Has the secondary silver market hit the market saturation point.

[Gordy]

2 minutes ago, bluemoon said:

Perhaps we're speaking at cross purposes. Are you a registered VAT business? Because yeah that sucks. I'm just a nobody stacking silver, so I wouldn't need to collect VAT from someone I flog a tube to. I do feel for the businesses. The government imposing this VAT cause a great deal of trouble through their socialist greed.

Capitalist or socialist? 

[Agaupl]

6 hours ago, bluemoon said:

Perhaps we're speaking at cross purposes. Are you a registered VAT business? Because yeah that sucks. I'm just a nobody stacking silver, so I wouldn't need to collect VAT from someone I flog a tube to. I do feel for the businesses. The government imposing this VAT cause a great deal of trouble through their socialist greed.

No I’m not a vat registered business… but if I bought silver in the uk from a dealer I’d paying vat. And if you are buying secondary you should also be covering vat paid by others , otherwise they will be selling at a loss, which isn’t sustainable, hence the thread. Collecting vat has nothing to do with it. VAT is a cost of doing business and although it only paid once it affects the whole downstream value.. or should do.   

 

but I don’t buy silver in the UK so I don’t pay VAT at all and that makes making a profit from spot price movements much easier… which was my point. 

Edited March 21 by Agaupl

[Spark268]

7 hours ago, Agaupl said:

And if you are buying secondary you should also be covering vat paid by others , otherwise they will be selling at a loss, which isn’t sustainable, hence the thread

there is no law, natural or otherwise that says you should do this. The only way this is possible is that the market premiums have been sufficient larger than 20% for some time, but this is not guarunteed.

you only get back spot when selling to the dealers.

The VAT sucks, but the expectation is that over time, any price rises should cover this.

 

Edited March 21 by Spark268

[Upsidedown]

Right. Who was it that first mentioned VAT?

[Agaupl]

25 minutes ago, Spark268 said:

there is no law, natural or otherwise that says you should do this. The only way is possible is that the market premiums have been sufficient larger than 20% for some time, but this is not guarunteed.

you only get back spot when selling to the dealers.

The VAT sucks, but the expectation is that over time, any price rises should cover this.

 

very confused this answer   

There is of course no law. The market dictates that to make a profit you need to sell for more than you bought for. Yes people can and do sell at a loss but it is self limiting. If you would like to sell at this loss I’m sure you will have buyers. 
 

yes you can reduce the premiums to near nothing, but unless they are nothing  you will still need to charge spot plus 20%. Unless you are paying less than spot or not paying tax.if you then resell at spot .. you need spot to rise 20% to break even.  Could it rise by more than 20% sure. But it going to need a big big move. And as Gordy said. This is how good holder have made a good profit recently. But if gold attracted vat then they be in the hole too right now despite the huge move.
 

If I’m missing your point, which is entirely possible,  please explain to me. 

Edited March 21 by Agaupl

[Agaupl]

15 minutes ago, Upsidedown said:

Right. Who was it that first mentioned VAT?

It doenst matter if it’s vat or any other cost. The ‘I don’t need to collect vat on sales’ is mute. 

[Spark268]

48 minutes ago, Agaupl said:

very confused this answer   

There is of course no law. The market dictates that to make a profit you need to sell for more than you bought for. Yes people can and do sell at a loss but it is self limiting. If you would like to sell at this loss I’m sure you will have buyers. 
 

yes you can reduce the premiums to near nothing, but unless they are nothing  you will still need to charge spot plus 20%. Unless you are paying less than spot or not paying tax.if you then resell at spot .. you need spot to rise 20% to break even.  Could it rise by more than 20% sure. But it going to need a big big move. And as Gordy said. This is how good holder have made a good profit recently. But if gold attracted vat then they be in the hole too right now despite the huge move.
 

If I’m missing your point, which is entirely possible,  please explain to me. 

I wrote my original post quoting yours, using language a 12 year would understand.

if this confuses you, i can only apologise.

 

[Agaupl]

24 minutes ago, Spark268 said:

I wrote my original post quoting yours, using language a 12 year would understand.

if this confuses you, i can only apologise.

 

Wow. What a nice guy 

Edited March 21 by Agaupl

[FriedrichVonHayek]

I think that people have been spoiled on this forum, and despite the prices of Silver being extremely cheap, its as if some people expect to buy Britannia's at around spot. 

I have a few Britannia's to shift and as usual I will incur a small loss.

From now on I'm only going to buy scrap Silver as it can be bought for around the scrap price and it can be easily offloaded to a Bullion dealer.

I sold a little bit of Gold a couple of months ago and just sold it to Atkinson's as it's hassle free and you receive the same price as on the forum.

[Spark268]

2 hours ago, Agaupl said:

Wow. What a nice guy 

thanks, i hear that quite often 😁

[Agaupl]

3 minutes ago, Spark268 said:

thanks, i hear that quite often 😁

Still have no idea what you are talking about though. Or most of your other posts. I wasn’t being funny I was just asking for clarification. Didn’t really need to react like that tbh 🤷‍♂️

[Spark268]

1 hour ago, Agaupl said:

Still have no idea what you are talking about though. Or most of your other posts. I wasn’t being funny I was just asking for clarification. Didn’t really need to react like that tbh 🤷‍♂️

if you wanted to ask for a clarification, you should have just asked for one.  Things like please and thank you are optional, but go a long way, both in the the UK and Australia. You did not do any of this.

Given all my posts confuse you, i am flogging a dead horse anyway.

 

 

 

 

[Agaupl]

 

13 minutes ago, Spark268 said:

if you wanted to ask for a clarification, you should have just asked for one.  Things like please and thank you are optional, but go a long way, both in the the UK and Australia. You did not do any of this.

Given all my posts confuse you, i am flogging a dead horse anyway.

 

 

 

 

Did you miss this bit?

5 hours ago, Agaupl said:

If I’m missing your point, which is entirely possible,  please explain to me. 

[Spark268]

I did miss that and i apologise. You started that post critisising mine and lost me there.

I'm going to move on, if you don't mind. 

 

 

 

[Agaupl]

7 minutes ago, Spark268 said:

I did miss that and i apologise. You started that post critisising mine and lost me there.

I'm going to move on, if you don't mind. 

 

 

 

No sir, you took a small spelling error as a criticism which was never meant. I meant to write “ very confused BY this answer” but I had a small child climbing on me at the time and I missed the ‘by’.  
very easy to do , and my fault. I was genuinely interested. 
 

Over text misunderstandings are easy, I’ve done it myself  .. but on TSF at least .. usually exactly that . Misunderstanding and genuine interest. 
Let that be the end of it sir  

 

[Spark268]

ahh the bain of textual conversation, and mis understandings thereof. I have taken some flak earlier on in this thread and that made me overly defensive. I'm sorry for this and thank you for perservering

You are right in that the price needs to compensate buyers for the hit that they take on VAT, otherwise they lose money.  Recently, since 2020 atleast, there has been a difference between the quoted silver price (currently at £19.91) and the sales price on here £22-23, or on other secondary venues, known as a premium.  Dealers have this premium plus VAT on top, meaning that places like BBP are charging up to £29.

I think this premium is more as a result of supply and demand, rather than a compensation for any VAT paid. If supply continues to outstrip demand, then that premium could disappear also.

 

[Agaupl]

1 hour ago, Spark268 said:

ahh the bain of textual conversation, and mis understandings thereof. I have taken some flak earlier on in this thread and that made me overly defensive. I'm sorry for this and thank you for perservering

You are right in that the price needs to compensate buyers for the hit that they take on VAT, otherwise they lose money.  Recently, since 2020 atleast, there has been a difference between the quoted silver price (currently at £19.91) and the sales price on here £22-23, or on other secondary venues, known as a premium.  Dealers have this premium plus VAT on top, meaning that places like BBP are charging up to £29.

I think this premium is more as a result of supply and demand, rather than a compensation for any VAT paid. If supply continues to outstrip demand, then that premium could disappear also.

 

Appreciate that mate.
 

I agree the market is the market. And without manipulation supply/demand is the driver.
But my point was and I think it’s been made before is the base price for an item is cost price + governmental tax/protection monies + costs of business.  With silver the government levy is 20% so even without costs of business (refining, minting, sales, delivery) even if you buy at spot.. in the UK your minimal cost is spot plus 20%, in reality more. People can and do sell at less than this at times . Due to personal circumstances but that is self limiting in a free market. Some entities may even want to do so to register a capital loss. But it’s not sustainable over the long term and this is deflationary which i think the point of the thread. 
Premium isn’t just dealer profit it’s cost of doing business  .. and people will come in to disrupt the market by reducing this premium , as in the Amazon model of selling books, but I think this is detrimental in the long term as it reduces incentives and diversity of stock.  plus traditionally sales provide a hobbyist cyclical economy on the forum  I sell you those, you pay me, I buy that from someone else. When the sales are dominated by entities that are only sellers, it’s a currency exchange out of the forum. Secondary sales then don’t  happen  the sales page dies. Same thing has happened in every industry… and invariably leads to higher prices in the long term. I think this is the point @Fenlander1 was making. The sustainability of the hobbyist buy/sell community vs short term gain  

 

 

But my point was .. which other asset would you choose to buy , where you were immediately (at least, with zero premium) 20% in the hole? 
if you buy gold at spot, it goes up by 1%, sell at spot you’ve made 1%… say £17/oz

If you buy silver at spot, it goes up by 1%, sell at spot you’ve lost 19%… say minus £.35/oz.. plus the amount of cash you’d have to tie up and the huge opportunity cost premium. 

yes a huge spot increase could wipe that out … but what assets do you buy knowing you are 20% down straight  away? That’s not an asset that’s a liability. This isn’t opinion or ideology. It’s just fact.

 

with gold pretty much everyone, even those selling for spot or lower are still making a profit. And that makes it sustainable … atm at least b

Edited March 21 by Agaupl

[Fenlander1]

When I started this thread I didn't expect the explosion that happened. It was just an observation of the current market using a bit of basic economics.

My question was nothing to do with vat fraud we all know it happening so that's nothing new. As a sidebar to that it has nothing to with Race, Creed or religion is fuelled by basic greed.

So I reiterate.

Are we at a point with silver where the major manipulation and it is major of a price point has affected the secondary market.

Reading all the comments I believe we are and i will be adjusting my investments accordingly as its now obvious to many that silver is no longer an investment commodity in the UK for a while to come.

There will always be those that believe cheap is best that's just the insular society we live in today where the bigger picture is not their problem And then the moaning starts when it's time to sell as we are already seeing.

Edited March 21 by Fenlander1

[GoldDiggerDave]

@Fenlander1 Its been good to bat around mate,  theres a few passionate people and thats good to see and theres nothing wrong with some people having opposing views and opinions  as we are still allowed to disagree (just about).

I've been saying for a while if silver on the secondary market gets under £20 I'll bail in and buy a car boot full and play for 20%........Just god knows where I'm supposed to store it all 🤣

 

 

 

[James32]

1 minute ago, GoldDiggerDave said:

@Fenlander1 Its been good to bat around mate,  theres a few passionate people and thats good to see and theres nothing wrong with some people having opposing views and opinions  as we are still allowed to disagree (just about).

I've been saying for a while if silver on the secondary market gets under £20 I'll bail in and buy a car boot full and play for 20%........Just god knows where I'm supposed to store it all 🤣

 

 

 

Car boot obviously 

[Fenlander1]

2 minutes ago, GoldDiggerDave said:

@Fenlander1 Its been good to bat around mate,  theres a few passionate people and thats good to see and theres nothing wrong with some people having opposing views and opinions  as we are still allowed to disagree (just about).

I've been saying for a while if silver on the secondary market gets under £20 I'll bail in and buy a car boot full and play for 20%........Just god knows where I'm supposed to store it all 🤣

 

 

 

Buy a boat, worked for me

[GoldDiggerDave]

4 minutes ago, James32 said:

Car boot obviously 

I did think of that but really don't fancy the poor MPG it would give me driving around with 20 monster boxes in the back. 

[Agaupl]

 

24 minutes ago, GoldDiggerDave said:

@Fenlander1 Its been good to bat around mate,  theres a few passionate people and thats good to see and theres nothing wrong with some people having opposing views and opinions  as we are still allowed to disagree (just about).

I've been saying for a while if silver on the secondary market gets under £20 I'll bail in and buy a car boot full and play for 20%........Just god knows where I'm supposed to store it all 🤣

 

 

 

Remember though as a non vat registered private seller you are not legally required to collect vat…🤯🤯

Edited March 21 by Agaupl

[Tn21]

Interesting to see people's view on an Oz of silver here on the forum given the recent price rise and also much less availability on the silver front 

[James32]

Just now, Tn21 said:

Interesting to see people's view on an Oz of silver here on the forum given the recent price rise and also much less availability on the silver front 

I've always worked of a £4 average premium, so imho silver should now be trading at £25.50 per oz for recognisable coins.