POLL: Silver Run-up Reality Check

baccaruda

There's lots of talk about silver lately and why not? It's sat in stagnation for 15 years now. There's also a lot of "crazy talk" about $50 and $100 silver again.

I, like most of you probably, hold a lot of silver. Junk silver, SAEs etc.

The question is, at what spot price would you sell your silver coins strictly because of their silver content?

originalisbest

Not until it soars past $200 an ounce.

Russ

You forgot a "now before I lose my ass option".

Russ, NCNE

pontiacinf

Ill go with Russes option, makes the most sence

fishcooker

$10/oz, $20/oz...... I don't own enough to make a big deal out of it. When I get ready for a free fishing trip then I'll sell it. I bought a slug after 9/11, when oddly enough the price fell to like $4.20.

It's not like I have $50,000 worth of silver sitting around awaiting $10/oz..........

BigGreek

My father-in-law, who's done very well over the years has
one piece of advice: never sell anything going up and never
buy anything going down.

edsondl

I think that it actually depends on numerous things, rather than a "magical" price point at which to sell.

1. Is the price currently increasing, decreasing or sitting more or less constant?

2. Which coins am I considering selling for melt- is it the two rolls of silver eagles that I bought purely for their silver content, are they the silver eagle date set that I have in an album, are they the junk silver bags of roosevelts and washingtons, is it the circulated set of washingtons in 2x2's in an album or is it the uncirculated peace dollar set?

I think that many of us have some extra silver that has been bought for its silver content. The price at which we each should sell should not be an arbitrary price point, but instead decided based on analysis of the market on a week to week basis. This silver will be easy to sell for spot.

Likewise many of us have high grade sets, either raw or slabbed, whose value does not depend on the silver content, so these would never sell for spot.

The tricky coins are those sets of circulated silver coins sitting in folders, 2x2's or dansco albums. Any coin by itself is not that special, but a complete set of silver roosevelts, washingtons or franklins is something that you enjoy owning. It is the sale of these coins for melt that will try collector's hearts if silver continues to rise.

fishcooker

BG - sounds like a guy who knows how to make an account balance get larger......

cladking

All of the above.

Eventually silver will break out and I intend to sell on the way up a little at a time.

Weiss

I don't want to sound like a kook here, but my silver isn't an "investment", it's a hard asset. So it's relative worth to the paper dollar or paper investments doesn't really matter to me. I figure if silver goes to $50 per ounce, that just means that the paper dollar has declined in worth relative to the never changing, never shrinking troy oz of silver. So I don't think I'd sell mine unless it shoots to some outrageous amount. We're talking a hundred times what it is now. Then my paper debt held against my other hard assets (real estate) could be largely "paid off" with the proceeds of my silver. That I might consider.

I'm not an extreme hard assets, SHTF scenario kind of guy. I just balance out my portfolio for the long term. I've got a considerable amount invested in paper (mutuals through my 401(k) and IRA). Silver is the heavy stuff on the other end of the balance beam. It's about balance.

baccaruda

Weiss - turn on your PMs in your profile.

LAWMAN

I'm with Russ, I was looking for that option.

ddink

Russ, Lawman, etc., why do you think silver will go back down? Because the market manipulation will continue, and will ultimately win? Because you believe the annual silver deficit will reverse itself? We've heard a lot of bull arguments, let's hear some bear arguments.

Bear

Smoebody call for a bear. Sell half your holdings now

and wait for developements.

bulloncoins

When people realize it is more valuable than gold. That is how I see it. Unless someone comes up with a new use for gold that also consumes it, or pulls a lot of silver out from nowhere.

mercurynut

All my silver coins and rounds are gone when it crosses $10.

MoneyLA

I think we have a good shot of getting back to $50 an ounce, for a long term "double top" in the market. at $50 for silver, ms65 morgans could return to $400 each. i would call that a nice point for profit taking. but the big overhead resistance is at $13 in this cycle. cheers, alan mendelson

Bobk

Stoped in the local coin shop today and was looking at a 92S morgan but that is another story. The owner

offered me a 100 oz. bar(s) @ $805.00. I thought it was a fair price. But I had my eye on that 92S.

SportsModerator

My personal feeling is that $50 is on the low end. The 1980 top will be taken out with ease, a fall back to the 40's as those with the mindset that $50 is the "magic" number will dump their holdings on the market, then we will see a much higher figure. Dare I say it? say it! say it! $100+ per oz.

I agree that lines of resistance exist at $13, $18, and $27

coynclecter

It doesnt cost 50 or 100 to get it out of the ground. If the price rises so will the mining and theres enough silver in the ground for everyone. If the price ever goes back to that it will be a market manipulation (like 1980) and you better sell when you can.

Have you guys taken your medicine today.

SportsModerator

Silver production is a byproduct of copper, and other metal mining. The majority of the silver mines have been played out or "high graded", namely the silver that is more plentiful, ie. a higher percentage recoverable per ton of ore, is long gone. Don't let them con you by saying that once the price goes up, production will eclipse demand. 1904 yes, 2004 no

ddink

coynclecter, you do realize that the vast, vast majority of silver is a byproduct of mining for other metals. If memory serves me (and I'll admit it frequently doesn't!) there are fewer than purely silver producing mines in the world. As Warren Buffett said:



<< <i>Most of that silver is produced as a by-product in the mining for copper, lead or zinc. Since it's a by-product, it's not very responsive to price changes. >>

coynclecter

Yes, but thats because they get all the silver they need without going out to mine specifically for it. If the price went up 10-20x do you think they might start looking again.

BTW

who says the the price has gone up? True in terms of dollars. Has the price gone up significantly in YEN or EURO in the last 5 years? as much or more than inflation?? or has the dollar simply gone down.

jimtre

In the early 70's I was payi8ng $7 for a book of Rooselvelts, from
the coin store. I did not have a lot of money and that was my way of
investing. They had to be in the good books though (with the slides).

I was also paying 20% over face for circulated silver and 30% over
face for uncirculated silver. It was a tad bit more than dealers but
It wasn't like I was buying a ton of it. A little later I bid on a
$1000 dollar lot at a credit union (it had been used for collaterol.
I won the lot at 6n times face as I recall. My boss and a friend
took half of it at bid (that was our deal) and I sold the rest at 7
times face. It turns out that after counting the bac there was
actually $1110 with a windfall of profit as I bid a dollar amount for
the lot and not so much per. I had to sell the half because as I
said I was not a dealer and just piddling around.

As silver went up I couldn't resist selling some on the way up. It
seemed the logical thing to do and by this time I was kinda dealing
in coins.

When the price of silver hit the all time high the friend that bought
the 1/4 bag and I took ALL of the silver I had left which was mostly
uncirculated as I had sold NONE of the uncirculated on the way up and
took it to the local dealer at sold it ALL at 23 TIMES face yes 23
times face and believe it or not it was the actual TOP for silver
prices. The next day it started its dramatic drop. If you guys
remember ANYBODY that had a futures contract lost their #### as they
were locked in because of limit moves (no Buyers) and it took several
days before it dropped low enough to the actual demand price. NOTE:
This is futures not the physical metal itself. It was devasting and
cazused many bankruptcy's and almost the Hunt brothers.

There is an interesting article on the Kitco home page about short
sellers now that if true will see the opposite of the above happen
and the SHORT SELLERS will get BURNT.
http://www.kitco.com/ind/Hornig/apr012004.html

An interesting thought on the great silver melt was brought up
repeatedly and I think just now is coming to light (actually in the
last few years).

SO MUCH uncirculated silver was sold and melted that the actual
figures AVAILABLE of uncirculated later date silver coins may never
actually known.

So I kinda mess with silver now and I guess will sell as it goes up.
I could only be so lucky as last time and sell at the all time high
23 times face.

Jim

ddink

<< <i>Yes, but thats because they get all the silver they need without going out to mine specifically for it. If the price went up 10-20x do you think they might start looking again. >>



Certainly, but how much will they find when they go looking for it? How much will it cost to mine it (if the ore isn't rich it could cost $10-$20 or more to get it out of the ground)?

SportsModerator

So they start looking. Do you think that they can just turn on a switch and the metal flows? It takes a couple of years to get equipment, crushing and milling facilities, on site. Heck, it takes a year to get an environmental impact survey done before they can even put a shovel in the ground.

cladking

<< <i>coynclecter, you do realize that the vast, vast majority of silver is a byproduct of mining for other metals. If memory serves me (and I'll admit it frequently doesn't!) there are fewer than purely silver producing mines in the world. As Warren Buffett said:



<< <i>Most of that silver is produced as a by-product in the mining for copper, lead or zinc. Since it's a by-product, it's not very responsive to price changes. >>

>>



This is exactly one of the most interesting things about this move! Silver generally
wants to move opposite of the way copper is moving since increased copper prices
will increase mine production and hence silver production.

Copper, however, is doing nearly as well as silver and is approaching all time highs.
The silver bull won't be killed by copper or increased production.