Reports from Spain say that physical precious metals are coming with significantly higher premiums now, due to the country’s and its southern European neighbours’ ongoing economic crisis.
Contradicting ECB statements claiming that the worst in Europe’s economic crisis is over and that there were significant signs of improvement throughout the continent, our boots-on-the-ground report paints quite a different picture. Popular silver bullion coins like the Canadian silver Maple Leaf are retailing for as high as €24 while the same coin is available in Germany (still 7% low tax) for as little as €19.66 to around €20.80 or via Norway (tax-free to all EU or EEA countries).
It is hardly surprising that in times of crisis, mark-ups over spot for Phyzz are high. In fact, paper and physical markets are entirely different beasts and tend to fully de-couple once there are shortages brought about by crises or buying panics. The fact that paper and Phyzz prices have been moving in lock-step and rather closely together in the more recent past should not be taken to confuse buyers as to the true nature of physical precious metals: a store of value and “insurance policy” against all kinds of broader economic risk. Very much as with common insurance, premiums tend to be higher when the risk is greater which, obviously, is the case during so-called dangerous times.
A price of €24 per ounce in Spain may still be a good price considering what might happen to someone continuing through these economic dire straits without any such “insurance”. That there are other sources charging “only” some €18.15 for Maples should not be taken as proof to the contrary — with increasing amounts of fakes even among relatively cheap-per-piece silver coins, the latter might rather be viewed cautiously and with usually much higher street prices in that particular location and during that particular time are, indeed, likely to be falsifications and to be avoided.