Demand For Precious Metals Causes Silver Eagle Shortage

One of the results of the current economicpriced at high premiums to the spot price of
downturn has been an increased interest insilver.
precious metals. People have sought to purchaseThe reason behind the rationing is that the United
precious metals for the purpose of hedgingStates Mint has been unable to obtain a sufficient
against inflation, diversifying assets outside ofsupply of precious metals blanks to manufacture
world currencies and financial products, andenough coins to meet public demand. The US Mint
investing in a store of value that has existed sincemust compete with other world mints for the
ancient times. World mints have struggled to keeplimited supply which remains available amidst the
up with the increased demand. A case in point hasbooming demand.
been the shortage of American Silver Eagle BullionIn 2009, the situation has continued. The 2009
coins experienced in the United States.Silver Eagle coins continue to be subject to
At the end of February 2008, the increasing levelrationing, although the blank supply situation may
of demand finally exceeded the supply of silverbe slowly abating. The US Mint managed to
bullion coins that the United States Mint was ableproduce a near record number of Silver Eagles
to produce. A suspension of Silver Eagle bullionduring the month of March. Several other bullion
coins was announced until the Mint could replenishcoins have had their releases delayed.
its inventory. The suspension was in place for lessCoin collectors, who purchase coins for their
than one month, but when sales resumed in April,collectibility of aesthetic features, have also been
the number of bullion coins that could be orderedimpacted by the shortage. Under United States
was rationed.law, the Mint must produce bullion coins to meet
The rationing process allocated a certain numberpublic demand. They are not required to produce
of coins to each authorized purchaser. Ancoins for collectors. This has forced the Mint to
additional amount of coins were allocated amongstprioritize production to silver bullion coins and delay
the dealers based on historical sales levels. Thisthe launch of collector coins. The collector coins
rationing often made it difficult for individuals toexpected to be released later in 2009 include the
find the silver bullion coins available for sale. Often2009 Proof Silver Eagle and 2009 Uncirculated
when the coins were available for sale, they wereSilver Eagle.