Thursday, May 27, 2010

Someone Might Call Rep. Weiner About This

Gold coins -not semi-numismatic gold coins, but regular sovereigns - have been sold at 40% above spot, and sometimes higher. That's right, they've been sold at the equivalent of $1,700/oz.

The only trouble with informing Rep. Weiner about it is that this premium has shown up outside of Congress' jurisdiction. They sold that high in Greece. reports that prices at which the Greek Central Bank is selling one ounce gold equivalents are as high as $1,700 (40% over spot), and prices on the black markets are even higher. The punchline, as Athens slowly returns to a forced gold standard: "A popular spot for street vendors to sell their coins is near the Athens Stock Exchange. There the traders wait for citizens to bring payments received from unloading their paper assets like stocks and bonds.” That’s good – downtown Manhattan close to the NYSE has some free space for gold vendors to set up shop as well, they just need to push some of the frontrunning/collocation boxes off to the side. And in other rhetorical ruminations, is it safe to say that the last days of the fiat experiment are among us now that people themselves are bypassing the government and enforcing their own gold standard?
This eye-opening item comes courtesy of "Tyler Durden" of Zero Hedge, as rewebbed by Prison Planet. To be fair, it isn't just a matter of a buying panic: the Greek government does impose legal restrictions upon the import and sale of sovereigns. Had the Greek gold market been more free-flowing, as the U.S.' is, then the premiums would never have gotten that high.

It does serve as an object lesson on what supply controls can do.


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