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 Replies: 14 / Views: 1,587 |
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Pillar of the Community
United States
1121 Posts |
Any insight on this would be appreciated! bear with me:
Alright spot silver prices have been down in the low 9's and even high 8's in the past few weeks. I have been doing a little selling of .999 silver bullion and it is bringing $18-$24. I understand that the Wall St price of spot is dramatically deflated due to mainly when the markets turned bad, people in general were selling ever stock they had, taking it out of the market and putting into safer investments (I was even at my bank one day and this little old lady wanted to withdrawal $100,000 from her savings and couldn't understand why this branch office said they could not give her more than $5,000 anyway..). Back to the point of silver deflation. Another thought crossed my mind is obviously no one wanted to sell their physical silver bullion at market levels. So here is my dilemma: If I am selling 1 ounce of silver bullion @ $18-$24 when the spot price is $9, keeping in mind the bullion has no numismatic value I only buy it for investments, doesn't it make sense to sell on such a high margin of profit if it is there? My Grandfather (who introduced me to this wonderful hobby of collecting and investing and who has been the owner and operator of very successful business for the last 56 yrs) is more concerned with buying to hoard for the long term. I agree slightly (I haven't tapped into my safety deposit box yet;), but would it not make sense to make the most profit margin when investing as possible? If silver does reach $18 spot again, I don't see being able to get a return of $36-$48 an ounce (based on the margins I am getting now)
Sorry to be so long winded, but any thoughts on this?
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Pillar of the Community
United States
1151 Posts |
The silver that you are selling now, cost you what when you bought it? Profit isn't the difference between spot and sell price, but purchase price and sell price.
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Bedrock of the Community
United States
10982 Posts |
My question would be what silver bullion are you selling at $18-$24 an ounce? Some Silver American Eagles have been trading at $18-$19 each but $24 for bullion? The MS Live Cashbask program on ebay is the only thing I can think of where you'd get that much. To answer the question: If you only have $11-$12 in these coins and can sell for $20 then buy more at reasonable prices, I'd do it. The people hoarding silver may have bought at the higher price levels earlier this year and are waiting for the next run up to over $20/ounce. |
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Pillar of the Community
 United States
1121 Posts |
I have a coin dealer who sells them to me at spot...and I have bought them from $9 to $10.30 an ounce. The types of rounds are made by various mints throughout the country. They are not ASE's. Though I have bought circulated ASE's at spot. |
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Bedrock of the Community
United States
10982 Posts |
Quote:
I have a coin dealer who sells them to me at spot...and I have bought them from $9 to $10.30 an ounce. If your coin dealer will sell you generic silver rounds at spot and you find people who will pay $18-$24 for them you'll be a millionaire soon. I'd buy as many as I could before he realizes people are buying these for $13-$14 as fast as they're made. I don't see any downside to what you've described if everything is on the "up and up". We're probably 18 months away from $20 spot silver so unless you want to wait a while, I'd take the $$ while you can. |
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Pillar of the Community
United States
1121 Posts |
The catch has been, he cleverly only has "available" 3 to 4 ounces every time I visit, knowing that I am prob going to purchase something else while I am there. Good marketing for him. Break even on the silver and make a nice margin on other coins, supplies, books, ect. It's ok. I really wasn't interested in retiring of the amount of silver that I intend on getting rid of. I was just looking for someone or some people who are knowledgeable in the commodities markets. My background is business and financing. Just seeking knowledge from people on this forum who have always been helpful in the past, for which I am grateful.
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Rest in Peace
United States
9104 Posts |
Anytime you can get double spot for bullion, and can buy near spot, sell.You can't lose money taking a profit.
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Pillar of the Community
Australia
3831 Posts |
Silver prices at 50usd/oz is totally unwarranted like how oil prices hit 150usd/barrel last year. Sure, investors and speculators can ALWAYS say it's scarce and valuable resources but it just doesn't bloody matter - if it's too expensive, people WILL back off from it. Yes, it CAN be possible to hit that high if speculators want to drive prices that high like how rhodium and oil did last year but it will fall.
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Valued Member
United States
188 Posts |
I think Silver is a great option as far as investments go right now. Not to get political, that is not my intent, but inflation is on the horizon!! If this stimulus bill passes we will have no other course of action in the next 5-10 years than to print more money. The more and more money the US borrow's from China the less the dollar will be worth and I think precious metals will be the safest bet for the near future. I'm not going overboard and cashing in my investments (Like a few people I know) but I've been dropping a couple hundred a month in silver instead of the mutual funds I normally invest in. Could the early 80's happen again?
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Pillar of the Community
United States
2130 Posts |
What happened in the early 80's dealing with PM's. I was born in the early 80's so I don't remember.
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Valued Member
United States
188 Posts |
There was massive inflation and Silver went through the roof, with the help of a few folks trying to corner the silver market. Bags upon bags of silver coins were sold to coin shops and sold to smelters in $1000 bags of junk silver.
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Pillar of the Community
United States
2600 Posts |
Silver worries me because:
Bunky Hunt won't be trying to corner the silver market again.
Silver has lost most of it's monetary value and is now a jewelry product and industrial metal.
One of silver's primary uses in the past was in film and that use is gone. Yes a lot of the silver was recaptured but was still a huge user of silver.
Gold and silver have been joined at the hip for years but that is starting to change.
Gold is much easier to hoard (store) than silver from a shear volume standpoint. Because of this, it is the bellwether for those protecting themselves from inflation.
If silver does ever break from gold and is priced on it's on merits, I don't think I want to be in the neighborhood.
If you are going to buy precious metals as security, why not put your money where the rest of the world does, gold, it has to be safer than silver.
Now if you are one of those conspiracy theorist, as I am, and believe that the price of gold is artificially controlled, I am not sure where to suggest you go to invest.
Jim
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Valued Member
United States
188 Posts |
I agree with everything you said Jim, especially the artificial control of Gold. Speculation is more and more driving the price of precious metals and thats Silver and Gold. Physical assets will always be the way that I go and I think they will always carry a premium. With the split of those who buy (my word) "internet gold and silver" and those who buy physical gold and silver there is a huge and ever increasing demand. The one question I have, with all these people buying "internet gold and silver" is it back by physical assets. If everyone asked for physical assets to be delivered would the company have enough to send them? An even better question since I've never bought that way, is that an option? That could cause a huge spike in price if everyone asked for their assets to be delivered.
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Valued Member
United States
79 Posts |
If I foud ASE at spot or just a little, I would buy |
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Valued Member
United States
462 Posts |
Silver excites me. Here are the general areas of use:
* Traditional
o Coinage
o Photography
o Silver Jewelry
o Silverware and Table Settings
* Industrial
o Batteries
o Bearings
o Brazing and Soldering
o Catalysts
o Electronics
* Emerging
o Medical Applications
o Mirrors & Coatings
o Solar Energy
o Water Purification
Although photography is a passing use, look at the future. Battery powered vehicles. Alternative Energy. Purifying water, especially desalination plants.
The use of a natural resource will change as time passes. Just because a past use of a natural resource fades doesn't mean the need for that natural resource will fade with it. All types of metal and metal alloys use has changed over time. The sword, spear and suit of armor has become the car, the metal fence and machinery.
Silver will fluctuate, supply and demand principles. A poor economy, a good economy, whatever, silver will always have some type of demand. Nearly 500,000,000 millions ounces of silver were used in 2008 for industrial purposes. And that was a bad year economically speaking.
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Replies: 14 / Views: 1,587 |
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Posted 11/26/2008 8:09 pm
