I’m new to PM but I’ve been doing a fair amount of reading in a short amount of time and I’d appreciate some feedback over my thought processes towards buying. To situate things a bit, I prefer silver, I’m Canadian buying in Canada with CAD and I’ve bought 11oz in my first month which is about what I see myself doing monthly, give or take a bit of course.
1) I’ve got a reputable bullion dealer in my city that I like to use. Nice clean office like storefront location and they will take all the time needed to talk with their customers. Their prices seem pretty standard and while I may be able to save a bit on my actual purchase if I bought somewhere online, with these guys I have no shipping fees and can walk out with my purchase.
2) They have everything from junk silver to “assorted” non mint condition silver bars at abou $1 over spot, “standard” mint sealed bars (from Sunshint Mint, NWT, Scotiabank…) at about $2 over spot to “recognized” mint sealed bars (JM, Engelhard, Credit Suisse…) At about $2.50 over spot. They also have rounds like Maples and ASEs but they naturally have a bit higher premium.
3) Everything, with the exception of the ASEs, is .9999 and thus far I’m drawn towards the standard mint sealed bars given their lower premium (and they are sealed so they stay pretty. lol) pay still more over spot just to have a bar stamped JM or a coin like round (although they sure look purdy)…I just don’t know.
It just seems to make more sense to me to spend as close to spot as possible but I see many here and on other forums also buying rounds too. Do you not view the higher premiums as wasted money? Is there some reason I’m missing when it comes to the higher premium bar or rounds? All thoughts and insight appreciated.
the right answer to anything generally is ‘it depends’
buying close to spot is great and a good strategy with little risk other than the underlying silver price.
Buying other rounds that may be collectible could pay off. I just netted $40 for a older Britannia that i paid an extra dollar over spot for vs. regular silver. That $40 for one ounce now buys nearly 2 oz of a current bar or round. The risk in this trade is that the coin never appreciates and you are forced to sell for spot.
Generally, the low prices right now are a good environment to try to sell more collectible coins, if prices rise I expect the opposite to be true.
I’ve been buying silver as a hedge against economic disaster. In a Mad-Maxx world, post- SHTF, I can imagine a time when fiat paper currency is worthless, and barter with precious metals, food, fuel, guns and ammo will be the way to survive. In such a world, I don’t think coin collectors will carry much weight. The honest weight, purity and authenicity of the gold or silver will be what’s important.
I almost always buy generic or bullion issues versus a “numismatic” that carries a premium…the higher the spot price rises the lower that premium goes, damn near directly inverse relationship unless it is a ridiculous coin, say MS68 Morgan $ or $20 Saint…those rarely fall out of bed but they are EXPENSIVE, say $2,500 for the Morgan and who knows for the Saint!
I would still buy $2,500 of bullion vs that Morgan
but in full disclosure, I have to admit to owning a NGC 1880-S MS68* Morgan, paid $2,850 a few years ago and have turned down $5,000 for it but that is a once in a lifetime coin for most (including me) and it will go down with me unless something totally unexpected happens and I have no other choice…which is why I bought it when I had the one chance…I have never even seen a higher grade in person!
That coin is nicer than most 2014 SAE’s right out of the monster box…I have no idea why it is” just” a 68…guess that is why NGC gave it the star…they will never grade another MS69
It depends what yor looking for and where your from. If your American And SHTF bars and rounds could sell at a big discount. The name of the game will be identifible. I started in 1981, and all I could get in bulk was rounds bars and junk, I still own the junk, but the bars and rounds are now gone, all traded at a rate of 23 rounds for a tube of 20 ASE`s. Remember in the 80`s and 90`s my cost average on the rounds was about $4.50 each.
Try this yourself. Take an ASE in one hand and a generic round in the other. Approach a non precious metals type and try to sell them, repeat this over and over, and you will discover what identifiable is, and that the current premium on ASE`s is well worth it.
I get your point Silver Dollar although I’d apply that logic to Maples, not ASEs. Spot finished here last night at $21.95 CAD making Maples approx $25.35 CAD each while ASEs go for approx $26.30 CAD each from a bullion dealer or $29.50 from the coin shop. $3.40 over spot vice $4.35 to $7.55 makes Maples the obvious choice.
Then again, I’m not really a “SHTF” kinda guy. Nothing against those who are but I just have a different mindset I guess. The changes and adjustments may come but I dont see the popular reaction as being what others predict it to be BUT that discussion is best had on another forum perhaps. I do see your point though on ASEs (Maples) vice bars. Thanks.
I understand that. I have an oregon trail 50c that is not getting sold either. Not nearly the premium that you have, but still a lot more than spot.
Mary Mary quite contrary is right about the value if the shtf, but that may or may not happen in my lifetime. I am prepared, but am also not going to hunker down waiting for it. I will have much bigger problems to worry about than the value of my few numismatic coins.
I’ve told others here, but i traded junk silver for proof dimes and proof franklins (and some proof 40% Ikes) ounce for ounce last time silver was high priced. Premium for the slightly collectible coins basically went to zero.
yepper, and like I just posted in another forum, most will recognize Roosy dimes or Wash quarters over Merc dimes or Standing Lib quarters…you have to remember who you would be dealing with in that type of scenario! Not always the smartest people and they have probably NEVER seen a Merc or Standing Lib…imho
Then I guess my question has come full circle. If, as you say, most have no idea then what difference does it make? Do you spent time explaining to people that a 1 oz bar has a certain value if, as people say, the SHTF, or do you spend the time explaining to people that the 25 cent piece from 1945 is actually worth more then 25 cents? In my mind it would be easier explaining (convincing someone) that the bar as an appropriate value but I’ve still been greatly enlightened by the answers I’ve gotten. Thanks to all.
I get the drift you are Canadian. We are all in this togeather. U.S. coins minted prior to 1965 are 90% Silver. I`m not sure of the content of Canadian coins, but I`ll assume you are. It is universally excepted that U.S. coins with no collector value, and a face value of $1.00 U.S. contains .715 oz Troy. So $1.40 face value contains 1 oz troy silver. It should be fairly easy to come up with an equivalant for Canadian coins. I feel a little dumb not knowing about Canadian coins, but it just hasn`t come up, I WILL LEARN.
I envy your NGC Morgan. I do keep a few muni`s around for theraputic value.
Canada was a bit later getting out of silver, ’68 is a confusing year, some 50%, some clad. ’67 and prior they were 80% silver. I have picked up some of the canadian proof like sets at auction at values well under spot because people just don’t know what they are. Picked up a cdn silver dollar at about 50% of spot price one time, auctioneer announced as a 50c coin, i bid up to what I wanted to pay and won… silver dollar.
coinflation.com is your friend.
Even more interesting is that Canada had silver nickels 1920 and prior, these were actually sterling, .925… but good luck finding those for spot or anywhere close. about $4-5 per coin is a decent deal.
@mikeyj80 , your April 4th comment helped clarify a concept I have, and I would like to bounce this one off the crowd here. Your feedback is welcome.
When spot prices are low, even if you like numismatic silver, it makes more sense to accumulate regular junk silver, because you can accumulate more weight (in silver) for your money.
When the spot price is higher, that is when it makes more sense to purchase numismatic coins (in addition to your regular purchases), because you will not be able to purchase as much weight for your money and the price difference between numis and regular junk is smaller.
I’m seeing prices for US silver dollars – Morgans and Peace – running consistently higher than for freshly minted new US Silver Eagles and Canadian Silver Maples. Considering that a silver dollar has at most. .77 ounce of silver in it, and the Maples one full ounce of .9999 fine silver, seems to me the best deal is the Maples. Second after that, the Silver Eagles at .999 pure silver.
I think the only correct answer is “it depends”.
All depends what your goal is, if just accumulating silver then it is hard to. know when it is low and high priced. Right now i would recommend selling the more common numismatic premiums. I have proof franklins that should bring $20-25 each. If I didn’t enjoy them so much I should sell them and buy the cheapest premium i could find, but i am not going to. i am selling my semi numismatic bullion, 3-5 year old koalas and britannias, etc. Getting $35 to $45 out of them and reaccumulating with lower mintage low premium stuff like the birds of prey series, libertads, takus, etc.
While it is hard to know when prices are high, you would be a fool (in my opinion) to not trade junk silver for premium silver at little to no markup. Your downside risk is only the spread that you paid. I.e. if you had a friend with premium stuff and the buyers are only paying spot price regardless of quality, trade him $5.10 of junk for $5 of premium. You give up a silver dime for premium coins, better, if he is a good friend he’ll go ounce for ounce with you as he likely doesn’t want to see the stuff melted anyways. Now you have no downside in premiums, only upside. I would argue you should consider trading bullion coins for premium silver as well for similar reasons.
My junk half dollars would maybe fetch $10 today whereas the premium coins fetch 2x that easy. Since i don’t have to sell it is just an accounting game, but clearly i am in a better position if i had to sell.
In full disclosure, was that a reverse proof PCGS 70 gold eagle? That is no where near the same as a “regular” gold eagle and the reverse proofs are the only ones that I have seen going for any where near that price…of course, that is still a good deal that I have also taken advantage of…over 2x melt
If you watch eBay, you can pick up the reverse proof MS69′s (even a 70 if the seller is panicking and trying to lock in the price) fairly cheap during a downturn and then sell them for quite a profit if/when the market turns.
Reverse Proof Gold Eagles were only minted in the 2006 20th anniversary set, total mintage a hair under 10,000 so they are somewhat “rare” for a newer minted coin but dang near half are MS70′s due to their newer mintage date and better quality control at the mint…which is why I typically trade the 69′s. I can buy them about 1.5x melt in down market and then sell them for near the 70 price in n up market.
I never even heard of a reverse proof gold eagle. Last year I bought one of the reverse proof buffalos, was going to flip it but never got around to it. The coin is still sitting in its unopened package as I received it from the US Mint. Will get around to flipping it one of these days…when I get around to it.
In short, coin club members(and they are around)are in it for numi value,and depending what you have, they just may pay through the nose for it. I never buy at these clubs, they want too much.
I think my 2014 Baseball HOF domed gold coins (non proof) they call them uncirculated may be worth a good bit. Congress authorized only 400,000 of these coins, wih the vast majority being proof gold and silver. I own (waiting on shipment) 5 uncirculated 1 oz troy domed gold coins, and damned if they didn`t get an airtight to fit these coins. There are $5.00 gold proof and uncirculated, $1.00 silver and half dollar silver both proof and uncirculated. The huckster on tv is selling the $1.oo silver coin for an unheard of amount. ANACS 70. I think ANACS is the Bart Chilton of the grading world, and don`t trust a thing they certifiy. I really enjoy making moves like this. Hell the hunt is most of the fun anyway.
Mikey is right on the money. THIS (after a hard fall of prices) is the time to sell anything that have accumulated additional % collectors value in your hands, and also the mis-purshases that failed to so. Sell and get more silver back.
You can choose to pick low-premium coins and rounds with potential to gain in % premium (compared to cheapest viable bullion option).
Since you’re in Canada, don’t miss out on the Peregrine Falcon coins. Should be ~$4 over spot, but being the first in a series, top favorite among the 2014 low-premium picks to do well.
Never give up the search for low premium Somali Elephants. I get mine cheaper than Falconw by 2-3%. And their track record is really well. I sold the 2012′s in the past months at substantial fiat mark-up, while silver is of course way down. A good 80% more silver bought back within 2 years. You can’t do that with 1000′s of ounces at a time, but I respect every ounce, so I don’t neglect the opportunity. Should hell freeze over and you never get your modest premium back out, at least for the money you’re not looking at another ugly silver eagle.
Be sure to own a neodymium magnet and learn how to use it to check silver. It’s not perfect but super convenient.
If you’re stacking silver to be used in the Mad-Maxx world of after TSHTF and society has melted down to the basics of survival, consider this:
I just got some more brand new 2014 Canadian Silver Maples today. Paid $23 and change, tax, shipping and all included per oz. Now compare these .9999 pure silver rounds to your 90% silver, .77-ounce silver dollars at the same $23 and change each.
Which is the better deal? One full ounce of pure silver – or only .77 ounce of silver mixed with copper? Gee, don’t take too long thinking on that one.
That worked for Muhammed, but that’s a different story. No kids for me either. About 7 years ago, I had a 25 year old girlfriend. Cute little blonde with perfect body. Too much to put up with for the long run. So keep the kids!
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