My world-famous treatise on 90% US coinage
Weiss
Posts: 9,941 ✭✭✭✭✭
Apropos of coincoins post asking which you prefer.
One new point, as this was written some time ago: The recent run up in silver is different in that it *appears* to be being driven by institutional buyers (specifically futures traders and ETFs). It is logical to assume that 90% silver is being melted in vast quantities rather than re-traded as 90% because these buyers will only buy good delivery bars (1000 ounce, .999 purity).
90% US silver
Pre 1965 90% US silver is the best metals choice for the same reasons it's always been the best choice. Think about these key points in a relatively safe economic environment, and then think about them in a dangerous SHTF environment, and anywhere in between. Each point changes based on the situation, and each becomes more important the more unstable things become:
A) Recognition. People from this country and all over the world recognize it, are familiar with it, and are comfortable with it--even people who don't know anything about metals. I'd wager 90% of the US population has no idea what a gold eagle or gold buffalo is, let alone a Philharmonic or Panda. Apples to apples: They'd be just as unlikely to recognize a silver American eagle--and a silver bar or round? Forget it. But they'd recognize a 1964 dime in a heartbeat.
Divisibility. This is critical. It's already roughly 1/10th, 1/4th, 1/2, and 1 oz increments. You don’t need to estimate, cut, and weigh a piece from a larger bar. And re-weigh and agree (or disagree) on the weight for each subsequent transaction. A silver dime is a silver dime this transaction and next transaction, and the next and the next.
C) Purity. Its alloy and silver content is unquestioned and it is hallmarked by one of the largest and best-known assayers in the world. The US mint’s product purity is unquestioned going back 200 years. The 90% silver, 10% copper ratio is tried, tested, proven and unchanged for 170 years.
D) Face value. Each piece is marked with a proportional face value relative to each other piece in the series. A half dollar contains twice as much silver and is therefore valued at twice as much as a quarter. It contains five times the silver of a dime, and is therefore valued at five times as much as a dime. No matter the circumstance--recession, depression, hyperinflation, inflation, deflation, 90% US silver has been, is currently, and always will be accepted by anyone taking US money in exchange for goods or services.
E) Numismatic value. Not every piece, not every grade--at least not yet. But there have been massive meltings in the last 40 years, and it’s becoming clear that 90% US silver is much more scarce than people credit. And early BU 90% is rare. Every day that passes, this becomes more true—its population decreases—not less true as with all newly minted bullion pieces whose population increases as more are made.
F) Low premium. 90% US silver doesn't usually carry a heavy premium relative to other forms of metals. And it can still be found with no premium at all if you look for it. And even at today's premium, dimes, quarters, and halves don't carry anywhere near the premium that 1/10th or 1/4 eagles and buffalos do. Low premium (and recognition as previously mentioned) is the reason that pre ’64 US silver is superior to silver eagles.
G) Trustworthiness. Because of its small size, ease of recognition, and relatively low value per piece, 90% US silver is one of the least profitable and therefore least tempting targets for counterfeiters here and abroad. That’s not true of gold coins of any type. And silver and gold bars can and have been “drilled & filled” (drilled out, metal removed and filled with base metal). That’s virtually impossible and not cost effective for 90% US silver coins.
Additional thoughts: "We" the collectors, hoarders, etc., can tell instantly, with virtual certainty, if a 90% US silver coin is legit--no equipment necessary, no balance beam, no scratch test or water displacement. No filing, no loss of metal, no paying someone else and/or trusting someone else to test. We can do this by several sense tests that we always have with us.
We check visually:
US coin? Check.
Overall "look" right? Check.
Exact size correct? Check.
Pre '65 date? Check.
Full silver colored edge? Check.
No flaking, pitting, etc. that would indicate counterfeit? Check.
We check by touch:
Does it have the right heft--one that we've known for years? Check.
Does it have the right surface? Check.
Reeds all present, hasn't been shaved? Check.
Does its hardness feel correct? Check.
We check by sound. We know the sound a 90% US silver coin makes when it's rung or dropped.
Check check check.
All of these steps take less than an instant, we always have the equipment with us, and we trust the results. And if we can tell this easily with this degree of certainty, anyone can with practice. Not so with foreign coins, bars, or rounds.
It's no coincidence that these factors are there. They've all come about from literally thousands of years of testing, trial, and experimentation, representing untold billions of transactions. Every culture, every age. Weaknesses exploited by the most cunning criminals in the world, corrected, improved, tried, corrected, improved, etc. until they are as perfect as can be, where all of these factors function automatically without us even thinking about them.
Ultimately, for all of the above reasons, 90% US silver wins because of Gresham's Law and supply & demand. Because it's known, because it's recognized, because it's safe, because it's trusted, in whatever level of crisis where metals may be needed, 90% US silver will be the preferred medium of exchange. This preference will make it the most desirable, which will make it the most valuable, and so on and so on. And all of this will simultaneously lower the value of all other metals choices relative to 90% US silver.
Comparisons: Pre ’65 US 90% vs. other options
US Silver Eagles
Silver Eagles carry a heavy premium. They’re also far less recognized than 90%. And Eagles, at least as of writing, are not offered in pre-weighed sub-ounce units.
Silver bars
Silver bars are not universal in design. Even the largest manufacturers are unknown to the vast majority of the general population. They have virtually no numismatic value or even potential for numismatic value. Their lack of familiarity makes them a good target for counterfeiting. Their quality of assay is unknown. The larger bars are susceptible to drilling & filling, there are very few pieces available smaller than 1 oz.
Foreign silver coinage
Older circulating silver coinage is a hodge-podge of purities, weights, and dates. Modern silver 1-oz coinage (maples, pandas, libertads, etc) are far less well-known than silver eagles, which are far less well known as pre ’65 US 90%.
One new point, as this was written some time ago: The recent run up in silver is different in that it *appears* to be being driven by institutional buyers (specifically futures traders and ETFs). It is logical to assume that 90% silver is being melted in vast quantities rather than re-traded as 90% because these buyers will only buy good delivery bars (1000 ounce, .999 purity).
90% US silver
Pre 1965 90% US silver is the best metals choice for the same reasons it's always been the best choice. Think about these key points in a relatively safe economic environment, and then think about them in a dangerous SHTF environment, and anywhere in between. Each point changes based on the situation, and each becomes more important the more unstable things become:
A) Recognition. People from this country and all over the world recognize it, are familiar with it, and are comfortable with it--even people who don't know anything about metals. I'd wager 90% of the US population has no idea what a gold eagle or gold buffalo is, let alone a Philharmonic or Panda. Apples to apples: They'd be just as unlikely to recognize a silver American eagle--and a silver bar or round? Forget it. But they'd recognize a 1964 dime in a heartbeat.
Divisibility. This is critical. It's already roughly 1/10th, 1/4th, 1/2, and 1 oz increments. You don’t need to estimate, cut, and weigh a piece from a larger bar. And re-weigh and agree (or disagree) on the weight for each subsequent transaction. A silver dime is a silver dime this transaction and next transaction, and the next and the next.C) Purity. Its alloy and silver content is unquestioned and it is hallmarked by one of the largest and best-known assayers in the world. The US mint’s product purity is unquestioned going back 200 years. The 90% silver, 10% copper ratio is tried, tested, proven and unchanged for 170 years.
D) Face value. Each piece is marked with a proportional face value relative to each other piece in the series. A half dollar contains twice as much silver and is therefore valued at twice as much as a quarter. It contains five times the silver of a dime, and is therefore valued at five times as much as a dime. No matter the circumstance--recession, depression, hyperinflation, inflation, deflation, 90% US silver has been, is currently, and always will be accepted by anyone taking US money in exchange for goods or services.
E) Numismatic value. Not every piece, not every grade--at least not yet. But there have been massive meltings in the last 40 years, and it’s becoming clear that 90% US silver is much more scarce than people credit. And early BU 90% is rare. Every day that passes, this becomes more true—its population decreases—not less true as with all newly minted bullion pieces whose population increases as more are made.
F) Low premium. 90% US silver doesn't usually carry a heavy premium relative to other forms of metals. And it can still be found with no premium at all if you look for it. And even at today's premium, dimes, quarters, and halves don't carry anywhere near the premium that 1/10th or 1/4 eagles and buffalos do. Low premium (and recognition as previously mentioned) is the reason that pre ’64 US silver is superior to silver eagles.
G) Trustworthiness. Because of its small size, ease of recognition, and relatively low value per piece, 90% US silver is one of the least profitable and therefore least tempting targets for counterfeiters here and abroad. That’s not true of gold coins of any type. And silver and gold bars can and have been “drilled & filled” (drilled out, metal removed and filled with base metal). That’s virtually impossible and not cost effective for 90% US silver coins.
Additional thoughts: "We" the collectors, hoarders, etc., can tell instantly, with virtual certainty, if a 90% US silver coin is legit--no equipment necessary, no balance beam, no scratch test or water displacement. No filing, no loss of metal, no paying someone else and/or trusting someone else to test. We can do this by several sense tests that we always have with us.
We check visually:
US coin? Check.
Overall "look" right? Check.
Exact size correct? Check.
Pre '65 date? Check.
Full silver colored edge? Check.
No flaking, pitting, etc. that would indicate counterfeit? Check.
We check by touch:
Does it have the right heft--one that we've known for years? Check.
Does it have the right surface? Check.
Reeds all present, hasn't been shaved? Check.
Does its hardness feel correct? Check.
We check by sound. We know the sound a 90% US silver coin makes when it's rung or dropped.
Check check check.
All of these steps take less than an instant, we always have the equipment with us, and we trust the results. And if we can tell this easily with this degree of certainty, anyone can with practice. Not so with foreign coins, bars, or rounds.
It's no coincidence that these factors are there. They've all come about from literally thousands of years of testing, trial, and experimentation, representing untold billions of transactions. Every culture, every age. Weaknesses exploited by the most cunning criminals in the world, corrected, improved, tried, corrected, improved, etc. until they are as perfect as can be, where all of these factors function automatically without us even thinking about them.
Ultimately, for all of the above reasons, 90% US silver wins because of Gresham's Law and supply & demand. Because it's known, because it's recognized, because it's safe, because it's trusted, in whatever level of crisis where metals may be needed, 90% US silver will be the preferred medium of exchange. This preference will make it the most desirable, which will make it the most valuable, and so on and so on. And all of this will simultaneously lower the value of all other metals choices relative to 90% US silver.
Comparisons: Pre ’65 US 90% vs. other options
US Silver Eagles
Silver Eagles carry a heavy premium. They’re also far less recognized than 90%. And Eagles, at least as of writing, are not offered in pre-weighed sub-ounce units.
Silver bars
Silver bars are not universal in design. Even the largest manufacturers are unknown to the vast majority of the general population. They have virtually no numismatic value or even potential for numismatic value. Their lack of familiarity makes them a good target for counterfeiting. Their quality of assay is unknown. The larger bars are susceptible to drilling & filling, there are very few pieces available smaller than 1 oz.
Foreign silver coinage
Older circulating silver coinage is a hodge-podge of purities, weights, and dates. Modern silver 1-oz coinage (maples, pandas, libertads, etc) are far less well-known than silver eagles, which are far less well known as pre ’65 US 90%.
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 can't argue with any of that. Great points.
I like to throw a handfull of silver quarters down on my desk and listen to it. Sounds like money.
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Member ANA, SPMC, SCNA, FUN, CONECA
The lack of a premium and the ability to break it up and sell *exactly* the amount I want to (large or small) at any time are the 2 key reasons I prefer it.
MJ
Fellas, leave the tight pants to the ladies. If I can count the coins in your pockets you better use them to call a tailor. Stay thirsty my friends......
Silver Eagles have quite a few advantages that offset the ease of use and recognition of 90% silver coins. Silver Eagles are all a standard weight (one troy ounce), making it easy to calculate their value without having to multiply face value x silver price x .715 (and adjusting for wear). Silver Eagles are .999 pure, making them less expensive to refine if necessary. They are eligible for IRA's. They aren't subject to heavy discounting during extreme price runups. (During the height of the 1979-80 mania, 90% silver coins were trading at discounts of 25% to 30% under their metal value!)
The premium for Silver Eagles exists because, for the above reasons, silver coin investors prefer them to 90% silver coins (which typically trade at a slight discount to melt). That's why the less desirable 90% silver coins are hitting the melting pot, while Silver Eagles are being scooped up by investors as fast as they can be minted.
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Yupppp. Walkers are very cool 90%. I would pick up a handful out of the B&M junk bin every time I visited, usually to buy or sell something a little more formidable than a lowly, vf-g walker. Finally, I have stuck with it to where I have a whitman almost complete in g-vg except for the nose bleeds but along the way I ended up with a few extra rolls of these frisbee sized artifacts of US coinage from our previous generation. Would you believe those puppies are worth about 20 buks a copy now? We're talking $400 a roll, outta the junk bin...whodathunkit? If we get to shtf, or teotwawki, or yoyo, or obamacare, or whatever fate is waiting for us, I'm sure the walker will parlay on the street just fine as will those washie stashes and don't even start with the mercs, woah.
Sure, there's a pile of the mercedes class ase's in everyones pile but when you want to play scrouge mcduck...try getting a salad bowl full of walkers out and going BWAAHHAAAHAAAHAAA; you can't do that with ase's, might scratch them up.
<< <i>If 90% silver coins are the "best metals choice," then why do Silver Eagles carry such a high premium? >>
Because people are stupid. Case in point: Some people actually argue that having a large premium on a commodity is a benefit.
--Severian the Lame
<< <i>
<< <i>If 90% silver coins are the "best metals choice," then why do Silver Eagles carry such a high premium? >>
Because people are stupid. Case in point: Some people actually argue that having a large premium on a commodity is a benefit.
Don't you usually get that premium back when you sell your ASE? Anyone know the how the typical buy/sell spread of 900 junk silver coins compares with ASE's?
Worry is the interest you pay on a debt you may not owe.
"Paper money eventually returns to its intrinsic value---zero."----Voltaire
"Everything you say should be true, but not everything true should be said."----Voltaire
<< <i>If 90% silver coins are the "best metals choice," then why do Silver Eagles carry such a high premium? (One major dealer is currently offering $3 over melt for large quantities of Silver Eagles.)
Silver Eagles have quite a few advantages that offset the ease of use and recognition of 90% silver coins. Silver Eagles are all a standard weight (one troy ounce), making it easy to calculate their value without having to multiply face value x silver price x .715 (and adjusting for wear). Silver Eagles are .999 pure, making them less expensive to refine if necessary. They are eligible for IRA's. They aren't subject to heavy discounting during extreme price runups. (During the height of the 1979-80 mania, 90% silver coins were trading at discounts of 25% to 30% under their metal value!)
The premium for Silver Eagles exists because, for the above reasons, silver coin investors prefer them to 90% silver coins (which typically trade at a slight discount to melt). That's why the less desirable 90% silver coins are hitting the melting pot, while Silver Eagles are being scooped up by investors as fast as they can be minted. >>
The premium on ASE's is the exact reason that I prefer 90%. In my opinion, the ASE premium is due to collector value. 90% is more utilitarian. In my opinion, ASE's are for collecting stackers and 90% coins are for utilitarian stackers.
>
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go to the smelter and that delay might mean being offered 10-30% less for your silver. Just a thought.
roadrunner
<< <i>C) Purity. Its alloy and silver content is unquestioned and it is hallmarked by one of the largest and best-known assayers in the world. The US mint’s product purity is unquestioned going back 200 years. The 90% silver, 10% copper ratio is tried, tested, proven and unchanged for 170 years. >>
Overall a convincing argument from the OP, but I agree with roadrunner. The problem with 90% is that it is not pure, it must be further refined to use.
Liberty: Parent of Science & Industry
<< <i>
<< <i>If 90% silver coins are the "best metals choice," then why do Silver Eagles carry such a high premium? >>
Because people are stupid. Case in point: Some people actually argue that having a large premium on a commodity is a benefit.
I don't think having a large premium on Silver Eagles is a benefit. I think the benefits I listed above (standard weight, .999 purity, IRA eligible, resistance to discounting) justify the premiums that are attached to Silver Eagles.
If the premium exists simply because "people are stupid," then their alleged "stupidity" in this regard spans a remarkable 25 years. So will they magically become "smart" and abandon the Silver Eagle premium when a massive financial crisis occurs?
For those who think the premium is that big a deal, consider these two words: War Nickels.
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<< <i>The premium for Silver Eagles exists because, for the above reasons, silver coin investors prefer them to 90% silver coins(which typically trade at a slight discount to melt). That's why the less desirable 90% silver coins are hitting the melting pot, while Silver Eagles are being scooped up by investors as fast as they can be minted. >>
Since this was posted the bolded part has changed. Now 90% carries a premium that I believe is here to stay.
I'm still finding 90% locally trading at a discount. But I think my B&M (or maybe the other local buyers) just don't like 90%.
--Severian the Lame
<< <i>
<< <i>The premium for Silver Eagles exists because, for the above reasons, silver coin investors prefer them to 90% silver coins(which typically trade at a slight discount to melt). That's why the less desirable 90% silver coins are hitting the melting pot, while Silver Eagles are being scooped up by investors as fast as they can be minted. >>
Since this was posted the bolded part has changed. Now 90% carries a premium that I believe is here to stay. >>
Since this was posted the price of silver has fallen by more than half. I think that has a lot to do with the premium that is attached to 90% silver today. When the price of silver collapsed in 1980, the price of 90% silver went from a 25% discount to a 30% premium in a short period of time. That premium disappeared as the price of silver began rising again, and I expect the same thing to happen again if the price of silver rises over the next few years.
My Adolph A. Weinman signature
<< <i>
<< <i>
<< <i>The premium for Silver Eagles exists because, for the above reasons, silver coin investors prefer them to 90% silver coins(which typically trade at a slight discount to melt). That's why the less desirable 90% silver coins are hitting the melting pot, while Silver Eagles are being scooped up by investors as fast as they can be minted. >>
Since this was posted the bolded part has changed. Now 90% carries a premium that I believe is here to stay. >>
Since this was posted the price of silver has fallen by more than half. I think that has a lot to do with the premium that is attached to 90% silver today. When the price of silver collapsed in 1980, the price of 90% silver went from a 25% discount to a 30% premium in a short period of time. That premium disappeared as the price of silver began rising again, and I expect the same thing to happen again if the price of silver rises over the next few years. >>
Maybe or maybe not as more gets melted with every run up and the increased amount of stackers. If it does I will take advantage of the opportunity.
Keep buying 90% silver!
>
Successful transactions on the BST boards with rtimmer, coincoins, gerard, tincup, tjm965, MMR, mission16, dirtygoldman, AUandAG, deadmunny, thedutymon, leadoff4, Kid4HOF03, BRI2327, colebear, mcholke, rpcolettrane, rockdjrw, publius, quik, kalinefan, Allen, JackWESQ, CON40, Griffeyfan2430, blue227, Tiggs2012, ndleo, CDsNuts, ve3rules, doh, MurphDawg, tennessebanker, and gene1978.
>
Successful transactions on the BST boards with rtimmer, coincoins, gerard, tincup, tjm965, MMR, mission16, dirtygoldman, AUandAG, deadmunny, thedutymon, leadoff4, Kid4HOF03, BRI2327, colebear, mcholke, rpcolettrane, rockdjrw, publius, quik, kalinefan, Allen, JackWESQ, CON40, Griffeyfan2430, blue227, Tiggs2012, ndleo, CDsNuts, ve3rules, doh, MurphDawg, tennessebanker, and gene1978.
* - (ref. Weiss' Treatise 2011 CU-PM)
aloha, out.
<< <i>"World Famous," I'm just now reading this treatise.
* - (ref. Weiss' Treatise 2011 CU-PM)
aloha, out. >>
I called it "world famous" in a tongue-in-cheek way, because when I wanted to reference it (back when the search function wasn't working at all here), I found it cut and pasted almost word for word on at least two other websites
Anyway, it's free info on the internet, so it's worth what people pay for it. And I encourage people to find fault with any of the points, and I'm happy to make changes to it. But I think most if not all of the points are still valid and will remain so over time. Much smarter people than I have risked their lives to cheat on this system. And much smarter people than I have foiled their efforts. You know the modern phenomenon of software companies offering prizes to people who can successfully hack their systems? Imagine the worst criminals in history putting untold effort over thousands of years trying to crack these simple characteristics. So far they haven't really succeeded. Or if they have, subtle changes have been made to successfully thwart them. That's the beauty of 90%.
--Severian the Lame
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Thanks!