The perfect storm: silver stampede and coin bubble bursting?
Weiss
Posts: 9,941 ✭✭✭✭✭
Every few weeks we're hearing how coins are getting close to the top of a bubble. I personally don't see it, but I've been wrong many times before.
At $10.65 per ounce today, silver could be topped out, too. Or with the release of the silver ETF, global insecurity, and enormous pressure on fiat currency and natural resources, we could be at the start of a massive price spike.
So what if the perfect storm erupts: the coin market goes pop just prior to silver hitting $50, $75, maybe $100 per ounce?
Think about it: Your MS65 widget Morgans that had been trading for $150 in June suddenly lose almost all support. They're worth $125, then $100. By August, they're trading for $75--if you can find a buyer. All of the sudden, silver hits its stride and zooms up to $140 per ounce in September. You've been selling your circulated silver, your rounds, your junk, maybe even a few sliders and MS63 coins for months now. But that pile of slabbed MS65 dollars is just sitting there, costing you opportunities. Your smelter says he'll pay you $125 each.
What do you do?
At $10.65 per ounce today, silver could be topped out, too. Or with the release of the silver ETF, global insecurity, and enormous pressure on fiat currency and natural resources, we could be at the start of a massive price spike.
So what if the perfect storm erupts: the coin market goes pop just prior to silver hitting $50, $75, maybe $100 per ounce?
Think about it: Your MS65 widget Morgans that had been trading for $150 in June suddenly lose almost all support. They're worth $125, then $100. By August, they're trading for $75--if you can find a buyer. All of the sudden, silver hits its stride and zooms up to $140 per ounce in September. You've been selling your circulated silver, your rounds, your junk, maybe even a few sliders and MS63 coins for months now. But that pile of slabbed MS65 dollars is just sitting there, costing you opportunities. Your smelter says he'll pay you $125 each.
What do you do?
We are like children who look at print and see a serpent in the last letter but one, and a sword in the last.
--Severian the Lame
--Severian the Lame
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Comments
<< <i>
What do you do? >>
Simple. Just don't be the idiot that buys at the top.
Cartwheel
Cartwheel's Showcase Coins
Too bad my crystal ball's not working right now.
A. Are very plentiful
B. Are very beautiful
C. Are very popular
D. Are probably the most traded US coin in existence
E. Are 90% silver
F. Are graded to the speck of a %
G. Are the most widely speculated coin in US modern history
H. Have recently been showing up with monster tones (didn't even used to be any other than endrollers)
I. Have sucked in more newbies than Adjustable Rate Mortgages
J. Are marketed in newspapers, magazines, TV, etc. to the totally clueless
K. Are probably in more collections than State Quarters
L. Have been melted by the govt., yet they are still all over the place
M. Are readily available in Gem grades except for a few dates
N. Have taken to VAM id rarity indexes to further drive collecting interest
O. Are a classic US coin that has an international following
P. Are conspicuously manipulated by market makers
Q. Are the bellweather coin of coin collecting
R. Are big hunks of silver
S. Are available raw in MS
T. Are collected by more coin collectors than any other series except maybe Lincoln cents
U. Have ruined many collectors in the '80's
V. Have values that move in cycles relative to employment and property values
W. Have value that is a direct reflection of available individual investment/discretionary funds
X. Are extreemly vulnerable to financial pressures
Y. Are so thick on Ebay that you can just about see one on every page
Z. Are occasionally found with manipulations but are rarely found counterfeited.......
So, A to Z, they are very important US coins. The silver ETF may be like the gold ETF Text...highly speculative and not producing the type of stablility one would expect...just short of playing derivitives on the open market because there is so much paper metal and questionable physical metal to back the paper. So, there could be a perfect storm. Parts of the coin market will correct when the ARM's, cost of living (fuel and interest rates), and entitlements/benefits begin to contract. Your perfect storm would see morgans melted for considerably more than anyone would be willing to pay for the numismatic value and because they are so widely held, we would once again be floating in $500 morgans worth $85, just like 20 years ago except then, silver was worth about $6. All things move in cycles, everything is connected to everything else...life is good.
Nice postulation, Weiss "Your smelter says he'll pay you $125 each" Yeah Baby...
Enjoy,
Saul Goode
<< <i>
Nice postulation, Weiss "Your smelter says he'll pay you $125 each" Yeah Baby...
Enjoy,
Saul Goode >>
Exactly. I was a kid back in the early 1980s, but I was still a pretty serious collector and I knew good coins were going into the pot.
Silver blowing up while coins falling flat is a very real possibility now, and it could spell the end to some very good, scarce coins. If the coins in your XF-AU collection of dollars, coins that you bought for maybe $20 to $50 each, were suddenly worth $100 each no questions asked, what would you do?
--Severian the Lame
<< <i>What difference does the state of the market make? We're coin collectors here, not investors... right? We don't care which way the market is heading since we collect coins because we like them and the history they represent, not because they might increase in value. Sell?? Get serious!
"The silver is mine and the gold is mine,' declares the LORD GOD Almighty."
Go BIG or GO HOME. ©Bill