Here is a video I made about types of silver. I show some things I have acquired and talk about why I like some over others.
I wanna see where people agree/ disagree with me.
In general, there are these types:
Junk: its pretty much metal
Bullion:nicer than junk, carries premium for fineness or numismatics(slight). Still valued mostly as metal in most cases
Proofs: Numismatic. At this point, of course silver value may change the value, but because the premium is more than the total metal value, this not bullion IMHO. For example, Morgan dollars will be worth more if silver goes up, but buying an uncommon date at the same price as a proof silver round (I use this example in the video) would be pretty much the same. The value is based less on silver, though silver has to do with it. When the value is more is the numismatic than metal, it's not bullion to me.
In the video I talk about the thought patterns behind the different types of "stacking."
instead of saying proof it is better to differentiate between numismatic and seminumismatic coins in order to note their price difference.
example: somalian elephants, BU, worth north of $100 - so I consider them as seminumismatic because initially they were issued as bullion coins but rose in value substantially (the same as pandas)
numismatic: for example, somalian elephants proof - issued initially to catch coin collectors not metal stackers
Proof - is a technology of minting the coin, not the description of value.
Yes, I understand what proof means. I should have specified that proofs and expensive rounds go into the numismatic category.
I tend not to use "seminumismatic" though. I feel that an item is valued for either metal or collectibility. For example, a one oz silver round that is worth $100 is numismatic in my opinion, not semi. Even if its only worth $30, I would still consider that numismatic.
Why? Think about Morgan dollars.No one stacks them as "semi numismatic." They are worth about $15 melt value, yet common dates still go for $25-$30 indecent shape. About half the value is in its numismatic value, so if half and half there isn't seminude, why should silver rounds priced at double, triple, or five times + the amount of the metal value be different?
When I try to break down these terms, I'm not trying to split hairs with word meaning, but in the REASONS you invest. I used the word proof and made it confusing because I made it sound like all coins of that price were proofs. I didn't mean to be confusing, however, the REASON for investing at that lever is the same.
If you are buying a $50 coin with $20 of metal, you are making an investment in a collectible. Same if it's a $100/20 split, or even $20/20.
When you buy a common ASE, though, it's different. You buy the silver, with a premium based on purity and reliability. Personally, I like to save on that premium and buy junk silver coins mostly, but that's preference. I feel I get more for my money that way, plus I prefer old coins that are older than my grandparents even if they are common and worth melt.
Yet, my reason for stacking junk silver is the same as common ASEs.
My main goal of the post and video is to get people to think about WHY they choose one type over another and their thoughts on why they stack what they stack.
If you buy a coin at $24 and it becomes worth $100, but the metal value is still about the same, that is now no longer bullion. It is now numismatic IMO.
Here's why. I'm looking at the asset from an investment perspective. If someone wanted to buy it from you for $100, they are investing in the collectibility of it. We call that numismatics. If they wanted metal, they could have bought 4 rounds at that price.
From your standpoint, you invested in metal, but now its numismatic. Just like if my grandfather had stored away Morgan dollars for metal when they were taking silver out of coins. Lets say they happened to also be in decent shape. They would not be bullion today based on the REASON he kept them then, they would be numismatic today based on the REASON people BUY them now.
Sometimes you just get lucky and something becomes better than it was :)
That happened to me when I bought some zimbabwe 100 trillion dollar notes. Their value multiplied by 6 when they got popular :)
Values change, and therefor people's reasons to invest in the item also changes
Excellent presentation! I actually liked that you added jewelry to your stacking collection. I've recently branched out and begun doing something quite similar. When I started collecting in 2008, my goal was 1000 oz. of AG. After reaching it, I have to admit, coins began looking a little too much alike for my taste. I was collecting just for the sake of collecting, netting less joy in every purchase.
Jewelry was my outlet, which is strange since I don't wear any beyond a common wrist watch. I've collected rings, chains, spoons, bells, a Tiffany baby rattle, pendants, bracelets, a hair barrette, a 200+ years meat skewer, an Egyptian-themed money clip, reproduction art pieces, earrings, 3D trinkets (my new favorite collectible), Celtic brooch pins, bookmarks, snuff containers, and more, all in sterling or .950 silver.
Point being, the jewelry collecting possibilities seem endless right now. After knowing the value, usually to the dollar, of all the coins I collect, I quickly learned jewelry collecting was a whole new ball game. Although it's easy enough to figure the cost of the raw materials as far as metals go, I'm still trying to get a handle on the various values of semi-precious gems and such. And much like numismatic coinage, the prices of silver soar into the stratosphere when a well-known name (which I view as comparable to a rare date) is imprinted in the precious metal. Simply put, there's a lot to learn and probably a lot of money to be made, as well, not that making money was ever really my goal.
Part of my "bullion" holdings consists of sterling silver souvenir spoons. A tradition dating back to the late 19th century, these constitute an interesting class of collectible having documentary and aesthetic value that goes well beyond merely their precious metal content.
@Broseph: This thread is making me rethink the whole $100 for $100 series. What a sham.
Jewelry is only bullion if it's cheaply made or has shoddy workmanship. The way a coin gets spat out of the presses, that's bullion, nothing special about it.
@traevin: A gem is only worth what someone will pay for it. They're usually set into pieces to sell the gold around them. The prices on gems are made up depending how close you are to the mine that struck it, then add the labor to cut the stone and you have an approximate price. Usually they are sold by the carat, which can be hard to gauge when they are set in metal, but there are some guidelines like the dimensions will sometimes give you an approximate carat weight.
"Stacking" jewelry is a difficult game. You either have to get it at spot or know a multitude of respected makers and their trademarks. And then separate the real from the fake Tiffanys... I hope jewelry stackers aren't melting prestigious pieces.
Get to know your fortes. Everyone has their niche, for example, I like world silver coinage but I stay far far away from silverware/spoons.
I do get my jewelry at spot (or at least very close) because I don't know enough to pay extra for stone, craftsmanship, or antiquity. I just do it as a fun way to stack. I get some nice rings for my wife too :)
I had never heard of the $100 for $100. Is it legal tender? Can you really take it to a bank for a $100 bill? And is there shipping or other costs?
Sounds odd but intriguing. Also, like you said, seems like a sham. Selling $20 of metal for $100... Then again, it costs only 7.8 cents to make each 100 bill here in the US, so if I had to choose between a $100 bill and a $100 coin that at least had SOME amount of its worth in silver I'd want the silver. However, people MAY call the cops if you try and spend something like that :P
I have heard of cops being called for $2 bills! The scary part is when the cops think the $2 bills are fake too!
First its a nice video with all the coins, I like it.
What I dont like is IF one is buying for stacking right now is a bad waste of money right now. Until silver starts moving in some direction I have no interest.
As a collector, I like the fact that prices have come down as it has made all coins cheaper :D
Yes, yup, I have a very low stack right now. I sell more than I buy, but I still buy and end up keeping things I particularly like. For example, the barbers I got for $1.40 I'm definitely not selling in that price range! Way cooler to me :)
Basically, my collection is growing but my stack is somewhat small right now. This is mainly do to me just trying to be smart with my money since things are a bit tight.
The good thing about buying silver is when I buy, I buy low. If I buy ASEs at spot, I either make a profit or break even when my wife and I need to "break the piggy bank" that is my silver stack.
My stack, however small, provides financial security for us because instead of being a hobby that costs money, I either break even or profit.
as long as you are doing well,, thats the most important thing. I dont want anyone getting smoked by silver or gold.
I have no clue what happens here with prices. Out side of my job as a trader I do have opinions on the metals but I keep those locked away so as not to interfere with my job.
To me, whether they go up or down I will make money. But because I know the vast majority dont have this advantage, I just hope they do not tank and find some footing and stop going down at some point.
As a collector, I do like seeing prices tank and knowing where they are going to a degree because I been able to snatch coins and plug holes at the prices I want to pay. Yes, many times the prices drop even from where I bought, BUT I feel good because I am NOT buying at the top as I collect. So long as I can grab a discount, from a collecting stance, I am not bothered.
Well I was looking over my "hoard" of Numismatic/NCLTs/bullion semi numismatic coins and I think I now know what I have to do.... I think I will now only buy bars of silver/gold because I cant bring myself part with any of the rest lol. They look too nice.
I don't think I would get too attached to plain old bars....well maybe lol.
My attachedness to my hoard depends primarily on my fanatical standing. I can always replace anything I sell. Of course there are pieces I would never sell, but those pieces are terribly expensive anyway.
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Posted 05/21/2014 11:03 pm
