anyone ordering one from them.

$1100 Gold Coming Soon!

I was wrong. I said a couple weeks ago that gold will peak at around $1050 (but I searched to find where I said that, so I guess I'm not wrong, right?!). Today the gold price is $1095.

This is a historical high for gold in dollar terms, surpassing it's many previous highs that it hit in October, 2009. We've seen quite a few instances of a gold all time high over the past few months. Let's look at a chart which shows it a bit more clearly.

Rise to $1100 Gold Chart

As you can see from the chart above gold nipped $1000 in February, nearly did it in May (both were near historical highs at the time) and in September in remained comfortably over $1000 for over a month long period. In October its holding level was around the $1050 mark. Now we're tinkering with $1100. Will it hold here for a month again? I'm not going to take a guess this time!

And, for your reference, the chart below shows gold's previous run up to $1000 when it did it in the spring of 2008. Then it pretty much remained below $1000 for a year before continuing on its current spike.

Should You Sell or Buy Gold Bullion and Gold Coins?

Right now, if you paid under $700 for your gold bullion coin and would like to realize a $500 profit, I wouldn't say that you'd be making a mistake by selling it. I do think it will go higher, but that will be slowly and not a sudden increase unless if something drastic happens in the economy. So, also, if you decide to buy gold right now, your investment decision will also be wise! I do think gold will dip again, though.

Should I Sell Gold and Buy Silver?

I wouldn't say this is a bad strategy, since silver has a much higher chance to double or quadruple as gold does. If you've been reading the site you'd know that I have all my money tied up as it is and I'm not saving too much so I haven't been buying as I'd like to. I did manage to buy a few small silver bars the other day; and I didn't have to sell my gold to do it!

Holy Sh*t!: US Debt Clock Live

Discovering the US Debt Clock Live for the First Time

And holy sh*t is all I could say. I sat staring at the screen for five minutes without moving, trying to fathom the astronomical amounts of money I was seeing. After coming back to earth, my eyes started wandering down the clock to see the various forms of growing debt. The US government debt, yearly deficit, citizen's debt, is scary.

Numbers Explained

First, let me explain how much money we're talking about. I actually had to look up what comes after a trillion.

• 1,000,000 = 1 million (Brad Pitt made $20 million this year, Tiger Woods $100 million)
  
• 1,000,000,000 = 1 billion (Bill Gates and Warren Buffet are worth about $40 billion each)
  
• 1,000,000,000,000 = 1 trillion (US government has spent $3 trillion so far in 2009)
  
• 1,000,000,000,000,000 = 1 quadrillion

Screen Shot of US Debt Clock Live

Here is the exact screen shot that made me sit dumbfounded. I found the clock over at US Debt Clock.org (links below). However, realize that you're simply looking at an image. What I saw was more harsh.

US Debt Clock Screen Shot (click to enlarge)

(Screenshot taken Wednesday, October 28, at approximately 1:30 am)

US Debt Clock Climbing

Were you able to handle it? Did you read through all of the numbers? That was taken on Wednesday, October 28, 2009. What is the date today, and how much has it risen? This is what might boggle your mind like it did mine. Click on this next photo to go to the www USDebtClock org site. Not only will you see what you saw above, but it will be be climing as you watch it! If you don't know what a certain number means, simply run the mouse over the number and an explanation will pop up.

Current US Debt (click for today's figures)

(Screenshot taken Wednesday, October 28, at approximately 1:30 am)

How does that make you feel? If your son or daughter were born today he would be nearly $40,000 in debt if we divided evenly amongst all US citizens the $12,000,000,000,000 (trillion, I just wanted to write out all of those zeros). Staggering, isn't it?

How Much is a Trillion Dollars?

The US has over $100 trillion in unfunded liabilities, which includes Medicare and Social Security. Many soon-to-be retirees are worried the government will soon be unable to pay. $3.5 trillion of the $12 trillion US debt is held by foreigners. What happens when these creditors start demanding the US government to pay up?

On Inflation

Look at"Federal Reserve Money Creation" on the left hand side. Do you see how fast this is rising? They are printing money at a rate of $60 million per hour. This is why our palladium coins and gold bullion have been rising in value and why inflation has been a part of life since 1972 (before which the dollar was backed by gold). Eventually we will see gold, silver, and all other commodities reach astronomical heights. Technically, they should be much higher than they are now, but thus far people are trusting the US government to eventually pay its debts and things are still semi-stable.

I'm not going to write a book here. This is a choppy article of my thoughts; what went through my mind when I looked at the clock. I've read a lot of books about the economy, business, commodities, stocks, etc. Some of these books are from 2003, some are from the 90s, some are more recent. The other day I read one from the 70s when the debt was just a few $billion. Many mention the total US debt, which just a few years ago was $2-3 trillion. Now, it's $12 trillion and I'm just astonished.

National Debt Clock in New York City

Finally, here's a picture of the US Debt Clock pasted on a wall of a building in New York City for everyone to see. "The idea for the clock came from New York real estate developer Seymour Durst, who wanted to highlight the rising national debt" (http://en.wikipedia.org/wiki/National_Debt_Clock). Click to read the full story about the clock.

National Debt Clock (Click to enlarge)
(Linked image from Wikipedia)

What Does All This Mean?

What does this mean? That there are too many people in the world; there is too much money backed by no solid assets; there are too many people in debt; here is too much pollution; there aren't enough resources....I could go on. But the fact is that our society has become extremely complex in terms of the economy, resources, and population. Something big is going to happen in our lifetimes. And some of us will be prepared.

Palladium Shines! (Gold Price Predictions)

Palladium Shines!

Palladium is doing very, very well, folks! The gold price is glittering right now as people the see the $1050 price. This shows a near 10% gain for gold. Silver is up 14% to over $17.50 per ounce. Platinum, over the same time period of a month or so, rose under 10%.

But look what's shining: palladium! Palladium has risen 16% over the same time period. It's current price is $336 per ounce palladium coin or per ounce of palladium bullion. Buy palladium bullion as it's still a good investment. It woudl have been a better investment a few months ago at $180. Remember that?

Investment Strategy

We've been giving you tips every couple months on which metal to buy or which to sell. It's usually short and at first decided we wouldn't do this, but people like it so we're doing it. We never guarantee any of our predictions though, so keep that in mind.

Gold Predictions

We have a long-term prediction for ALL of the metals to rise. I think you know that simply by us maintaining a precious metals site. In the short-term, as in, what you should do right, we think you should buy silver. Silver has never been this under-valued compared to gold. When gold hit $1000 in 2008 silver bullion was selling at $22 per ounce or closer to $30 for the silver coins.

If you don't have money to buy silver now, Selling an ounce of gold (we're assuming there are low fees involved) for $1055 would buy you about 60 ounces of silver. So, six ten ounce silver bars (coins would likely cost more) could be had. We say that not only because we think silver undervalued versus gold right now, but because it is so rare and when demand increases so will its price.

Palladium Predictions and Platinum Predictions

We don't think palladium will reach $400 any time soon. Similarly, we don't think $1500 platinum will come any time soon. Gold's popularity, as evidenced by $1000 gold or $1050 gold, proves we're in a recession and people want to hedge with gold. Palladium hedge and platinum hedge don't work the same because they are more industrial in nature and will rise with more demand from auto manufacturers. In the long-term, both will rise, as we're predicting, but not this year.

(article unedited)

Here's an article predicting gold to reach $2000 within the next 10 years.