Kitco / Perth Mint / AGR Matthey / Bullion Bank Connections
Silver Stock Report
by Jason Hommel, May 17th, 2008
Kitco's online store sells Perth Mint
Mint owns 40% of AGR Matthey.
If The Perth Mint is storing
your metal, they admit that they may have loaned your metal
"The $880 million of precious metals deposited by
Perth Mint Depository clients (note 17) was used in
operations by Gold Corporation as inventory ($381 million - Note
8b) with the balance in the refining operations of AGR
"AGR Matthey has well established
relationships with the major bullion banks and
regularly supplies to them on a contractual
is as important as refining efficiency,"
"Treasury undertakes a
leasing program to either lend or borrow precious metal
within the terms of a lease agreement between AGR Matthey and approved
The Mogambu Guru
"Unallocated gold is the most widely traded form of gold in the
world. While this gold remains unallocated to you, the regulator
considers it part of a bank's liquid reserve."
that 99% of gold deposits are in unallocated form, and therefore all the
deposited gold is, in effect, in a big commingled pile in the basement of
Another way of looking at this stunning fact is, "This
makes unallocated gold an attractive way for the bank to maintain its
regulated liquidity, because you have paid for your gold, and the
bank is free to use your money, while it is also able to add your
unallocated gold holding to its own reserve."
"I found it appalling that Morgan Stanley would
claim to store silver that didn't exist and even have the
chutzpah to charge for the storage."
"In fact, in the court documents summarizing the proposed settlement,
one of Morgan Stanley's defenses was that they were not doing anything
unusual by charging storage on metal that didn't exist, as this is
a widespread industry practice."
you know why I say:
physical silver costs about 5-7% over spot, that's
standard. Why? Risk. Silver prices can move that
much in a day, and if dealers sell you their silver, they take on both
price risk and default risk if they go to replace it, after selling it to
you. They buy silver at about 0-1% under spot from the public, who
may sell at random times. If they order from another dealer, they
will have to pay that 5-7% over spot fee, and charge you about 1% over
what the other dealer will charge. Again, because of risk. If
you don't like those terms, then open your own bullion shop, pay
rent, find your own suppliers, risk getting robbed, and
deal with crazy people who will loiter in your shop
and waste your time and prevent you from trading stocks,
I know you can't always locate a shop near you with good
terms, and who has any physical bullion, because the stuff is
Questions to ask an internet dealer that may live far away
1. What kind of silver do you have in
2. How much of that kind of silver do you have available
3. How much of that do you have in your
4. How long will it take to ship?
5. Will you drop
ship my order from another dealer, and if so, what is that dealer's
Those questions will help you discover if your dealer
is honest. I will order from dealers who have to order from other
dealers, but I'll have my dealer ask the other dealer those same
Any order should take 1 week to ship, or
less. All orders should be shipped within a day or two after your
wire or bank check arrives, and most shipping takes 3 days anywhere in the
U.S., so anything longer than a week is something to worry about, in my
One time, my dealer ordered from another dealer, 100
Englehard bars. We were very specific to say Englehards only, no
Johnson Matthey bars. We were very specific to ask, "How many do you
have in stock" and "Are you sure you have those exact bars in
stock". They lied. They had to order elsewhere, and it took 2
weeks, and the order was shipped in several piles, and the later shipments
contained JMs. That's how I know shipping should only take one week
or less -- from personal experience.
Many silver bars are
tarnished, blackened, dented, scratched, and quite banged up. That's
normal. They stopped making the bars long ago, and have been handled
and abused many times.
It is likely easier to find and get 90%
junk silver coins dated 1964 and earlier right now; they tend to trade at
about spot prices, and are a bargain.
http://fidelitrade.com/ has 90%,
great prices, and I've heard no complaints about the
Smaller traders might consider www.ebay.com but check the seller's
Since many dealers are reporting shipping times of over
a month, shortages abound.
If you don't own the safe, you
don't own the contents.
If you can't touch the metal, you don't own
Do not store stuff in a bank's safety deposit
Not-So-Safe-Deposit Boxes: States Seize Citizens' Property to
Balance Their Budgets (May 12th)
"California law used to say
property was unclaimed if the rightful owner had had no contact with the
business for 15 years. But during various state budget crises, the
waiting period was reduced to seven years, and then five, and then
three. Legislators even tried for one year. Why? Because the
state wanted to use that free money."
Hints on storing your own silver:
Buy a safe of the right size. Get a lock box at an office supply
store, or discount store. Next size up, get a small floor
safe. Next size up, get a gun safe. Next size up, get several
large gun safes. Next size up, build a vault.
Bolt your safe down, from the inside, to either wall studs, or the cement
3. Cover your safe with a wooden cabinet, or put it
in the closet, or buy a floor safe, or wall safe. Consider other
hiding locations, but it's best to hide the safe, not the bullion
4. Split up your safes, put one in the house of a family
or friend; you don't have to give them the combination. Pay them a
small, reasonable, rent fee of 1/2 of 1% of the bullion value, per year,
or less. Or, put one in a storage shed, or storage
5. Get a home security system, and/or dogs, and/or a
firearm for additional protection.
6. If you live in a
dangerous neighborhood, maybe move, and rent in a better
In case you miss an email,
check the archives:
You can buy silver in
lots of 100-500 oz. at my auctions at www.seekbullion.com
Auctions end M-Th, Sat, At 7PM Pacific, but you can place bids anytime, 24/7.
Wires only. USA Shipping only.
You can also buy silver at www.momsilvershop.com
ship overseas, and also in lots of more or less than 100
See us also at:
4870 Granite Drive, Rocklin, CA 95677