as of 2:24a Central Time Black Friday Morn: Gold Futures down -41.90 S&P Futures down -37.50 (a bad day would be in excess of -8.00 but -37.50? uh oh)
I expected Gold to drop because of the news that came out yesterday about suspension of sales for the 1 ounce American Gold Eagle coin from the U.S. Mint because they are in short supply.
-I expected Gold to drop because of the news that came out yesterday about suspension of sales for the 1 ounce American Gold Eagle coin from the U.S. Mint because they are in short supply.-
The news casters must have got a truck load of gold and try everything they can to boost the price up?
I woke up around 2AM Friday and decided to charge my iPhone. I peeked at the futures and thought "the quotes must be messed up", since the reaction to the Dubai news on Thursday was for gold to actually go up a bit. So I went back to sleep. Should've bought! Still made out OK because I was long GDX puts, which I sold a few seconds after the open on Friday.
It's common for the US Mint to suspend gold eagle sales when the price is gold is going up rapidly as is the case of late. It's not like a mom & pop gas station where they can change the price by clicking a few keys on a keyboard. It probably takes an act of Congress to up the price and they're not going to sell gold below market value. As to "because they are in short supply" I don't know where you got that information. But even if you got that info straight from the mint, I would not believe it. Sure they could be low if they did not ramp up production to meet the gold demand over the past couple years, but I would say it's more likely just a temporary suspension until they adjust their price. Keep in mind the US benefits from the price of gold going up and the value of the dollar going down. We as a nation are long gold and short (very short) dollars. When someone benefits from giving you information, you have to consider their motive and the credibility of that information.
What the mint said was "The US Mint has depleted its current inventory of 2009 American Eagle 1 ounce bullion coins due to the continued strong demand." and that sales would resume "once sufficient inventories ...can be acquired to meet market demand". News articles said this was bullish for spot gold prices. Some message board bears speculated that the coins were dropped due to low demand, but I think they were just making that up.