Silver and gold are exceptionally useful elements. Especially silver! It has many unique properties that make it an invaluable resource, and yet we are consuming the world’s supply of silver at a shocking rate. Pure silver is the best conductor of heat and electricity of all known metals. Silver is also the best reflector of visible light known. Silver’s beauty is utilized in lots of ways. The range of uses for silver is exceptionally broad and many countries around the world use silver in various manufacturing functions.
As a precious metal, it has been a source of human adornment since the beginning of time. As the principal component of fine tableware, appropriately called ‘silverware’, it has served an important utility for hundreds of years. As a light-sensitive element, it is used in photography and photo- imaging. Silver is even used in medical applications!
Silver’s corrosion resistance, malleability, ductility, reflectivity and conductivity are opening up new uses for silver all the time. All of these reasons have kept silver in high demand by people since the beginning of time. Problem is, silver is finite and the world is running out of it.
You cannot make more silver, although we can turn other elements into silver with a process called atomic transmutation, using particle accelerators. Similar to just how it sounds, this process is very expensive and currently far exceeds the cost of silver. There are constantly new uses for silver coming to light all of the time, so it isn’t confusing to see that the availability of silver will undoubtedly continue to dwindle. It is obvious you should buy up silver, and gold if you can afford it, as much as you can!
WHAT TYPE OF GOLD AND SILVER SHOULD I BUY?
Silver Coins. My main suggestion on the type of bullion you should buy, are silver coins or rounds. For example, the Silver American Eagles and Canadian Maple Leaf coins. These coins are common, highly recognizable, composed of .999 fine or better silver, and are not prone to high premiums like rare uncirculated early US silver coins. These
coins do generally carry a $3 to $5 premium per ounce, but the free market has determined the benefits of these coins are worth this small premium. These coins are accepted world-wide as silver bullion, and undoubtedly will be a great transaction currency for trade if needed.
Government- minted coins are more easily proven as genuine compared to bars. Bars are formed from melting down precious metals and as such, are more available for counterfeiting. On the market, we have seen many occurrences where bars were faked by melting down less quality materials and posing them as the real thing. Coins minted by governments like the American silver eagles and Canadian maple leaf coins are also legal tender, at $1 USD and $5 CAD respectively. These are harder to fake and serve as a great monetary piece in a variety of situations.
Pre-1964 US 90% Silver Coins
“Junk silver” is an informal term for any silver coin that has no numismatic or collectible value above the intrinsic bullion value of the silver it contains. The term “junk silver” usually refers to US quarters, dimes, dollar and half-dollar coins minted prior to 1964. These coins are made of 90% silver, mixed with 10% copper, typically. Junk silver can usually be found with little to no premium, and have the added upside potential that some years or mintage of coins are or will become rare and more valuable than their silver content alone.
Bars. Bullion bars made of .999 Fine Silver are a great way to own silver at little to no premium. Solid bullion silver bars of .999 fine purity are a great way to buy silver. I recommend you buy 10 oz Silver Bars that are clearly marked for purity and weight, and are from a well-known dealer. Never buy silver-plated bars. 1 oz. Bars and rounds are not bad either, as the smaller volume might prove beneficial in a trade transaction, if the need arises. Some examples of well-known silver bar producers are Engelhard, Johnson and Matthey, Heraeus, Sunshine Mint and Apmex. Bullion bars generally carry the smallest premium of any form of physical silver, when you go to buy them from a dealer.
Silver Rounds. As I mentioned, silver rounds are a great form of bullion to purchase as well. If you are just getting into silver or gold buying. Silver rounds are generally sold with low premiums over the spot value. These are not considered coins, because they are privately minted instead of government-made. So they are not legal tender in a dollar value. You want to purchase .999 silver 1 oz Silver Rounds that are clearly marked for weight and purity and come from well-known mints.
Keep a Variety. You may find that a mix of generic rounds, government coins, bullion bars, and junk silver to be ideal. This will give you a wide range of use when it comes to bullion related transactions. Avoid buying commemorative coins, decorative items, and other collectibles, all of which carry large premiums and are very limited in the marketplace when being sold.
HOW TO AVOID BUYING FAKE PRECIOUS METALS
Do not buy silver plated products. Auction sites like eBay are FULL of bars that are composed of mainly copper and plated with only a minimal amount of silver. You only want to buy solid 99.9% pure silver bars. They should be clearly labeled with the weight and level of purity. Sellers of some bars try to trick you with wordplay. Do not buy things label, “mils, 10 mils, 100 mils, etc., they are worthless bars of copper. The “mils” part of this product is your major red flag.
Never buy silver from Chinese and non- certified sellers on eBay. When you are shopping for silver on eBay, you should avoid buying from sellers in China. It is not Chinese people, but the location and laws that govern coin production in that area are limited at best. With over a bullion people there, it is not confusing that despite avid efforts, the Chinese government has a difficult time stopping counterfeiters within their borders. That being said, a TON of fakes come out of China. Sites like eBay do not have a level of control capable of stopping counterfeiters. It is too easy to create phony accounts and sell fake items, so counterfeiters flood to this type of site, Amazon included.
Invest in a digital scale and find a good information source. Use my website, VarietyErrors.com or other trusted source with information
about the weight and thickness of the silver coins, and verify the coins you are buying.
Do not buy “German silver” or “Nickel-silver” bars. Beware of sellers on eBay selling bars of “.999 Fine German silver” trying to mislead potential buyers into thinking they are buying pure silver bars. German silver is another name for nickel silver, a copper alloy with nickel and often zinc, and contain no silver. Do not buy these bars!
WHEN SHOULD I SELL MY SILVER?
People understandably want a hard dollar figure for the price of silver as their target to sell. Well, the problem is the United States dollar keeps being devalued and the supply inflated, and the available above-ground silver reserves are getting smaller and smaller. So, this is the problem when it comes to putting a specific dollar amount on when to sell your bullion. I would suggest relating the point of selling your silver or gold with real world assets, rather than dollar amounts. The government of China is heavily encouraging its citizens to buy physical silver. There will come a time when silver is overvalued, but it will not be time to sell your silver for dollars to hold. In this case, I would suggest considering the weight of your precious metals reserves against real world, tangible assets like real estate.