Why the large premium for Silver Eagles & Maples?
 

Why is the premium for Silver Eagles & Maples so much over the spot silver price? (Usually $2 FRN and always 10%+ above spot) And the others like pandas, Libertads & Aussies are even greater spreads.

The Eagles & Maples sure are pretty coins but are they worth the difference over 90% junk silver?? If I want to sell, should I be able to recover the premium cost??

Thanks, Bill

Re: Why the large premium for Silver Eagles & Maples?
 

The big government mints have to pay spot just to get the metal....then they have to mint and distribute...and dealers need to make some profit....

I think $2 over spot is reasonable.

While the world functions....you will get most of the premium back at sale.

In barter town/mad max....zero premium on resale.

90% junk is lowest cost silver....

Rounds and bars from big private mints and mining companies are in the $0.50 to $1.00/ozt over spot range. These are the best prices after 90%. This is my preference...but i do like Eagles and Maples.

Re: Why the large premium for Silver Eagles & Maples?
 

Thanks, that is what I thought the answer would be, but I have been seriously looking silver for all of one week, so I appreciate the help, Bill.

Re: Why the large premium for Silver Eagles & Maples?
 

The number of people willing to buy SAEs or SMs will always be higher than those willing to accept 90% - since the latter requires numismatic knowledge to know a 1962 quarter is worth much more than a 1965 quarter.

Re: Why the large premium for Silver Eagles & Maples?
 

I think Gold Eagles are not worth it, because there are widely recognized gold bullion coins available at lower cost, e.g., Krugerrands and to a lesser extent, Maples.

With silver, Silver Eagles probably have the highest recognition of all silver rounds, and thus you probably have better liquidity. Certainly in "normal" times, you probably recover the coinage premium; in "Mad Max" situations, I'd prefer lead over silver or gold, but if you were hypothetically bartering with SAEs, you'd probably have more liquidity than off-brand rounds. This is what held me back from saving .50 c/round and buying even a major private mint like Englehard.

That said, because the price of silver is so low, you're paying a huge premium to spot. So my plan is to express my principal long position in silver through junk, with less than 20% in bullion. There's always a strong demand for junk in "normal" times because of domestic silver bugs, and in abnormal times, I think the market will get quickly educated about the value of pre-65 coinage, particularly because it is so easy to do a visual check by looking at a roll in a clear tube, and looking for a zinc or copper slug.

Re: Why the large premium for Silver Eagles & Maples?
 

silver is going to $100

the extra $2 doesn't matter

Re: Why the large premium for Silver Eagles & Maples?
 

Government guarantees of purity are worth a premium to some buyers, but to me Englehardt and J&M rounds have such a "sterling" reputation amongst many buyers that they are the rounds I purchase. Zero ASEs or Maples for me so far. I prefer investing the $1 to $1.50 that I save on each round and putting that money into more silver which can then exponentially gain value. I look at it like compounding interest, as opposed to only maybe getting the premium back in several years, and which would be worth less then due to inflation over the years. I would rather invest two dollars now, than maybe get two dollars of reduced value back in several years.

But overall I get such good deals on 90%, so it is the majority of my Ag purchases. There will very likely be a premium on it once again like right before Y2K. It is still widely recognized, and most importantly, they are not making any more of it, much was melted, and it is highly divisible for transactions of a bartering nature. Just the other day I sold something for 5 silver quarters....

Re: Why the large premium for Silver Eagles & Maples?
 

Can you suggest a good source for these??

Re: Why the large premium for Silver Eagles & Maples?
 

Junk silver normally trades @ or near spot because it is an alloy. This means that the coins will incurr refining costs to recover the silver they contain.

Not so with Eagles....they are bullion. Specifically they are .9993 pure = 99.93% pure silver = if you want the silver to fabricate some other form just melt them...no refining time or costs are incurred.

Each form of PM has comparative "pros" & "cons". The down-side of an Eagle is it's premium, however many folks believe that the comparatively higher premium is offset by the Eagle's up-side.

And relevent to other modern silver coins, Eagles are to be preferred in the U.S. because they enjoy legal-tender status and everything that that unique property means. In the U.S. IMO, Maple Leafs are a close second followed by Mexican Onza's and later Libertads if you can get Libertads at the same premium, and lastly Philharmonics.

A wise person will focus on degree of liquidity @ trade-out...considering different senerios of the social political environmant range from normal functioning to wide area natural & man-made SHTF stuff.

If TSHTF in the US I don't think Joe 6-pack tradesman will have much awareness of Philharmonics, and even if s/he does, will much prefer 90% US and near the Canadian boarder Can. 80%, Eagles, Maple Leafs, and Onza/Libertads.

Without assay, a person can't now or in the future ever know what the purity of a privately struck round or bar is, and IMO this might well equate to less liquidity.

Re: Why the large premium for Silver Eagles & Maples?
 

In the Western US at least, these two rounds are at most coin shops. Some of the big internet dealers seem to have them regularly, alot of people here like APMEX. I prefer cash and carry and no shipping charges, plus it supports my local dealer and his efforts to provide an important service.

Re: Why the large premium for Silver Eagles & Maples?
 

I fully expect there will be counterfeit ASEs coming out of China, if there aren't already. Very high premiums attract the moneymakers.

I also pick up Onzas and Libertads since I am near the border, and they are sometimes about .40 over spot. They are my favorite govt issued .999, excellent liquidity in my neck of the woods.

I earned my first degree in international economics in the early 80's, and then grad school in international relations and have examined much history from many points of view over the years. I have never seen such a set-up for the perfect storm in the US: Little to no personal savings by many, oil about to be de-coupled from the dollar, massive govt debt, a worn-out military, draconian laws, no food surpluses, weakening infrastructure, and I could go on. All while other countries are on the ascendancy and badly needing resources. That is why I emphasize 90% for myself, it would take very little to create some major chaos in this country. When I was in Poland in the eighties there was a phrase: "A hungry man is an angry man."

Re: Why the large premium for Silver Eagles & Maples?
 

It depends on when that extra $2.00 is paid. The more expensive silver gets, then the more $2.00 is manageable. But then again, the premium is more likely to go up proportionately with the increase in the silver spot price.....:wink:

Re: Why the large premium for Silver Eagles & Maples?
 

The nearest coin shop I know of is 80 miles away, plus I am pretty sure I would get to pay sales tax here in Tennessee which would be greater than any shipping cost.

Re: Why the large premium for Silver Eagles & Maples?
 

I buy online as I too live a long way from anyplace I could buy silver or gold over the counter, I also get out of the tax by doing so.
I don't spend the money paying premimums, to me .999 is .999 and thats all I will buy.
I have a couple 2008 eagles because they are pretty but they are all going to get tossed into the same melt bucket as a 1973 happy birthday round when I sell them so why bother paying more?
Its all getting melted and shipped to china as we speak so buy bulk .999

Re: Why the large premium for Silver Eagles & Maples?
 

the price is starting to mitigate a bit on silver eagles....I picked up a couple today over the counter for $19 and change each, very clean coins as well.....I suspect that the demand bulge is lessening a bit as people become sensitized to the higher price of oil and the credit crisis...the public has a notoriously short memory and will revert back to their old habits as soon as they perceive that a crisis is leveling off (it's not, but that's the public for you)..

eBay is still a bit pricey at $22 on average for SAE's but even there prices appear to be easing a bit as well..

Re: Why the large premium for Silver Eagles & Maples?
 

Was going to say the same thing. More people will accept a maple/SAE/Bar just because it has, "1oz silver" printed on it and it is from a reputable source.

In a SHTF situation, your average joe isn't going to know how much silver is in a 1962. For all they know it contains junk metal like the later quarters.

Your silver is worth nothing if the guy down the street won't buy it.

Re: Why the large premium for Silver Eagles & Maples?
 

This topic has been rehashed here so many times, but HMMM, I guess that is why the premium on 90 % shot up dramatically in the period before Y2K? There were plenty of 'average joes' who demanded it for a possible meltdown situation, and it is in limited supply, especially after all the melting that went on. You didn't see that premium with .999. In addition, most anybody in their mid- forties or above in this country well remembers silver coinage, and that alone is a huge percentage of the population, many of whom are increasingly concerned about the economic future. From personal experience there are already people in this country making transactions amongst themselves using 90%, much harder to do with one ounce rounds. So far I haven't run into any conterfeit 90%, slightly worn and tarnished coins are hard to duplicate! The problems with counterfeit .999 could get worse as Ag prices explode. NONE of the .999 are immune to counterfeiting, including govt issued ones. And as far as people not knowing how much Ag is in a coin, if there is a meltdown there will be a larger # of people using PMs and trading PMs, and it takes a couple of minutes to memorize the amount of Ag in the 90% coins.