When did milkspotting become a problem?

S

SteveS

Member
I get the impression from discussions in here that milkspotting of coins is a growing problem. Is that true? Does milkspotting affect newer coins more than old and, if so, is there a date before which milkspotting wasn't a significant problem?

Because I am now unlikely to add much to my small stack, I feel inclined to weight my purchases more toward aesthetic values, hence an interest in coins (not collectible numismatics).
 
Welcome to the world of silver. No matter you get, you'll always have this worry. Unfortunately. The only pieces I've never seen spot, but I'm sure they do are the Morgan dollars (?). Okay some claim that the collectible Canandian stuff doesn't spot. Who knows. But I'd say pretty much anything can spot, unfortunately. If you're looking at rounds or generic govt issued coins like Eagles, Maples, Philharmonics, Roos...who cares, it really is bullion, and you are playing the price of spot. But if you stack semi-Numi coins, which I consider the beast to be, along with the Perth Stuff, China Pandas, etc...and they develop spots, kiss your $4-8 premium good bye. Unfortunately.
 
Most say that the spots started to get more prevalent when mints moved away from mechanical polishing to chemical washing of the planchets.
Honestly I reckon the only time you need to be bothered by it is when it happens to numismatic coins. Bullion is always bullion no mater a few spots or tarnish.
 
Currawong said:
Most say that the spots started to get more prevalent when mints moved away from mechanical polishing to chemical washing of the planchets.
Honestly I reckon the only time you need to be bothered by it is when it happens to numismatic coins. Bullion is always bullion no mater a few spots or tarnish.
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So there are only two types of coin - high premium nums and basically raw silver?

My purchases have mostly been Kangas, for which I don't expect to receive a resale premium, but I also have a few PM Lunars and some RM Beasts. It is only the latter two that I care about in terms of condition, though I know they are not 'collectibles' and still won't be when I sell them in ten years or so (if I sell them at all).
 
SteveS said:
I get the impression from discussions in here that milkspotting of coins is a growing problem. Is that true? Does milkspotting affect newer coins more than old and, if so, is there a date before which milkspotting wasn't a significant problem?

Because I am now unlikely to add much to my small stack, I feel inclined to weight my purchases more toward aesthetic values, hence an interest in coins (not collectible numismatics).
Click to expand...


What precisely do you mean "aesthetic values"?

Milkspotting is a modern planchet production phenomenon. It is apparently the result of a cleaning bath residue that doesn't get completely washed off a planchet before that residue gets baked onto the surface of the planchet / coin in a consequent step.




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SteveS said:
Currawong said:
Most say that the spots started to get more prevalent when mints moved away from mechanical polishing to chemical washing of the planchets.
Honestly I reckon the only time you need to be bothered by it is when it happens to numismatic coins. Bullion is always bullion no mater a few spots or tarnish.
Click to expand...

So there are only two types of coin - high premium nums and basically raw silver?

My purchases have mostly been Kangas, for which I don't expect to receive a resale premium, but I also have a few PM Lunars and some RM Beasts. It is only the latter two that I care about in terms of condition, though I know they are not 'collectibles' and still won't be when I sell them in ten years or so (if I sell them at all).
Click to expand...



Well, depends on who you ask.


I don't see two categories but several and not everyone will agree which product falls into which category.


As just one example, 1986 bullion ASE's can gain some decent to extraordinary numismatic premiums depending on the condition. So how does one categorize bu ASE's??? There's no single satisfactory way in my opinion.


As barsenault writes, if you are buying raw bullion like 2016 kangas, ASE's, CML's, Brtannias, and similar mass produced bullion coins, there's really very little reason to be concerned by milk spotting or the condition. These coins are produced by the millions (some by the tens of millions) and when they are bought and sold raw, I see them all as a spot play....which means I won't pay any collector premium on these cons at all.



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mmissinglink said:
......As barsenault writes, if you are buying raw bullion like 2016 kangas, ASE's, CML's, Brtannias, and similar mass produced bullion coins, there's really very little reason to be concerned by milk spotting or the condition. These coins are produced by the millions (some by the tens of millions) and when they are bought and sold raw, I see them all as a spot play....which means I won't pay any collector premium on these cons at all..
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But isn't it impossible to buy even Kangas etc without paying a premium, or am I misunderstanding what is meant by 'premium'?

With silver at AUD25, kangas sell for around AUD31. Is that 24% markup NOT the premium everybody talks about, or does premium means something above and beyond a reasonable markup? At what point do we start to call the markup a 'premium'?

Another example is the PM Lunars. I think I paid AUD115 or so for one of those, new (1oz). I suppose the extra 'markup' is due to there being limited numbers available, but the Lunars are still not considered collectible numismatics, are they? Is that what are called 'semi numismatics'?

Apologies for the newbie questions.
 
Premium behaves differently according to the item you are referencing.

I think the easiest way to think about how premium behaves is like value of new to used cars, and niche art pieces.

$1m Ferrari brand new 2016 plates, with 1km on the odometer in 2020 might still be worth $1m, $2m or $800k it depends on demand. In 2120 it might be worth $5m or $1m as collectors prices.

$20k Hyundai brand new in 2016, with 1km on the odometer in 2020 will not be worth $20k, maybe $18k or 13k, even with only 1km we can confidently guess it will be worth less. But this same Hyundai with 1k in 2120 might be worth $5m who knows, if it is the last one and mint.

Both are cars and silver terms if both cars weighed the same would be worth spot.

if you are looking at premiums, you are not strictly looking at it as investment, you are looking it at it as hobbyist or collectors.

A good example is some home poured 1oz bars selling near two times spot. That bar (great for the seller and good luck for the buyer) is only worth 1oz silver and even to vast majority of silver buyers not on SS forum it is only worth spot.

I bought box of rolls when I started, since than never bought a roll of anything, as I looked at my exit price and that was at ONLY spot and the premium is gone.
One box I might sell it here to keep premium, but say in 20year I had a 50 boxes, I wouldn't be bothered selling a roll or capsule at a time.
 
SteveS said:
mmissinglink said:
......As barsenault writes, if you are buying raw bullion like 2016 kangas, ASE's, CML's, Brtannias, and similar mass produced bullion coins, there's really very little reason to be concerned by milk spotting or the condition. These coins are produced by the millions (some by the tens of millions) and when they are bought and sold raw, I see them all as a spot play....which means I won't pay any collector premium on these cons at all..
Click to expand...

But isn't it impossible to buy even Kangas etc without paying a premium, or am I misunderstanding what is meant by 'premium'?

With silver at AUD25, kangas sell for around AUD31. Is that 24% markup NOT the premium everybody talks about, or does premium means something above and beyond a reasonable markup? At what point do we start to call the markup a 'premium'?

Another example is the PM Lunars. I think I paid AUD115 or so for one of those, new (1oz). I suppose the extra 'markup' is due to there being limited numbers available, but the Lunars are still not considered collectible numismatics, are they? Is that what are called 'semi numismatics'?

Apologies for the newbie questions.
Click to expand...

This is a good question that never seems to get a proper answer here because everyone looks at coins in different ways to suit their interpretation!

All mark up on bullion coins is premium on silver price and the premium can be much higher with single or small purchases of bullion coins.

To me secondary premium is what a re seller charges because they believe that is what the bullion coin is worth now due to market demand/collector demand/possible future gains and the buyer goes along with it or not.

To those that buy ASE,s in monster boxes or huge quantities ASE,s have a very small premium close to spot and all ASE,s will always be worth just above spot but to those who buy one or two only to collect the premium is much higher same for all bullion coins even the kanga, try getting those who profess ase,s or kangas are only wort just above spot to sell you a few just above spot to see their true value to the holder.

If only certain modern bullion coins had a higher premium with all others being classed as melt or buyback then why do so many investors of such forever low premium silver coins not just buy even lower premium silver bars? buying bullion coins for there melt value make no sense unless they cost the same initial premium as silver bars.

Silver bullion coins are only ever worth silver buyback price unless you collect them or another is willing to buy them above silver buyback price. I am pretty sure there was a thread where a member took his high premium modern bullion coins to a well known dealer who sells those same coins at different high premiums depending on market demand and found that the dealer would only pay the same small premium on all the coins regardless the dealers own scale of selling premium added to their own bullion coins for sale.

I purchased early silver proof kooks at a similar price to early silver bullion kooks and early specimen kooks cheaper than bullion kooks which means the secondary premium on bullion kooks is over inflated by the sellers because the collector is willing to pay that inflated premium not because they are worth that inflated premium.

Although some buy silver bullion coins because of there face value so they can always be used as a trade coin if the modern monetary system breaks down,this is why Maples are so popular as they have a $5 face value and ASE,s because america had silver dollars before paper money,it would be unrealistic to collect the likes of sovereigns as the one pound face value it is. :)
 
Right on. Here is my philosophy on why I buy what I call semi-numi coins. And I only buy rolls with Perth Mint wrap. There are 3 key reasons for me to buy Perth Kooks & Lunars (and only those with the least amount of premium). 1. Limited Mintage 2. Year Design Change 3. Cost. That's it. For example, when the Kooks 1st come out, they are priced around the same as the Eagles (roughly). Eagles closely follow silver spot price. Kooks do increase in price (premium) over time, due to the 1st two reasons above. Look at the sale prices of the early year kooks that Fishtaco mentions above. I'm not sure how much he paid for those bullion coins back then, but I can't imagine they were that expensive (??). Those prices have remained stable (some around 35-50 - eBay sales), even with spot price tanking from a high of 49 all the way down to below 14. Whereas that same person who bought Eagles back when Fishtaco did (okay minus the 1 worth 10k, or whatever), saw their Eagles go to 49, and follow spot all the way back down to 13 and change, plus some some premium. The key of course is to buy the Perth coins for about the same price as the Eagles. Then you have a pretty big score as you hold and then go to sell down the road (no, not a quick flip).

You may be asking, why only the Perth Mint Wrap coins (1/2, 2, and 5 oz)? Good question. Because Perth has been known to spot lately, and I figure when I go to sell my rolls, they may be ladened with spots, but who knows, right? Lol. It's in the wrap. If a buyer buys the roll from me, and they want to return it, well, too bad, I want them in the same condition I sold them. Which is pretty much improbable, unless they had some sort of machine that the Perth Mint has. Lol. Plus those rolls are convenient to vacuum seal. :D
 
SteveS said:
I get the impression from discussions in here that milkspotting of coins is a growing problem. Is that true? Does milkspotting affect newer coins more than old and, if so, is there a date before which milkspotting wasn't a significant problem?

Because I am now unlikely to add much to my small stack, I feel inclined to weight my purchases more toward aesthetic values, hence an interest in coins (not collectible numismatics).
Click to expand...


I have found that Canadian coins from the mid 2000s forward spot quite a bit, along with later year Philharmonics, Britannias, Libertads (1996-present), some later year Australian coins (spiders, etc).

In my experience the Canadian coins are the worst for milk spotting. It seems Libertads from 1996 on spot quite regularly but the spotting isn't as heavy as Canadian coins but nearly every Libertad I have seen in those years has at least a small pin point size milk spot or greater, but often on these you can't see the spots unless you turn the coin on a certain angle. Where on the Canadian coins sometimes it appears the coin is "caked" in milk spots. I would put recent Phils and Britannias close to Canadian for spotting. Other modern bullion and proofs can spot as well such as US Eagles but they aren't as bad as others listed.

If you like the early Libertads 1982 to 1995 they seem to spot the least of any modern bullion I have seen. Older Maples (when they were sold in plastic sheets) spot very little but you will see the spots when you buy them. I have found it takes up to 2 years for spots to show on new coins so if you have 5 year old + coins that aren't already milk spotted then they won't milk spot later most likely if not handled, etc.

My local stores that pay well normally will not pay well for milk spotted coins (melt or less they will pay), even for slightly better years like the Canadian wolf one ounce, bear, cougar, etc.

Just my opinion.

Jim
 
Wow. Melt or slightly better for the Canadian bear, cougar, etc...and yet the RCM charged a hunk of change for premium for those. If they held their quality, it may be a worthwhile investment. However, when you pay a premium, and that permium gets wiped clean, again, and again, who would make such an investment. Only a nutcase: doing the same thing over and over again, expecting to get a different result. I'm glad I got rid of my eagles and maples and Philharmonics and Elphants back in 2011. Whew. Those thing suck big bags of dog poop.
 
Agree. Unfortunately there are many nutcase Stackers worldwide who lapped up the tens of millions of over-priced CML milk coins produced each year. And I always thought Stackers are supposed to be wiser and better informed...........
 
For me this is a very timely thread. I been stacking a bit of gold and silver for not quite two years. Two days ago I had a look at my 1oz silver coins and found milk spots on RCM 1oz birds from 2015 and 2016 that were not there when purchased and put away. Its only a few and original purchase price is just about spot today.

I'm not too fussed (anymore). However, I am a bit disappointed with the major mints' inability or unwillingness to openly and proactively address the issue of milk spots. I had just about come to the conclusion that being very selective and purchasing mostly rolls would be my future direction with silver before noticing milk spots on my bullion coins.

I have been looking at stacking as an investment and I suppose like all investments there is also an element of risk. My Birds of Prey will more likely be worth more at spot when I sell them than purchase price. My Cougars have not spotted (yet, knock on wood) so my investment in two Cougars might pay a bit more than spot sometime in the future. There are two risks at play, in my mind, with silver coins, 1) spot price, 2) milk spots.

That being said perhaps if I hang on long enough and the major mints can not or care not to remedy the problem of milk spotting than milk spotting may become accepted as the new norm and folks will complain that they've waited for two years and their bullion coins still have not milk spotted.

I'll still purchase the occasional individual coin(s) but will be looking only at rolls of silver bullion coins as investments in the future and in with my investments I will only be purchasing soon after release and as close to spot as possible.

There's still heaps to understand and SilverStackers is certainly a great help.
 
welcome. And when you have millions or 100's of thousands of coins out there, my bet is, the person will wait to spend their hard earned money on a coin that has no spots. Sure there has to be 1 out of a 100 (in that million mintage) that has no spots...and they will wait. Unless of course you sell yours for spot or below spot, then you're okay, because at that point, the premium you paid is sucked out of that coin. As I've said in the past, I only now buy Perth Mint stuff in rolls (1 oz, 2 oz, and 5 oz). I won't buy any individual Perth coins, because the premium is wayyyyy too high. And if I sell a roll, and the person opens the roll, and the coins are riddled with spots, well, don't return them to me, unless of course you can put them back in the original perth mint seal. And that ain't happening. See what the Perth Mint and other mints around the have produced in us? They suck big ball of dog poop sacks. And I hope they are reading this.
 
barsenault said:
Welcome to the world of silver. No matter you get, you'll always have this worry. Unfortunately. The only pieces I've never seen spot, but I'm sure they do are the Morgan dollars (?). Okay some claim that the collectible Canandian stuff doesn't spot. Who knows. But I'd say pretty much anything can spot, unfortunately. If you're looking at rounds or generic govt issued coins like Eagles, Maples, Philharmonics, Roos...who cares, it really is bullion, and you are playing the price of spot. But if you stack semi-Numi coins, which I consider the beast to be, along with the Perth Stuff, China Pandas, etc...and they develop spots, kiss your $4-8 premium good bye. Unfortunately.
Click to expand...

Totally agree with you, experienced stacker! ;)
 
It is easy to buy silver coins that won't milk spot. Just buy coins greater than 5-6 years old that have not milk spotted already, put the coin in a air tite type holder and don't touch the coin without gloves on.

I have seen lots of milk spotted coins, but have never seen a coin older than 5 or so years, milk spot after that point in time if it hadn't already spotted.

Just my opinion.

Jim
 
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