As the title says Why buy junk silver? Why not buy pure silver? I can see the benefits of buying pure, but other than barter material where is the investment value in buying junk silver?
Have a look at 'junk' gold coins and at what 'premium' they are trading at. The Sovereigns, gold Roubles, Ducats, gold Coronas, gold Pesos, gold Eagles,etc, etc all of them are less than 0.999 pure gold and fetch at least SPOT for their AGW.
I think the other reasoning behind junk is that you are more likely to purchase below spot based on ASW or AGW from merchants that arent aware or arent considering the PM value. If we are talking purely survivalist, silverware and jewellery historically have also been good items to trade for food etc.
When silver is $200 an ounce, a coin with 1/10th an ounce of silver in it starts to make a whole lot more sense... doesn't it? Not to mention they're easily identifiable and durable. But if you want a simpler reason, look at the popularity of the Australian 1966 50c piece here on stackers. Post some for sale on the trade forum... I dare ya Okay, okay I jest. But if you love 999, why wouldn't you want a little bit of this? Scrumdiddlyumptious!
Sellers on Silverstackers are getting decent prices for their 50cents Sheeple are still getting stung by coin dealers for theirs. Was in a coin shop today when a lady came in asking about buyback prices on silver 50cents. She was offered $7.50 each; the store sells it for $10
Personally I dont buy less than 999 much at all. It's just that when I want to sell to sheeple in years to come, the average joe understands a term like "pure silver" compared to something like "0.800 silver". If you pay basically the same per gram of silver in a 999 or in a junk coin, I'd stick to the pure. Junk would want to offer me a discount in order for me to buy it.
When all the paper blows away, the tiniest, most dinged up, discoloured threepence will still be nice and spendable. And there's also something about such a coin that makes me smile... They just have a bit of character I guess.
I like 'junk' silver for reasons that they were actually used for 'money', unlike the Philharmonik or the Kook, Junk, if in relatively ok (VF+, XF , aUNC, etc ) condition, can be 'numismatically' positioned in the market. 0.999 coins are overpriced over spot, and im constantly on the look out for world silver coins on eBay, and wanna get them as close to spot as possible and sometimes lower. Its a precious metal which is being depleted. So if used industrially , the silver is there and purification process ( getting it back to 0.999) would be more feasable.
Funny, even bizarre, how a quite precisely alloyed and designed weight of silver is called junk. It gives pause for thought. Who was the evil miscreant who coined the term and what was their intent in so doing? Nobody would get away with calling a sov junk gold. Aussie predecimal until the final year of WW2 was stirling fine. Three round fifties makes a troy ounce. What's to complain about It's all good If silver ever has a monetary value again, then older circulated silver should be pretty liquid. Also, circulated items, at least in silver, seem to go at close to spot. Yes, as a holder, I have a slight bias. And yes, if more people buy fractional circulated silver, then scarcity drives the price higher. But the most compelling argument for owning it is the sheer thought of what would happen if a monster flock of sheeple went on a silver craze. I doubt any well known form of silver would escape.
999 is soft and marks and dings and wears and would be bad to use as currency.One oz pure would be to big for ordinary buys. Good only for coin collecters.
999 kook,etc,is soft and marks and dings and wears and would be bad to use as currency. One oz pure would be too big to buy ordinary things,bread,etc. Good only for coin collecters and eventually to be melted down. Can't really take them out of the case. Not really a coin. A coin can be used as a coin.
I am sure that in the event of currency collapse things would change, but I feel that until that happens 'junk' silver will never be understood by people as having investment potential - which would put make me uneasy if I was investing in it. I work for a large multi-national fast food chain and every day have to count a substantial amount of change. Every few months I will find a 1966 round 50cent piece used as de nominated - just goes to show how ignorant the masses are. But who am I to complain, that 50cents always 'disappears' on my shift. Meezzio
Also is an example of Gresham's law which is commonly stated: "Bad money drives out good", but is more accurately stated: "Bad money drives out good if their exchange rate is set by law." ( wikipedia) every one would rather keep the 1 oz of 0.999 pure and circulate the 1 oz 0.925 all other factors being equal. but when 15 sterling 1 ozers have the same PRICE as 13 0.999 coins . ( think about premiums for 66ers and kooks or ase's). I know which one id buy !
I think it is also less likely to be counterfeit. It is a known quantity as it was produced by the government mint - people know (or can find out very easily) it's metal content. When something has a 999 stamp - it is just that - a stamp. I know in a SHTF scenario - I would be getting that checked before I accepted it. malachii
Take two coins: Pure 1 oz 0.999 silver A heavier sterling 0.925 silver coin that contains 1 oz of pure silver. Which one would you go for? I'd go for the second every time, since you get a few grams of free copper, and a more durable coin to boot. Thats why I love sovereigns and krugerrands.
You do get copper, but at current levels, i think purifying the silver would cost more than copper retrieved.
Although in that scenario, the durability is probably more important that the purity. Its one of the reasons I think a 995 cobalt hardened gold coin would be a good idea. Still counts as bullion, so no GST, but doesn't need encapsulation to stay in reasonable condition. If the mint is going to add to its range, might as well be in something differentiated from what they have.
