Gold Bullion, Americans Buying Again

New York (Oct 27)  Americans are buying Gold Bullion, the US Mint reported October sales of its American Eagle Bullion coins have almost tripled September sales.

With just a week left before the end of the month, the US Mint sold 38,000 oz of Eagles, compared with 13,000 oz  for September and 11,500 oz for of August.

While far short of the US Mint sales April of Y 2013′s high  of 209,500 oz, September’s rise tells us this;

1.  reports of Gold’s demise as a safe-haven investment are exaggerated. The US gov’t partial shutdown, and the last-minute temporary reprieve on the debt ceiling crisis served as a wake-up call to some investors discounting Gold Bullion’s value as a safe haven, and September’s weak jobs numbers rang the bell louder.

2. the demand for American Eagle  Bullion coins exceeded supply. When US investors buy Gold coins, they buy them in the market, which should have been flooded with Gold supply from other investors selling off their Gold. The real supply was short of rising demand and investors had to buy newly minted Bullion coins directly from the Mint.

3. the realization is setting in that the  fragile US economic recovery is still on life support, courtesy of the US Federal Reserve’s expirimental quantitative easing (QE-3) programs.

The partial gov’t shutdown puts more uncertainty in the October and coming November economic data.

The Congress and US President Obama pushed the problem out, there is little hope of a resolution in January. Without sound fiscal policy coming from the US Fed there is an reasonable expectation of an esclation of the Fed’s monetary expirment pumping more liquity into the markets.

We have heard a lot about Gold falling out of favor, what the naysayers do not say is the data that physical Gold sales are strong worldwide and that demand is starting up again in the US.  This is a continuing story, stay tuned…