US Mint Clarifies Statement Regarding Global Silver Shortage

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The US Mint released a statement confirming a global shortage of silver after the website outages during the pre-sale of the 2021 Morgan Dollar commemorative coins.

“The global silver shortage has driven demand for many of our bullion and numismatic products to record heights. This level of demand is felt most acutely by the Mint during the initial product release of numismatic items.”

US Mint Press Release

This appears to be the first indication from a government agency acknowledging what many have been speculating for more than a year.

The lockdowns at the beginning of the COVID-19 pandemic forced the closure of many mines and the supply chains that turn raw ore into fine silver and gold. 

The shutdown of the mines and supply chains led to refineries scrambling for raw materials and mints running out of product to sell.

After some backlash, the US Mint has revised its statement about the shortage. 

“In more precise terms, the silver shortage being experienced by the United States Mint pertains only to the supply of silver blanks among suppliers to the U.S. Mint.”

US Mint Press Release

Silver blanks are manufactured for the US Mint by private mints. The US Mint didn’t specify which private mints were having issues supplying silver blanks. It has been documented previously that the US Mint has bought silver blanks from private mints such as Scottsdale Mint, Sunshine Minting, Coins’n’Things and other major industry players.

The US Mint has delayed the remaining pre-sales of the 2021 Morgan Dollars and 2021 Peace dollars. The prospective launch dates have yet to be announced.

Low Premium Fractional Gold

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20 Francs Gold Coins
Supply chains from mine to mint have been severely disrupted over the past year. Demand for precious metals has been in high demand. Premiums on silver have gotten insane. 

Leading world economists are predicting a spike in inflation due to a combination of record amounts of new fiat being created and huge amounts of government spending. 

One way of continuing to stack as a hedge while saving on the current high premiums on silver is to buy low premium fractional gold. 

Some of the lowest premiums on gold can be found in vintage coins that were minted in Europe in the late 19th and early 20th centuries. 

Fractional gold coins, such as the British Gold Sovereign, 20 Francs Gold Coins of the LMU, gold Ducats and Coronas often carry the lowest premiums when compared to modern gold bullion coins.

With uncertain economic times ahead and the anticipation of regulation in the crypocurrency market there are many investors looking for a safer hedge. 
 
British Gold Sovereigns

The Gold Sovereign from Great Britain is one of the most common vintage gold bullion coins. The British Gold Sovereign has been minted since 1817, but it’s history dates back much further. 

Most incorporate the iconic image of King George slaying a dragon on the reverse, with a portrait of the reigning monarch at the time of minting gracing the obverse. 

Each British Gold Sovereign coin contains .2354 troy ounces of gold, just shy of a 1/4 troy ounce. There are dozens of variations of the Gold Sovereign, minted in 22k, 91.67% gold. 

Gold Sovereigns are widely recognized worldwide and are considered to be a very liquid bullion coin. Since each coin contains just shy of quarter ounce of gold it is easy to store a tremendous amount of wealth in a compact amount of space. 
Gold 20 Francs LMU

The Latin Monetary Union (LMU) was an establishment of a gold backed “Euro” currency. The LMU was established in 1865 by treaty between France, Switzerland and Italy. Other countries eventually joined, including Belgium, Spain and others. 

Each country was responsible for minting gold and silver coins that adhered to a standard based on the French Franc. Gold coins, such as the 20 Francs, were produced by the millions.

The designs vary by country of origin, but most include a portrait of the reigning leader of the country at time of minting on the obverse. The reverse will vary depending on the country of origin, but will often display the term “20 Francs” or some variation of it.

Some also include the local country currency as well. For example, the 20 Francs Coin from Italy also include “20 Lira”, the 20 Francs from Hungary includes the designation of “8 Forint”, Austria includes “8 Florin”, etc.

20 Francs Gold Coins have become very popular amongst stackers due to their low premiums. Each 20 Francs Gold Coin is minted from 90% gold and contains .1867 troy ounces of pure gold.

Popular 20 Francs Gold Coins include:

20 Francs Gold Helvetia from Switzerland
20 Francs Gold Rooster from France
20 Francs/20 Lire from Italy
Random 20 Francs
Gold Ducats from Austria & Hungary

The Gold Ducat was used as a trade coin. Trading merchants would use these gold coins to settle accounts for large transactions and international trade. The Ducat became popular with the Venetians when Venice was a popular trading destination. Many countries issued Gold Ducat coins.

Each Gold 1 Ducat coin contains roughly .1123 troy ounces of pure gold. Each coin is minted from 98.6% gold. Larger sizes were minted, including the 4 Ducat.

1 Ducat from Austria
4 Ducat from Austria

2021 Morgan and Peace Dollar Release Dates Announced

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This year is the 100 year anniversary of the introduction of the Peace Dollar. In 1921 the US mint produced both the Morgan silver dollar and the Peace silver dollar coin.

To commemorate the centennial the US Mint will be issuing both of these coins this year. 

The US Mint has announced that the new commemorative 2021 Morgan and Peace dollars. 

There will be 5 distinct variations of the 2021 Morgan Silver Dollar. Each coin is to be minted of .858 troy ounces of .999 fine silver. The coins will all have an uncirculated, or “burnished” finish.

  • 2021 Morgan Silver Dollar – Philadelphia Mint with “O” privy mark on the reverse
  • 2021 Morgan Silver Dollar – Philadelphia Mint with “CC” privy mark on the reverse
  • 2021 Morgan Silver Dollar – San Francisco Mint with “S” mint mark on the reverse
  • 2021 Morgan Silver Dollar – Denver Mint with “D” mint mark on the reverse
  • 2021 Morgan Silver Dollar – Philadelphia Mint with no mint mark or privy mark on the reverse

The 2021 run will be a limited mintage run of 175,000 of each Morgan Silver Dollar coin type, mint mark or privy mark. 

The 2021 Peace Dollar will be produced without any mint mark or privy mark on the reverse. This is usually indicative that the coins will be produced at the Philadelphia mint location.

The 2021 Peace Dollar will have a limited mintage of just 200,000 coins total.

The US Mint has announced that these coins will go on sale via their website beginning June 7, 2021 at noon eastern time. 

You can sign up on the US Mint website to receive reminders on the day these are released. 

There is a lot of buzz surrounding the release of these commemorative coins.

With a release price of $85 per coin, there is a very good chance that they will sell out within minutes of becoming available, with the true value being driven by the collectors market.

Why does silver sell above spot price?

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comex silver bars in warehouse

An explanation of silver premiums

Spot price is the paper trading price for a COMEX futures contract of 5,000 troy ounces of silver.

One way to think about it is like barrels of oil. A barrel of crude oil contains 42 US gallons and is trading at around $65 per barrel, or roughly $1.57 per gallon.

So why is the price of gas at my local gas station higher than $1.57 per gallon?

There is a markup that comes at each step in the supply chain before it reaches the consumer.

Let’s say that a private mint like Scottsdale Mint buys a 5,000 ozt contract from COMEX and takes delivery.

There are costs to take delivery of the raw product, including transportation, security, settlement costs, etc.

The delivery will most likely consist of five 1,000 ozt bars.

The next step is to cut up a 1,000 ozt into pieces that can be melted down or to feed into an extrusion line.

Labor costs, cost to operate the furnace, equipment costs, etc.

Once the bar is in liquid form it can then be poured into molds to form bars. Or if the mint is using extrusion, into sheets or extruded bars, etc.

After that it needs to be weighed and stamped or pressed then packaged up to be sent to wholesalers or retailers.

The wholesaler will need to pay the mint for the manufacturing costs plus their profit and the cost of transportation from the mint to the wholesalers warehouse or depository.

The wholesaler then incurs costs to warehouse the metal, employ people to take orders, and pack and ship to retailers.

The retailer will pay for the metal plus the profit margins the wholesaler needs, the transportation costs from the wholesaler to their warehouse, depository or retail store.

Then the retailer has overhead costs. Rent, employees, utilities, etc.

They also need to make a profit if they are going to stay in business.

Each step along the supply chain adds additional cost.

These costs are all factored into the premium, which is why it costs more than spot price to buy silver.

American Silver Eagle Mintage By Year

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2018 American 1 oz Silver Eagle

The American Silver Eagle Coin is minted annually by the US Mint since 1986. The US Mint produces only enough coins that they think they will be able to sell to investors. American Silver Eagle Mintages vary year to year based on investor demand.

Annual American Silver Eagle Mintage Numbers

The Liberty Coin Act of 1985 authorized the US Mint to create the first American Silver Eagle coins in 1986. The law set base design specifications and standards for the Silver Eagles that includes:

  • The coins will be 40.6 millimeters in diameter and weigh 31.103 grams
  • Each coin will contain .999 fine silver
  • Each coin will  feature a design symbolic of Liberty on the obverse side and of an eagle on the reverse side
  • Each coin will be inscribed with the of the year of minting or issuance, the words ‘Liberty’, ‘In God We Trust’, ‘United States of America’, ‘1 Oz. Fine Silver’, ‘E Pluribus Unum’, and ‘One Dollar’
  • Each coin will have reeded edges

The Liberty Coin Act took effect on October of 1985 with instructions that the first coins would be released in September of 1986.

Many collectors want to buy an American Silver Eagle coin from each mintage year to build a complete set.

There are several Silver Eagle Dollar Coins that have continued to rise in price due to their rarity and demand from investors and collectors. The 1996 Silver Eagle Bullion Coin was the lowest mintage to date, with only 3.6 million coins produced. Even coins in poor condition can fetch high premiums.

The release of the 2019-S Enhanced Reverse Proof American Silver Eagle coin in November 2019 was met by incredibly high demand due in part to its limited mintage. The coin was limited to just 30,000 coins making it the lowest mintage of any variety of American Silver Eagle coin. This coin sold out from the US Mint website in under 15 minutes.

For Proof American Silver Eagles, the previously rarest coin was the 1995-W. Only around 30,000 coins were produced that year with the West Point mint mark. The coin was only available as part of a special 10th anniversary set.

During the Coronavirus Pandemic of 2020 the West Point Mint was shut down for the period from April 15 until April 21. From April 8 to April 20, the U.S. Mint added silver American Eagle production to Philadelphia. During that period the Philadelphia Mint produced 240,000 Silver Eagle Bullion Coins.



Silver Eagle Mintage by Year

Year

Bullion

Proof

Uncirculated (Burnished)

1986 5,393,005 1,446,778  
1987 11,442,335 904,732  
1988 5,004,646 557,370  
1989 5,203,327 617,694  
1990 5,840,110 695,510  
1991 7,191,066 511,924  
1992 5,540,068 498,543  
1993 6,763,762 405,913*  
1994 4,227,319 372,168  
1995 4,672,051 407,822  
1995-W   30,125  
1996 3,603,386 498,293  
1997 4,295,004 440,315  
1998 4,847,549 450,728  
1999 7,408,640 549,330  
2000 9,239,132 600,743  
2001 9,001,711 746,398  
2002 10,539,026 647,342  
2003 8,495,008 747,831  
2004 8,882,754 801,602  
2005 8,891,025 816,663  
2006 10,676,522 1,092,477 466,573
2006-P Rev Pr   248,875  
2007 9,028,036 821,759 621,333
2008 20,583,000 700,979 533,757
2009 30,459,000 0 0
2010 34,764,500 849,861 0
2011 40,020,000 847,473 409,766
2011-S     99,882
2011-P Rev Pr   99,882  
2012 33,742,500 832,779 226,120
2012-S   281,792  
2012-S Rev Pr   224,935  
2013 42,675,000 934,331 221,981
2013-W   235,689  
2013- W Rev Pr   235,689  
2014 44,006,000 894,614  253,169
2015 47,000,000 696,001  200,016
2016 37,701,500 595,664  216,422
2017 18,065,500 (W) – 389,994
(S) – 123,906 3
 176,739
2018 15,700,000 (W) – 352,141
(S) – 158,761
 138,947
2019 1 14,863,5001 (W) – 319,086
(S) -146,735
138,140
2019-W Rev Pr   99,911 4  
2019-S Enh Rev Pr   29,8232  
2020 5 30,089,500 (W) – 357,048
(S) – 146,729 (W) v75 – 75,0006
131,501
2021 7 Type 1 – 13,106,500
Type 2 –
   



American Silver Eagle Mintage Notes

1 – Sales totals through November 30, 2019. December Sales Totals Unpublished.
2 – Announced Mintage was 30,000 coins. Sales totals shown are based on sales data released by the US Mint.
3 – The 2017-S Proof Coin was released in two special sets. One called the “Congratulations Set” (17RF) with an announced mintage of 75,000 units. The other “Limited Edition Proof Set” (17RC) with an announced mintage of 50,000 units. Sales records show 48,906 Limited Edition Proof Sets sold. Sales records do not indicate how many Congratulations Sets were sold that year.
4 – The 2019-W Rev Proof was released as part of the “Pride of Two Nations” set (19XB)
5 – Updated 2020 basd on sales figures released by the mint January 5, 2020. The West Point Mint was shutdown from April 15 to April 21, 2020 due to the Coronavirus Pandemic. Minting of Silver Eagles was briefly shifted to the Philadelphia Mint and 240,000 ASE were minted. The only distinction of the Philadelphia ASEs is the box tracking numbers on the outside of the Monster Boxes. Box tracking numbers 400,000 through and including 400,479 were used on boxes of coins minted in Philadelphia. A total of 480 2020 American Silver Eagle Monster Boxes were minted at the Philadelphia Mint.

6 – The US Mint released a special proof American Silver Eagle coin to commemorate the anniversary of the end of World War II on November 5, 2020. This American Silver Eagle is the first to contain a privy mark embossed with v75. This special proof Silver Eagle has a limited mintage of 75,000 coins.

Source: USMint.gov Sales Reports

7 – 2021 will see 2 different designs of the American Silver Eagle. The “type 1” design, which has been the design since the program’s creation. The “type 2” design will be a new design and is expected to be released mid-year.

JM Bullion Acquired by A-Mark Precious Metals

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Precious Metals conglomerate A-Mark has announced that they will purchase online retailer JM Bullion. The acquisition follows a long time partnership between the two companies that dates back to A-Mark’s initial investment in JM Bullion in 2014.

In 2014 A-Mark acquired a non-controlling 20.5% stake in JM Bullion. The new deal will put the remaining 79.5% of the company under the A-Mark umbrella. The purchase price for the remaining 79.5% of JM Bullion is valued at $138.5 million dollars and includes $103.7 million in cash, plus $34.6 million in A-Mark stock.

JM Bullion co-founder and CEO Michael Whittmeyer will remain as CEO of JM Bullion. He will also join the A-Mark board of directors and assume the title of Execute VP of A-Mark’s Direct Sales line of business.

In addition to JM Bullion, A-Mark also owns several other direct to consumer precious metals businesses such as Goldline Inc and Silvertowne Mint.

The full press release can be found here.

/r/WallStreetBets Redditors Set Their Sites on Silver

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There has been a lot of news over the past couple of weeks about /r/WallStreetBets and GameStop. The people from this Reddit message board have caused lots of turmoil for hedge fund Melvin Capital and others. The group has encouraged it’s members to buy up GameStop stock and forcing Melvin Capital to cover it’s enormous short positions.

Some have begun setting their eyes on Silver as the next target. Many have long been believed that the silver market is heavily manipulated by the bullion banks, particularly JP Morgan.

Silver spot price has risen over $2.00 per ounce over the past couple of days as investors have begun buying up SLV, AG and physical silver hoping to ride the next wave.

Dealer premiums on physical silver have been dropping lower in recent weeks since hitting some highs last year as retail bullion supply has increased.

US Mint to Produce 2021 Morgan and Peace Centennial Silver Dollars

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Designs of the 1921 Morgan and 1921 Peace Dollars

This year marks the 100th anniversary of the switchover from the Morgan Dollar to the Peace Dollar in 1921.

Public Law 116-286, the 1921 Silver Dollar Coin Anniversary Act, was approved by Congress on December 19, 2020 and signed into law by the President on January 5, 2021.

The US Mint halted the production of the Morgan Dollar in 1904 after Congress repealed of the Sherman Silver Purchase Act in 1898.

Due to the Pitman Act, the Morgan dollar was once again minted in 1921. However, the Pitman Act called for a new design of the US Dollar Coin. The Peace Dollar design was chosen because it represented a shift in US culture post World War I from a nation at war to a nation at peace.

To commemorate the switchover the US Mint will be releasing Centennial Commemorative coins featuring the designs of these iconic silver dollar coins this year.

The Morgan Dollar, designed by George Morgan, was produced from 1878 until 1904, then again in 1921.

The Peace Dollar, designed by Anthony de Francisci, was produced from 1921 until 1935.

1921 Silver Dollar Coin Anniversary Act

The law specifies that the centennial dollars will weigh 26.73 grams with a diameter of 1.500 inches. The coins will be minted from no less than 90% silver with a reeded edge.

The design requirements specify that the commemorative silver dollar coins will have an obverse design and a reverse design that are renditions of the designs historically used on the obverse and reverse of the original coins. Mintage amounts or limits are excluded from the bill that was signed into law.

The bill does state that the coins must be sold at a price equal to the sum of their face value and the cost of designing and issuing the coins, including labor, materials, dies, use of machinery, overhead expenses, marketing, and shipping. Discounts will be available for bulk purchases, likely companies that are on the Mint’s list of Authorized Purchasers.

The final designs of the coins will be selected by the Secretary of Treasury with input from the Commission on Fine Arts and review by the Citizens Coinage Advisory Committee.

No official release dates for the coins have been specified yet.


JM Bullion Notifies Customers of Hack

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The website for online Precious Metals retailer JM Bullion was hacked earlier this year.

The company began notifying customers recently that malicious code had been discovered on their website. As part of the hack contact information and payment information may have been compromised.

JM Bullion became aware of suspicious activity involving their website around July 6, 2020. As part of the investigation it was determined that malicious code had been installed on their website. The malicious code had been in place for a six month period from February 18, 2020 until July 17, 2020.

During an investigation it was discovered that customers making purchases on their website may have had their data compromised. The data includes personal information, including credit card or banking information captured by a third-party.

The malicious code was removed from their website on July 17, 2020.

jm-bullion letter to customers of website hack and data leak
JM Bullion letter to customers of website hack and data leak

The stolen personal identifying information (PII) included customer name, address, and payment card information including account numbers, expiration dates and CVV security codes.

JM Bullion notified potentially effected customers via ‘Notice of Data Security Incident’ letter. What’s not clear from the letter is if the incident involved their website being hacked by a third party.

The data breach spanned six months. Customers that made purchases during this time frame were notified by the company.

The data breach was first reported in the r/Silverbugs group on Reddit by a customer that received the letter.

The hack occurred during a time when investor interest in precious metals reached a peak due to the economic uncertainty caused by the COVID-19 pandemic.

All customers who made purchases on JM Bullion’s site between February 18th, 2020 to July 17th, 2020 should monitor their credit card statements for fraudulent activity.

JM Bullion is one of the largest online precious metals retailers. They sell gold, silver, platinum, palladium and other bullion and coin investment products.

JM Bullion also owns and operates Provident Metals and Silver.com. It’s not clear from the letter whether this hack only impacted customer of jmbullion.com. Or if it also involved their other companies including  providentmetals.com and silver.com were also impacted.

2020 American Eagle Silver Privy Proof Coin – End of World War II 75th Anniversary

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2020 American Silver Eagle 75th Privy Proof - Anniversary of the End of World War II

End of World War II 75th Anniversary American Eagle Silver Proof Coin

The most anticipated coin release in recent time was last years’ 2019-S Reverse Proof American Silver Eagle coin. With only 30,000 coins minted, the coin was sold out in minutes from the US Mint website.

Many of those that were lucky enough to score one of these coins turned to eBay to sell for a quick flip. Some are still being sold in PR70 grades in PCGS and NGC slabs for over $2,000. PR69 Examples are selling for upwards of $1,000.

Pretty nice ROI for a coin that was sold by the US Mint for $65.95.

This year there seems to be a lot of hype lately around the US Mint’s upcoming release of a new Silver Eagle Proof coin. The coin is being marketed by the US Mint as a commemorative celebrating the 75th Anniversary of the End of World War II.

The coin is minted by the West Point Mint. It is a proof coin containing a special privy mark shaped like the reflecting pool at the World War II Memorial in Washington, DC. Inside the privy it is stamped with V75.

This is the first time the US Mint has release an American Silver Eagle coin with a privy mark.

The mintage will be limited to just 75,000 coins. Demand has been high for the coin. Some  dealers have already begun listing the coins for sale on eBay for presale at prices ranging from $800 – $1,500.

The coin goes on sale next Thursday November 5 at 12 noon eastern time. You can sign up for reminder alerts on the product page at the US Mint website. I’m sure this coin will sell out quick.

If you’re lucky enough to buy one of the 75,000 coins being made available it should be an easy flip for a huge ROI.


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