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Why is Platinum so Cheap Right Now?
11-27-2018, 12:56 AM
Gold is currently selling for about $1,225. Platinum is selling for about $848. Throughout much of my life, platinum has been more expensive than gold. In 2008, platinum was about $2,000; while gold was around $800.
So, why is platinum so cheap?
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Why is Platinum so Cheap Right Now?
11-27-2018, 01:31 AM
Its industrial uses are in decline.
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Why is Platinum so Cheap Right Now?
11-27-2018, 06:30 AM
gold is money, platinum is an industrial metal used in the auto industry for catalytic converters.
10 years ago the industry switched over to palladium, which is a cheaper alternative to platinum.
Just because two things have a long term correlation does not mean that correlation has to be permanent. But you are not alone in making that mistake; some nobel prize winners almost blew up the world in 1998 with their hedge fund Long Term Capital Management.
Roger Lowenstein wrote a good book abou it, When Genius Failed: The Rise and Fall of Long-Term Capital Management. Random House. ISBN 0-375-50317-X.
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Why is Platinum so Cheap Right Now?
11-27-2018, 07:02 AM
Because the market can remain irrational longer than you can remain solvent.
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Why is Platinum so Cheap Right Now?
11-27-2018, 08:09 AM
Hypno nailed it, if you check the price of Palladium then you have your answer, Platinum got too expensive for it's principal purpose of use in catalytic converters and thus the majority of manufacturers shifted to palladium as it was significantly cheaper. Palladium has actually flipped the script now but it will need to go higher before the cost to change back to using platinum would be worthwhile as they have to change all the plants and infrastructure for it.
Palladium also riding the Chinese focus to reduce the pollution levels that are suffocating their cities and the shift away from diesel.
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Why is Platinum so Cheap Right Now?
11-27-2018, 09:53 PM
One of the big uses is in the catelactic converter in cars. Auto sales have been off a little lately, so that may be having an effect on the price.