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 Replies: 21 / Views: 4,800 |
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Pillar of the Community
Canada
2845 Posts |
You think dealers could profit by selling silver coins for less than bullion, as opposed to melt? The result would be to devalue ALL silver, whether collectable or otherwise. I am not privy to any arrangements but typically any high volume results in better pricing, the return for dealers in selling large quantities of silver bullion for melt would be far greater than what's quoted to the average private collector of silver coins. That uncollectable, undesirable and unwanted coins, inventory not turning over, is routinely melted especially when silver prices peak from time to time is beyond debate. It's also possible that RCM's NCLT recommended dealers have a mutually beneficial arrangement in place that includes suppling RCM with bullion to that regard, which then serves as a source for future NCLT production. Edited by wildflowerAB
04/12/2016 5:44 pm
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Valued Member
Canada
147 Posts |
In our case, it comes down to supply simply outweighing demand. Every few months, we'll get large whacks of 76 Olympics, but nobody buys them. They'd rather buy the circulation silver or Silver Maples.
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New Member
 Canada
24 Posts |
WildflowerAB Quote:
You think dealers could profit by selling silver coins for less than bullion, as opposed to melt? Yes. Quite simply if melt yields a dealer 97% of the value of the contained silver, that dealer would be 2% better off by selling those coins for 99% of the value of the contained silver. Quote:
The result would be to devalue ALL silver, whether collectable or otherwise. No. Only the "uncollectable, undesirable and unwanted coins" would be subject to such discounting and in your own words they've already been very clearly devalued. Quote:
That uncollectable, undesirable and unwanted coins, inventory not turning over, is routinely melted especially when silver prices peak from time to time is beyond debate. No, that is the debate. I'm assuming that any dealer is rational and will act to maximize his sales proceeds on his coins.  Edited by Hepcat
04/13/2016 2:10 pm
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New Member
Canada
24 Posts |
Universalcoins: Quote:
In our case, it comes down to supply simply outweighing demand. Every few months, we'll get large whacks of 76 Olympics, but nobody buys them. They'd rather buy the circulation silver or Silver Maples. Nobody buys them? Your price then is probably too high. Are you pricing them at a discount to Silver Maples and circulation silver? At no premium or even a very slight discount to silver? I'd certainly buy the 1976 Olympics if the price was right, and I really don't understand why other silver coin buyers would not. Price is the great equalizing factor in such cases. Edited by Hepcat
04/14/2016 1:16 pm
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Pillar of the Community
United States
814 Posts |
What about the US Bicentennial 3-coin silver sets? Weren't there so many made that they were available well into the 1980s before the unsold ones were melted?
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Pillar of the Community
Canada
2845 Posts |
Hepcat, when dealers price unpopular silver coins at spot price, no premium for collector value, intrinsic value only, that's a fair and reasonable price whether you like it or not. That you might expect a further discount and present it as you're doing a favour to the shopkeeper, when really it's you who's looking to benefit.....well, I can understand why that strategy may not work well for you. Quote:
Yes. Quite simply if melt yields a dealer 97% of the value of the contained silver, that dealer would be 2% better off by selling those coins for 99% of the value of the contained silver. Considering the spot price of silver is presently appx Cdn $20/oz and 99% of $20 is $19.80....... if only 20c per ounce is a deal breaker for you, I'd then wonder if you have a clear understanding the volatility that perpetuates bullion markets, both on the short and longterm. Furthermore business can deduct certain certain eligible expenses in accordance with CRA guidelines. While you assume it's cheaper for them to sell to you at a discount as opposed to incur the cost of melt, that may not be true at all. Furthermore, it's unreasonable for you to expect business owners to prove why your theory might be wrong, particularly if you insinuate that you possess the ability to better manage their business pricing than them, simply because you're seeking to benefit. Edited by wildflowerAB
04/14/2016 2:24 pm
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Pillar of the Community
Canada
3733 Posts |
i can tell you first hand, dealers buy these olympic coins well under spot price,if they can't sell the for spot then they send them to melt..why? because they have margin on them, they aren't losing anything on them.. unless they sit on them too long and spot price tumbles, I have personally been there when they were busting them out of the cases and throwing them in a bucket..and why again? because they know in short time more will be rolling in..
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New Member
Canada
24 Posts |
WildflowerAB: Quote:
Hepcat, when dealers price unpopular silver coins at spot price, no premium for collector value, intrinsic value only, that's a fair and reasonable price.... I agree. Quote:
... whether you like it or not. I never implied that I wouldn't/didn't. Quote:
That you might expect a further discount and present it as you're doing a favour to the shopkeeper, when really it's you who's looking to benefit.....well, I can understand why that strategy may not work well for you.
Considering the spot price of silver is presently appx Cdn $20/oz and 99% of $20 is $19.80....... if only 20c per ounce is a deal breaker for you, I'd then wonder if you have a clear understanding the volatility that perpetuates bullion markets, both on the short and longterm. You're assuming far too much, both that I might have been trying to bargain with dealers to get a further discount (I'm actually more of the shrug and walk away type of buyer), and that I don't understand how volatile precious metal prices can be. I do. In fact I understand that growth in precious metal prices can't be assumed. The only assumption that can be made is that they will fluctuate. My own assumptions on the other hand are very basic. They are such: 1. Dealers are profit maximizers. 2. Junk silver coins turn over fairly quickly at most often a slight premium to the price of silver, and if they're not turning over fairly quickly at a slight premium then a reduction in the price to a slight discount will accomplish the quick turnover. 3. Unpopular collector coins can be mixed in with junk silver. Buyers won't complain. 4. Sending silver coins for melt will realize only a rather noticeable discount to the price of silver, perhaps as much as 10%. Why therefore would a dealer melt Olympic silver coins as opposed to selling them to customers as junk silver? A small sign in the window "Olympic silver coins at spot!" would do the trick. If not "Olympic coins at 98% of spot!" will . Edited by Hepcat
04/20/2016 3:49 pm
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New Member
Canada
24 Posts |
Silverwolf: Quote:
...I have personally been there when they were busting them out of the cases and throwing them in a bucket. Did you then offer to take any off the dealer's hands for more than he was about to get at the refinery? What was the dealer's response? |
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Pillar of the Community
Canada
1747 Posts |
ok, I think the OP was not intending this to spiral down a rabit hole. I think silverwolf, you may have painted a wrong color picture on what hepcat was saying. I believe his intention was to say that he would expect the dealer to LOWER his premium (over spot) not specifically discount the coins lower than spot.
I would suggest that this would be a smart business idea, if the owner needed to move product.
However Hepcat, please be conscious that business owners keep the doors open with said profit.
Please lets move on from this debate.
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Pillar of the Community
 Canada
2360 Posts |
Back to the topic at hand;
The 2012 Year of the Dragon 1/2 ounce Silver Coin is always available at a discount.
Mintage 588,888 so high, near the mintages of the Silver Dollars of the 1970's.
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Pillar of the Community
Canada
9868 Posts |
The title says it all.
Most collector coins are overproduced.
"Dipping" is not considered cleaning...
-from PCGS website
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Pillar of the Community
United States
2408 Posts |
Well, there are two sides of a coin (until the mint decides to strike a ball, a cube or something else). One side is "Mintage" and the other is "Price".
There's an optimum balance which is gauged differently by collectors, flippers, investors, etc. Depending on where you stand, "overproducing" may not mean anything.
That said, Montreal Olympic coins were the ultimate overproduced coins - ever, IMO.
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Pillar of the Community
United States
4233 Posts |
My personal favorite was the 1971-S Eisenhower proof dollar. Your said "or the US", right? Quote:In the fall of 1971 collectors eagerly anticipated delivery of their silver-clad Proof Eisenhower dollars from the US Mint. Each buyer had paid a whopping $10 per coin, a figure that was quite controversial at the time and is hard to translate into 2013 dollars. Even so, the Mint sold more than four million of the 1971-S silver-clad Proofs, and recipients were pleased with both the coins and their attractive packaging. That $10 figure was indeed "quite controversial" with my parents, but my brother and I each spent our lawn-mowing money and got one. For inflation reference, we got $5 to mow an acre lawn back then. Today, you can still get a 1971 Ike brown-box on ebay for $10. |
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Pillar of the Community
United States
2408 Posts |
Quote:Today, you can still get a 1971 Ike brown-box on ebay for $10. That's hard to swallow... considering that $10 in 1971 represents $58 in buying power today... |
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Posted 04/12/2016 9:50 pm
