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Old 09-10-2008, 07:03 AM   #1
bennett
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Smile Micro-Investor's Guide to Buying Silver

In the case of economic collapse where we’re faced with barter based markets, it seems clear that a well-rounded survival inventory should include some silver, and probably gold. For example, see the “Safeguarding of Assets” and “Survival Awareness” on the Resources page of this site (thanks Bill & Kerry).

Now I’m not an expert, or even very experienced “precious metal investor”. 2 months ago, I didn’t know the first thing about it. But listening to George Green’s July interview on Project Camelot finally motivated me to look into it. I was wondering how the heck does someone like me without a lot of money get some precious metals. I certainly can’t afford to be buying gold eagles. But after some research on the internet, found that it’s really quite simple and came up with an approach that is working for me. I’d like to share some of my finding and tips for those who may be interested, in the hopes that it may help to jump start your own efforts. There’s a lot of info on this, and this is a long post, but I’ll try to minimize the detail while providing some links to start with should you like to look into it further. Also, this mostly applies to those who live in the USA.

First, focus on buying “junk silver” American coins. These contain 90% silver and include dimes, quarters, half dollars and silver dollars issued in 1964 or earlier. Many reasons for this, but again, keeping it brief. See http://www.cmi-gold-silver.com/small...ver-coins.html

Second, the best place I’ve found is (take a guess) EBay. Searching “circulated silver”, “junk silver”, “silver rolls” will return 100s if not 1000s of listings. I find that other places, such as coin and bullion dealers, tack on fairly large premiums ($2.00 or so per oz.), have large minimum purchase requirements and mostly don’t provide for on-line purchase. If your looking at 10s of $ per purchase like me, instead of high 100s or 1000s, EBay is the place to go.

Third – how to calculate a fair price to pay. For ultra simplicity use the online calculator here: http://www.coinflation.com/coins/sil...alculator.html This calculator automatically enters the current spot price of silver. You use a pull down menu to select which coin you want and enter the quantity, and it returns the total value. A couple disadvantages here: If you’re looking at a mixed lot, you’ll have to calculate the value of each set of coins separately. Also the calculator doesn’t apply the generally accepted discount for wear or real-world melt value, so the price may be a little more. But for the dollar amounts we’re talking about, the difference is almost negligible (about 11 or 12 cents per $10), which is lost in the noise what with bidding and shipping charges.

If you want to calculate yourself, the formula is:

Fair price = ($ face value) x (today’s silver price in $/oz) x (discounted amount of silver in troy ounces/$ face value).

You can get the current silver price on http://www.kitcosilver.com/ or many other financial web sites. On Kitco, I use the ask price at the top left corner.

The discounted amount of silver per $ face value is:
o For dimes and quarters .715 tr-oz per $ of face value
o For Halves: .719 tr-oz per $ of face value
o For Dollar coins: .765 tr-oz per $ of face value (this is my own estimated discount, which actually is pretty useless, because dollars always seem to go for $2 or more premium)

Here’s an example: Let’s say your bidding on a roll of 50 dimes, silver closed at $11.65.
Face value = $5.00
Silver price = $11.65
Amt of silver is .715
Fair price = 5.00 x 11.65 x .715 = $41.65

Using the on-line calculator returns $42.14

That may seem like a lot for “$5 worth” of coins, but in a collapsed economy, it might just buy you a few meals or some clean water.

A couple other tips:
You’ll probably end up paying 5 -10% more than your calculated price after final bid with shipping charges. That’s true especially now with silver at a 2 year low. A lot of sellers disappeared when prices tanked, so there’s a relatively lot of demand with less supply. My own feeling is that current prices are a bargain even if you pay a dollar or so more than spot price.

Dollar coins go for a large premium as mentioned above; older coins and halves seem to go for a small premium. I don’t know if that’s because they’re scarcer or what, but in my mind, Roosevelt dimes will probably trade just as well as Mercury dimes in survival mode. For the best average price, I try to stick with dimes and quarters, with a small selection of halves and dollars.

Stay away from single coin purchases. Most of these are collector coins which aren’t really appropriate. Or if they’re junk, then they’re not worth the price you’ll pay after shipping. Best are rolls, or odd and mixed lots of at least half a dozen coins. I think my smallest lot was 11 coins, which was only an okay deal after shipping.

As with many EBay auctions, better deals are found in off hours. When prices were higher, I got most of my deals around midnight on week nights. Here on the west coast, late night is an advantage, it might be better early AM on the east coast. With judicious buying, I was able to keep my purchases right around spot price, even after shipping. Now though, with prices down, I don’t see many auctions ending in off hours. That will change when prices rise again, as they inevitably will.

If you haven’t already, I encourage everyone to get a least a small amount of silver while prices are down. Read the silver articles linked on the Resources page – it’s obvious that the market is being manipulated. Besides our concern about future economic conditions, fundamental supply/demand dynamics haven’t changed, there’s no real market driven reason why prices are low. Silver will go up.

I hope this has been helpful. I’d love to hear comments, suggestions, corrections and/or insights from those who may be more knowledgeable. Also insights from our brothers and sisters living outside the US.

Good luck and blessings…
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Old 09-10-2008, 07:57 AM   #2
CONDE
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Default Re: Micro-Investor's Guide to Buying Silver

Thanks for caring Bennett, great info.
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Old 09-10-2008, 08:14 AM   #3
Bill Ryan
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Quote:
Originally Posted by CONDE View Post
Thanks for caring Bennett, great info.
I agree with Frank: this is great information.

EXACTLY what this forum is for. Many thanks for the contribution.

[I'm aware that there's a lot more great information elsewhere. I've not read all the threads - by any means! ]
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Old 09-10-2008, 09:11 AM   #4
lohiaaditya
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Default Re: Micro-Investor's Guide to Buying Silver

Hi,

I thought this was the best thread to say this.

I listened to the George Green interview, the latest one. He found it difficult to buy gold, but in Nepal, here, while shopping I visited a gold shop and he said I ll give you how much ever you want. I assume he said it with a certain standard of buyers in mind and I believe that he would readily give atleast $250k worth of gold for sure, keeping in mind how much rich people buy here.
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Old 09-11-2008, 03:38 AM   #5
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Default Re: Micro-Investor's Guide to Buying Silver

Fer Fal survived the collapse in Argentina, and counsels
to steer toward junk jewelry, least you be forced to
accept a junk jewelry price for gold/silver coin or bullion.

He mentioned the utility of gold/silver necklaces. Easy
to carry and easy to break off appropriate lengths during
trading.

http://ferfal.blogspot.com/
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Old 09-11-2008, 07:58 AM   #6
King Lear
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Default Re: Micro-Investor's Guide to Buying Silver

Frankly this Gold-Silver thing is BS!

It's just bargaining.
There are companies making profit with people's fear.


I tell you what has worth in a devastated, knocked down society:
food and addictive drugs like alcohol, cigarettes, chocolate and other things people desire in a end time world.



like: "Oh man i haven't drunk a sip of Cola for 1 year now, since the great catastrophe happened. - i give you 2 of my gold nuggets for a glass of Cola.

other: 3!

first: oh man... ok here you have it.

other: Deal!"



That will be of worth, nothing else! One could see it in Post-War-Germany - the only currency were cigarettes and then came alcohol and foods.
Farmers filled their treasure chests with gold, silver and fur coats, and just giving out a bag of potatoes.

Believe me it really happened that way!



So people don't fall for it! It's just greedy fear-mongering bargaining!
All this greedy gold and silver offering companies get rich through your Angst and you buy future worthless things!
Ever thought about that, the more people buy gold and silver the more the price for it increases!
And the more these greedy companies profit!

And then they use the news of price increasing to emphasize their "warnings" and to make even more money!
It's such a setup!

I hear this sickening things all the day on The Alex Jones Show. It's just bargaining with your Angst!

And it makes me so sick!

Last edited by King Lear; 09-12-2008 at 01:42 AM.
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Old 09-11-2008, 09:41 AM   #7
linkes
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Default Re: Micro-Investor's Guide to Buying Silver

mmm I was thinking exactly what king lear was thinking

If I am starving and the guy next door has some food not a lot and all I have is gold and silver he’s not going to take the gold and silver if he also has to eat

What use is the gold and silver, it can’t quench your thirst and neither can it fill you tummies.

Ill go with growing food and making sure I have a water storage and purification system rather than buy gold and silver.


peace and blessings
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Old 09-11-2008, 01:13 PM   #8
Zynox
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Default Re: Micro-Investor's Guide to Buying Silver

Gold and silver are a recognized storage mechanism for 'wealth', capable of facilitating barter ... as with any tool, their use is dependent upon the intentions of the parties in the economic eXchange.

Metal based currency is the only current form of currency that is not founded on debt, and debt is a control mechanism.

There is actually a culture of anti-gold / anti-precious metals that has been put forth by governments, because personal holding and use is counter to agendas to leverage control through unbridled fiat / paper currency shenanigans.

Once ground crews and radiant zones are established, there will be times where group A will want a windmill from group B, but only has food, and group C has gold available for trade for group A's food. Logistically, it preserves energy for the groups to swap the food for the gold and then the gold for the windmill. Why resort to paper contracts or promises, or bring three groups together for a single triple transaction when there is a reasonably functional alternative?

NAMASTE
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Old 09-11-2008, 01:55 PM   #9
Zynox
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Default Re: Micro-Investor's Guide to Buying Silver

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Originally Posted by bennett View Post
Second, the best place I’ve found is (take a guess) EBay.
Another option, in tune with local markets and getting to know neighbors, is to visit a local coin show. Many areas, even rural, have periodic shows, and in larger population areas, the frequency is every weekend.

One source for dates of shows is:

http://www.coinworld.com/News/ShowCalendar.asp

When you attend the first show, it may be a bit overwhelming, like a bazaar ... but if you wander and observe, the patterns of energy may be observed and there will usually be vendors that 'shine' ... these vendors will be friendly, have more than plastic encased numismatic coins and walk you through the options available.

Since all transitions seem to take longer than we expect, or may want, the importance of forming a network with a sincere set of folks in the metals business is that eventually you may want to establish large purchases or sell / trade back into fiat paper to pay bills. With a good network established, it is possible to minimize premiums, like in any business. Think Ground Crew - Think Rhizome ...

NAMASTE
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Old 10-10-2008, 05:48 AM   #10
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Default Re: Micro-Investor's Guide to Buying Silver

Quote:
Originally Posted by King Lear View Post
Farmers filled their treasure chests with gold, silver and fur coats, and just giving out a bag of potatoes.

Believe me it really happened that way!

...And it makes me so sick!
Well, that's the other side of it, and you're absolutely right. I've been telling everyone to stock up on cigarettes, booze, and chocolate. And don't forget things like nails, soap and sanitary napkins. These will be money.

On the other hand, people will want a form of currency, one that is backed by a reasonable standard of value. Silver is perfect. It has been THE money metal since ancient times. Those old quarters and dimes, those Franklin halves (and early Kennedys) may be worn but they contain a known quantity of silver. I'm all for putting SOME of your assets into this form.

In this as in all ventures, fear is counterproductive.
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Old 10-12-2008, 05:26 AM   #11
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The other side could be that the banks will close and reform a global system and a new currency may emerge and even if they say they will exchange your dollars for the new currency, your dollars may be only worth pennies on the dollar or amero compared to what it was worth a few weeks earlier. However, if you have a solid store of precious metals and the market evens out and things start to come back you can exchange your silver or gold for the new currency and no matter, generally speaking your silver will be worth the same as when you bought it. Relatively speaking that is. If you can buy 20 loaves of bread with an ounce of silver now when you exchange it for the new currency it should still buy just about the same amount of loaves of bread. hope that makes sense. Thanks for the thread this is good info
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Old 10-24-2008, 03:25 AM   #12
asteram
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Default Re: Micro-Investor's Guide to Buying Silver

I've bought and sold silver and gold since the late 1980s. I don't speculate in it to make money, I just like some of its advantages. For one thing, it's hard to spend these days. If I have paper currency put aside, it's too easy to grab a few bills. With gold or silver, you have to find a buyer, so one tends to hold onto it.

Another thing I like about it is it is beautiful in and of itself and beautiful things can be made from it. Did you know that when you buy new silver and gold jewelry in the USA you are generally paying 10 times the value of the metal in the jewelry? Silver at $10 an ounce spot, but a $10 silver ring probably has less than 1/10th ounce of silver in it; same for gold.

I also like sterling silver flatware, eating utensils you know. Silver kills germs. Once one gets used to eating with real silver spoons and forks, the modern stainless steel ones look and feel cheap and fake. You can pick up sterling flatware very reasonably on eBay, and you can always sell it for it's silver value if you need to.

I have bought and sold a lot of silver on eBay, mostly flatware and bowls. For silver and gold rounds and coins, though, I usually go to the local coin dealer (look in the yellow pages of the phone book) and pay a slight premium over spot; no shipping to worry about, just walk in and ask them what they have in silver rounds or junk silver, or gold ounces. They will actually give you real gold and silver in trade for pieces of paper!

Your local coin dealer is also the quickest and surest way to sell your silver and gold; they are used to people walking in with gold and silver to sell-- that's how their business works.

One more thing- although the calculations above for old US silver coins appear accurate, the general rule that coin dealers use for "junk" silver coins is $10 face value contains 7 ounces of silver. 100 dimes, 7 ounces of silver. 40 quarters, 7 ounces of silver.

Last edited by asteram; 10-24-2008 at 03:32 AM.
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Old 10-24-2008, 03:38 AM   #13
EliaDempsey
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Default Re: Micro-Investor's Guide to Buying Silver

Thank you so much for taking the time to share this helpful information.

I wish you all the best,
Elia
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