OT: Buying silver

[Larsen E. Whipsnade]

I recall awhile back there was a thread about buying gold. Gold in any significant quantity is out of my price range, but I've been thinking about buying some silver, mainly as an investment/inflation hedge, but also in the back of my mind is the small possibility of TEOFTWAWKI. Trouble is, I know nothing about it. I've been doing some reading on the 'net, butI tend to take things there with a grain of salt because most info you find was either put up by someone who wants to sell you something, or someone whose actual knowledge is unknown. So, if any of you have experience in this and can point me in the direction of a good source of either info or the actual commodity (physical silver, not stocks), I'd appreciate it.

One website I was looking at is this: https://online.kitco.com/bullion/completelist_USD.html (As I look into this further I'll compare other websites, but this was the first I came upon.) I notice that some of the foreign or non- govt. issue (commemorative) coins seem to be slightly cheaper for the same silver content (1 oz. .999 fine) than, say, the U.S. silver eagle. Is it wise to pay a slight premium for the U.S. coin? My gut feeling is that the coin having the reputation of the U.S. Govt. behind it might be easier to sell or barter if times got really hard. I don't know if it would make a difference just to sell on the spot market. (I'm not interested in something that may have or develop collector value, just for the actual silver content.) For the same reason, I'm thinking that coins would be better than , say, 1 oz. ingots. Then there's the question of buying pre-64 US coins. Although my understanding is that they're not pure silver, the % is constant (90%?) and the smaller denominations might be more useful in a dire situation. But I don't know if they're any better or worse from a pure investment standpoint. And as I said, these are just my gut feelings. I could be wrong - and often am. So if any of you have any expertise to share, I'd be grateful.

Larsen

[BigSky56]

Have no experience with gold but have a small amount of silver coin. IMO it would be better to purchase guns ammo and reloading components to use as barter a brick of 22 would be worth its weight in gold if the economy collapses. danny

[Cliff]

Look at buying what is called "Junk Silver" mostly american silver coins of known purity around 92 percent or so. You buy it by weight. There are dealers who deal in this stuff. Nice thing about it it does have a face value in addition to silver value. It is made up of old circulated silver dollars, half dollars, quarters and dimes, that don't have collector status. I don't know where to look or talk to but I am sure some searches on the net can find it. Something like 100 troy ounces to a bag. Poor mans gold was what a lot of people called it. Easier to move than gold and your sale value is pretty good. It has been years since I looked at it. The coins are U.S. money and IRRC you don't have to pay sales tax on money. Gold is taxed. Trying to sell gold is tricky, if it is not a monetary coin of known value and you will be lucky to get half the value when selling. If you want gold for barter or trading go with old gold wedding bands, usually 12 to 14 carat and gold buyers will pay accordingly. On bullion with gold you may have to pay an assay fee as high as 30 percent. There used to be a "Hard Times" book out back in late 1970's or early 1980's which covered a lot of this. Of course back then silver was around $5.00 per troy ounce .9999 pure. So I may be way out of date. If you can find it(maybe the Western Rifleshooter web site may have a link to the Back Pack Survivalist) this goes into metals somewhat. Be careful There is fake gold and silver stuff coming out of China being sold as collectable. Deal with reputable people and know your product. ATB

[adirondakjack]

Don't get caught up in the price per unit as a reason not to buy gold. Coins like the pre-1945 Mexican stuff are 90% pure gold, and some are very small, ie Dos Pesos (two peso) coins, etc. A few years ago I picked one up for scrap value (then about $15), and it's only worth like $65 today.... AAMOF last winter I cut it in half and made a revolver sight out of half of it. it's only money.....

As above, stick to coins and such with a KNOWN content. A watch case might be 18K or 10K, and markings not certain, etc. Big difference in value.....

[AJMD429]

IMO it would be better to purchase guns ammo and reloading components to use as barter a brick of 22 would be worth its weight in gold if the economy collapses. danny

Yep - .22 LR is pretty universal, and one round currently equates to about the same value as a nickle. Doubt value will go down much relative to either the dollar or to gold or to food, but it could go way up relative to all those things.

Still bulkier to store/carry than paper money or gold or silver, but about the same as current coins. More fragile though.

Ammo can be restricted as to where it can be carried, and could be banned, and so could gold, as has happened in the U.S. before. However, in a 'collapse' situation, it may be a moot point.

Too bad our socialist politicians and naive electorate have led us to the point where we have to brace ourselves for such a scenario.

[pwl44m]

Ur too late.Now is not the time to buy Gold or Silver for long term investment. Silver at nearly $50 and Gold $1500 aint gonna last.I want that crystal ball that tells Me the day before it crashes. I have verry little Gold and some Silver. Ur right about websites wanting to sell U something, they move lots of it and they move it fast.
Now don't take Me as final word as I'm sure there r some on here more knowledgable than I. That is just My Opinion.I'm waiting for those in the know to say it can't go any higher, then I'm selling what I have.
I think Danny's advice might be the ticket. I have spent a lot more on guns and related than Silver and Gold. Just bought another one today.
Good Luck in whatever U decide to do.

[adirondakjack]

Ur too late.Now is not the time to buy Gold or Silver for long term investment. Silver at nearly $50 and Gold $1500 aint gonna last.I want that crystal ball that tells Me the day before it crashes. I have verry little Gold and some Silver. Ur right about websites wanting to sell U something, they move lots of it and they move it fast.
Now don't take Me as final word as I'm sure there r some on here more knowledgable than I. That is just My Opinion.I'm waiting for those in the know to say it can't go any higher, then I'm selling what I have.
I think Danny's advice might be the ticket. I have spent a lot more on guns and related than Silver and Gold. Just bought another one today.
Good Luck in whatever U decide to do.

They said gold was peaking at $800/oz once. It did fall, but is back with a vengeance. The idea of precious metals is a " bunker" commodity you can stash, have little to no paper trail, and sell without getting taxes on it. (Ya can't do that with stocks, etc.)

FWIW I did NOT invest in guns or ammo at the start of the recession. Instead I bought Ruger and Ford stock..... Ruger has appreciated 135 % in 38 mos. Ford has tripled in 33 mos......

[Hobie]

IMO it would be better to purchase guns ammo and reloading components to use as barter a brick of 22 would be worth its weight in gold if the economy collapses. danny

Yep - .22 LR is pretty universal, and one round currently equates to about the same value as a nickle. Doubt value will go down much relative to either the dollar or to gold or to food, but it could go way up relative to all those things.

Still bulkier to store/carry than paper money or gold or silver, but about the same as current coins. More fragile though.

Ammo can be restricted as to where it can be carried, and could be banned, and so could gold, as has happened in the U.S. before. However, in a 'collapse' situation, it may be a moot point.

Too bad our socialist politicians and naive electorate have led us to the point where we have to brace ourselves for such a scenario.

There will always be a black market. For those who have never lived in such circumstances it might intimidate but it is a natural outgrowth of unreasonable government restrictions.

[Idahoser]

Cliff gave you the best advice so far, let me straighten up a few things for him:

'junk' silver is US dimes, quarters or halves made of 90% silver, 10% copper before 1965 that have been circulated and are not rare dates or mintmarks.

It is sold by face value, rather than weight. A dollar's worth of junk silver (no matter whether it's ten dimes, four quarters, two halves, or any mix) is considered to contain .715 troy ounces of silver. They were minted with more than that, but being circulated, there is an 'average' wear loss.

When you buy or sell junk silver, you figure out it's value by multiplying .715 by the current spot price (as I type this, that would be $45.31 for an ounce), times .715 troy ounces in a dollar's worth, so right now that makes $32.40 per dollar of face value coins. Divide that, then, to find a coin's value- divide by ten for a silver dime, $3.24. Divide in half for a half dollar, $16.20. Divide by four for a silver quarter, $8.10.

This rule has to be modified a little for the old Peace or Morgan silver dollars. They were made of the same 90% alloy but there's more metal there, .775 troy ounces. At this spot value, then, $45.31 x .775 = $35.12 per coin.

There are other coins that contain silver but the rules are a lot more complicated. Kennedy half dollars were first made during the very last year of 90% silver, 1964, so that's what those are made of. I presume that when silver was completely removed from the other coins, it was desired to 'honor' Mr. Kennedy in some way so they continued to use 40% in the halves until 1969. There are also some Eisenhower dollars that are 40%, only from a particular mint. These silver 'clad' coins are not worthless, but they're not straightforward, either, as pre-65 coins are.

I'm not buying as fast as I was when silver was at $9, but I am still buying. I don't see any change in the reasons for the apparent rise in metals (what's actually happening is not that silver, gold, gas, cotton, or macaroni and cheese are getting more valuable, what's actually happening is the dollar is getting less valuable. And the things that are causing that are certainly not getting better).

It's a way to actually accomplish what savings and investing do not- protect purchasing power for when you want to use it, later. For this reason, there is no price at which I would trade my real money for paper. $50, $100, $500, or $9, or $3... Two silver dimes will buy a gallon of gas or a loaf of bread, pretty much any time. You can't say that about paper money.

[19112TAP]

The price of gold and silver havn't really gone up its' the fact that the dollar has declined in value bringing the price up on the metals.

[Cliff]

Thanks for the corrections Idahoser. It has been quite a while since I looked at this stuff. I know if you weigh 10 dimes they weigh the same as a dollar, four quarters equal a dollar or 10 dimes, same difference with half dollars. I seem to remember a silver dollar, real or the new one with Ike on it was weighted at 13-16th's of an avudoupo(sp) ounce. When a service rep. serviced our postal scales way back when he would use a silver dollar to see how close it was. Of course a lot currency or coinage of the past works out the same just different names for them.
Anyway I will trot off and be quiet now. ATB

[dave in maine]

something else to keep in mind is that pennies minted before 82 are worth more in copper value than face and nickles are worth more than face in bullion you might look up apmex for current coin values

[Sixgun]

I take it this thread is for information on the smartness of investing in silver (or gold) when things go bad, either economically or well, you know, survival.

Like Danny and Perry say, there are better investments than silver (or even gold) when the &($@ hits the fan. People will be more interested in taking care of their stomachs and surviving. I personally think gold and silver are way over inflated. What do you think is gonna happen when "things get bad"? ........You think there's going to be corner stands where dealers exchange food for gold & silver?

The #1 item to have first are guns and ammo---and the will to use them. The average guy who was a "nice dude" before can easily (and will) turn into a monster if he has mouths to feed. This includes past friends and some relatives. (but NOT our dogs)

With guns & ammo, you can get food--the proper way or the "instinct way".

This gold and silver thing is purposely perpetrated by holders of large amounts of this stuff. Thats all you really have to do is look at the past catastrophies and see what people wanted--and needed.

This is the only gold I have and I paid $400 for it a few years back--not that many years back. see?

Go buy yourself a few thousand dollars worth of .22 ammo, shotgun ammo, common calibers of rifle/handgun ammo and...........................some MRE's -------------Sixgun

[Larsen E. Whipsnade]

Thanks to all who replied. Based on what some of you have said, and some more reading on the subject, I'm thinking the best way to go for my purposes is with "junk" silver - pre-'64 US coins. I realize I would've been better off buying it 12 or even 6 months ago, but according to the reading I've been doing, I don't think it's peaked yet. Supposedly, historically silver trades for about 1/16th the price of gold, so by that measure it should be over $90 an ounce. Of course, there's no guarantee - it could crash the day after I buy it. But hey, just getting out of bed in the morning is a gamble, too.

To those who suggested investing instead in firearms and ammo - already got that covered. If I tried to move all my ammo at once I'd break the springs in my pickup. Although I am kinda heavy on center fire rifle & pistol - wouldn't hurt to get some more .22's and 12 ga. birdshot. (Got a couple cases of 00 buck, good for intruders but not so hot for rabbits.) Anyway, I think some of you seized more heavily on the EOTWAWKI end of the scenario. I was MAINLY looking at an investment/inflation hedge. I was just thinking if I could do that in a way that would also work out well in a dire scenario, it would be the best way to go. By that I meant rampant inflation - the "wheelbarrow full of dollars for a loaf of bread" situation. Gold and silver would still have value in that case, or at least they have historically. Granted, in a complete breakdown of civilization, precious metals probably wouldn't be worth much. But I don't see the country falling into a tribal society short of a nuclear war - and I'm old enough and have enough health problems that I probably wouldn't last too long in that case anyway.

Thanks again to all who replied - I'm always amazed at the breadth of knowledge on this board. I bet if I asked how to build a DNA sequencer, someone would post the blueprints!

Larsen

[marlinman93]

Whatever you do don't buy gold or silver ingots in any size! Coined ounces or real coins are the only way to go. Ingots can be tampered with and when you take them back to cash in some day they'll always be harder to sell because they aren't minted.
I've got a couple 10 oz. silver ingots and the coin shop where I bought them is the only place that will take them without a hassle, and I have to have the receipt to take them there.
Speaking of receipts! Buy any gold or silver from real dealers who give receipts, and keep those receipts with it! Makes selling it later much easier!
PS-Now is a bad time to buy for investment purposes, as the prices are so inflated you'll sit on it a long time to even break even!

[Tycer]

If you do decide to buy for an inflation hedge or as a storage of wealth, look into " dollar cost averaging " your purchasing.

If the Bernank does decide to end QE2 at the end of June, there may be a fantastic pullback shortly thereafter in all stocks and commodities including precious metals. A great buying opportunity.

Don't spend your whole wad in one buy.

There are better places to buy than others.