The Phaserl


Is The Fractional Bullion Scheme Finally Beginning To Collapse?

from The Daily Coin:

We will not be receiving our shipment of RCM 10 oz Silver bars. This coupled with an internal inventory discrepancy has effected a few of our customer orders. We have been working diligently each day to secure RCM bars through various sources for our customers at any cost. Unfortunately, we were unable to fulfill some orders, including yours.   
–  Email sent to Provident Metals customers who prepaid for silver bars which Provident had represented to be in Provident’s inventory

“Internal inventory discrepancy?”  What other inventory discrepancies are occurring at Provident.   What kind of “inventory discrepancies” are occurring at other bullion dealers.  I can’t believe Provident sent notice of delivery default with a claim of inventory control issues.


Why not just admit the truth that the bullion dealer pre-sold bars that it was expecting to receive from the RCM and the RCM stopped production and ran out of supply before Provident received its full order allocation?

On the heels of Bullion Direct direct blowing up, this is another indicator that the fractional bullion system is beginning to collapse.

YTD silver eagle sales reported by the U.S. mint  are running well ahead of 2014’s record sales pace.   Gold eagle sales in July were up 456% from July 2014.  I heard today that the RCM is now putting silver maple leafs on allocation.   Retail demand for bullion is beginning to avalanche.

Gold sales in Malaysia were up 50% in July – LINK.   South Korea is on track to import a record amount of gold in 2015 – LINK.   Gold imports into India have accelerated well ahead of the biggest  seasonal buying period, which begins in a few weeks.  Deliveries into and withdrawals from the Shanghai Gold Exchange our occurring now at a record rate.

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4 comments to Is The Fractional Bullion Scheme Finally Beginning To Collapse?

  • Tea

    Folks, this is a lesson we all should learn and not pre-order merchandise or buy from companies who try to sell inventory they do not have in stock. You may be stuck with no merchandise and you may have to fight to get your money back. I thought Provident Metals was a trusted source but I guess when it comes to money who can you trust.

    • Ed_B

      I have purchased many silver coins from Provident with only one problem ever. In that case, Provident apologized for the inconvenience and added a free 1/4 oz. silver round for my trouble. But I think that they got trapped into thinking that when a national mint makes a promise they WILL keep it. They were promised these 10 oz. bars, knew that they had not been stiffed before, so figured that a bar that was promised to them was every bit as good as a bar on the shelf. Silver in the pipeline is NOT equal to silver that is in hand. Stackers KNOW this… but bullion dealers seem to be learning it only now.

      A good friend of mine refuses to buy any PMs from dealers who cannot put them into his hands when money is paid. None of this pay me now and I’ll deliver later nonsense for him. I’m not quite to that point right now but can see the validity of it, especially these days when bullion dealers are going bankrupt, shipping delays are long, and none of us really knows just how tight the silver market really is.

      I will say this, though. My LCS has always had a good stock of silver bullion… coins, rounds, and bars… in the past. The last time I went in was about 3 weeks ago. They had *1* ASE, about 20 silver Maples, and 3 silver bars. Yep, 51 oz. of silver when they usually stock between 1500 and 3000 ozs. On top of that, they wanted spot + $4 an oz. for their products. Between the sorry amount they had and the increased premium, I declined to buy. I dunno… maybe gold would have been a better buy?

    • Steelerdude

      Then Tea, you should treat it like the vegas casino we have with the stock market…buy only what you can afford to lose…

      or buy smaller quantities from a few dealers and see which one comes through

  • Tea

    Steeler, not many people are in a position which they can afford to lose money and buying smaller quantities seems to be a problem. U.S. Mint just recently resumed sales on silver eagles, Silvertowne bars will take up to 6 weeks to be fulfilled, RCM has stopped production on 10 oz. bars, and maples are being put on allocation. What will be left is more companies will do like MF Global, Tulving, and Bullion Direct by filing for bankruptcy in the meantime, saying merchandise is in their inventory when it is not which is lying to the customer and not a good reputable business practice. I think I will sit this one out because this is happening too much!

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