Silver Prices Don’t Reflect the Shortage

Posted June 18, 2008

“There in the window was a rather fetching kilo bar of silver. It looked destined for a role as doorstop in the Frisby household. ‘How much for that kilo bar?’ I asked. ‘ £425,’ came the reply.” — Dominic Frisby

by Dominic Frisby

Baltimore – (TFN): I was in Guernsey last week. While I was there, I thought I’d pop into one of the island’s famed gold- and silversmiths to pick up a bit of silver bullion. What happened next was a bit of a shock.

There in the window was a rather fetching kilo bar of silver. It looked destined for a role as doorstop in the Frisby household. “How much for that kilo bar?” I asked.

“£425,” came the reply.

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“But the spot price for a kilo of silver is only £275,” I spluttered. The assistant dutifully called her boss. After a hushed conversation punctuated by furtive glances in my direction, she returned. “We can do it for £415,” she announced generously.

“But that’s 60% above the spot price.”

“Ah, well. There’s a physical shortage, you see.” But is there really? Are these reports I’ve been reading about a silver shortage really true? Read on to learn why the silver prices you see may not be what you’re paying.

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