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 Replies: 12 / Views: 1,635 |
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Pillar of the Community
United States
4870 Posts |
So what justifies the $3.50+ per coin premium on current silver eagles? Current spot is $14.44 and JM Bullion is selling them for $18.02 each. Paying $18.02 for an ounce of silver bullion seems uneconomical when it's spotting for $14.44/oz. Better off buying maples, philharmonics, and krugerrands at a lower premium. Edited by TheForce
09/24/2018 11:23 am
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Pillar of the Community
United States
509 Posts |
Just out of curiosity, why would you expect they would sell them for spot? They are in business to make money.
Edited by jst1dreamr
09/24/2018 1:09 pm
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Pillar of the Community
United States
2023 Posts |
Perhaps silver eagles have a higher perceived numismatic value? Without numismatic value, they're all effectively bullion rounds. (And yes, there is the profit motive behind any kind of premium.)
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Pillar of the Community
 United States
4870 Posts |
I guess this is where it gets dicey...bullion pricing and numismatic pricing. I kinda wish they were separated as not to inflate the price for a bullion coin.
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Bedrock of the Community
13014 Posts |
The US mint sells them at $1 over spot to the authorized distributors. They then have to make a profit and sell it to other sellers as well. Its easy to see where the 3 dollar or so standard premium comes from and not all silver is equal
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Bedrock of the Community
United States
11951 Posts |
Not everyone can buy bullion eagles from the mint. You have to be a
high volume, bonded bullion dealer. They pay more than spot.
Those dealers might be buying Eagle's by the pallet. Then they will try to
sell them to the next level dealer, by the monster box. Those dealers then
might break open the monster box and sell by the roll or single coins.
Most of the time before the average buyer buys his Eagles there have been
three or four dealers that have had them and expect to make some profit.
This is how it has always been with eagles. In 1986 when they came out
silver was between $3.00 to $4.00 per oz. and the new silver eagles were
selling for $7.00 each.
As mention above, dealers have to make some profit to stay in business.
The dealers that are selling them for $3.50 over spot, did not pay spot for the coins.
All silver has a buy and sell price, spot is just a start point.
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Pillar of the Community
United States
4870 Posts |
I can see the rationale behind these premiums...they are passed along to the consumer. Basically your stash has to increase in value to overcome the premiums you paid to come out ahead. And that might be a long time if ever. I guess it's kinda sad we can buy foreign bullion for a smaller premium than the bullion from the country we live in.
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Pillar of the Community
United States
3184 Posts |
I just sold 40+ eagles for 16 each because I wanted to get some rare thai coins........not everyone will tack on such a giant premium!
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Pillar of the Community
United States
4870 Posts |
For other bullion coins like Krugerrands and Maples, I've been getting them for $100 and some change for 6 of them. The ASE's are not sold at that price from the dealers online. Nice to know some private sellers have better deals. |
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Pillar of the Community
Canada
5248 Posts |
If you want freshly minted eagles in bulk, you are stuck with the premium.
If you just want silver, there are plenty of sources to buy it at spot.
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Moderator
 Australia
16850 Posts |
There will always be a premium for legal tender coins over other forms of bullion. You're basically paying a voluntary tax to the government that issued the coin, in exchange for owning a piece of silver that is government-certified as to its weight and purity (as opposed to being "certified" by some random private company who might or might not be telling the truth).
Some countries charge a higher tax for this service than others. America has high premiums, compared to Canada.
If you don't want to pay the tax, and are happy to take the chance that the private corporations making bullion rounds and ingots are unlikely to be lying to you, then buy the cheaper bullion.
Don't say "infinitely" when you mean "very"; otherwise, you'll have no word left when you want to talk about something really infinite. - C. S. Lewis
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Pillar of the Community
 Canada
665 Posts |
If your goal is to invest in Silver (growth, hedge whatever), purchase it with as little premium as possible. That is usually high weight bars (1000 oz or 100oz). Failing that, there are many 10oz bar out there. Coins will always have a perceived numismatic value... Just look at the bullion ATB series, especially older ones. Maples and Philharmonics have lower numismatic value because they are massive issue quantities and generally available. Look at the Canadian Mint Superman issue... it is climbing in value due to the fact it is no longer as readily available. And while we are at it...what is with Australian Swans... What is important here is your goal... If it is coin collecting using bullion media... expect to pay a variable amount over spot... to the point of NCLT pricing or worse. If your goal is silver investing/hedging... then 10oz+ bars. |
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Pillar of the Community
United States
4870 Posts |
Right now, JM Bullion has random year Austrian Philharmonics for $1.35 over spot. Heck of a lot better than $3.50+ over spot for ASE! |
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Replies: 12 / Views: 1,635 |
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Posted 09/24/2018 1:58 pm
