Question: Why are "Junk U.S Silver Coins" on Ebay alway valued as more than the current Silver Price

For example, some listings for an ounce of junk coins silver are trading for about $23, but when I use Coinflation to check the worth in Silver, it's about double. Why is that?

 

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Ignorance?
Greed?

 

The thing is these are auction. People are paying for it. Is it worth it? I mean, even the American Liberty coins for 1oz sell for $21 right now instead of 13? Even right through the Jmbullion.

 

Folks are selling at replacement cost right now and replacement cost is not spot. The market was turned on its ear last week. It will right itself after this crisis passes.

 

Because coinflation is using the paper price and that's not what you can expect to pay, physical demand is going to outpace supply so the premiums will go up. Consider it the street price.

 

Makes you wonder why derivatives based on gold/silver are even permitted; reminds me of the Bretton Woods Fallacy that the dollar was convertible into gold until, OOPS, it wasn't.

 

The answers to your question!

 

Also many sellers are listing the total weight of the coins rather than the actual silver content. Run away quickly.

 

Granted there are many rip-offs on eBay. For junk silver, I find that auctions are the way to go, not Buy it Now. You will find that larger lots of coins will sell closer to spot. I'm referring to rolls of silver coins or lots that are worth several hundred dollars.

But, you may be bidding against people who are not so concerned with the current spot price of silver - they assume it will go higher in the short-term so they want to "lock in" a "good" price now.

Knowledge is power - Buyer Beware!

 

I would think the numismatic value of the coins are factored in? I think maybe if you sell them coin-by-coin, the return will surpass what you pay/ounce. When I first decided to "collect" (for real), I bought several rolls of silver quarters as a "jump start". Some were good, some not so good. But I think the numismatic value of all of them looked at as individual coins exceeded what I paid for them. CSN is selling "silver hoard" at $399/lb ($25/oz) - obviously Mike runs to the LC catalog for references prices; but I believe that numismatically speaking, the value exceeds $399. Just my 2 cents

 

ebay does not sell for free

 

Basically nothing gets bought at spot so can forget that. Then there's selling fees and "free" shipping.

That doesnt even get into the whole what series is it, what do they look like etc.

 

The seller can list for whatever they feel like. As the buyer, you have a choice. Place a bid, buy it or run in the opposite direction.

 

Agreed - the standard ounce / pound offers on eBay and elsewhere just confuse the issue - silver is measured in troy ounces (31.1 grams).
$1 of face value (ten dimes, four quarters or two halves) weigh ~ 25 grams, 90% of which is actual silver (~22.5 grams) - those $1 face value of circulated coins contain a bit less than .72 troy ounces of silver.
Using $14.50 spot price. .72 x $14.50 = $10.44, the actual value per $1 of face value - a 5% premium plus another 6% sales tax will increase your cost to approx. $11.58 per every ten dimes, four quarters or two halves. Use the $11.58* as a baseline for the current market ( the premium is about 2-3% in 'normal times').
A quarter pound of 90% silver coins contains about 3.6 troy ounces of silver, so the baseline for buying that offer should be around $41.70*. - anything more is a serious ripoff - beware!
*I'm including 5% premium and 6% tax, but not shipping - that is extra and should be factored in accordingly.

Avoid the offers like this - they're overpriced and this one also includes a large quantity of 35% silver war nickels:

DISCOUNTED PRICING!!! Lot US Junk Silver Coins 1/4 Pound LB 4 OZ. Pre-1965 Dates

“3 Washington quarters 90%10 Roosevelt/Mercury dimes 90%14 Silver War Nickels 1942-1945 35%”

Price:
US $68.77

 

JP Morgan Chase has been playing the silver market to (its) perfection ever since the 2008 financial debacle - it's a long read, but this article describes the tactics that JPMC uses to acquire millions of troy ounces of silver bullion at low prices to its benefit:
http://silverseek.com/commentary/genius-jpmorgan-17823

 

Here we go with this

 

I think "longarm" has it right: paper prices and the price you have to pay for physical silver have decoupled. I would add that U.S., coinage is particularly good because we recognize it and know what we are getting.

 

They are marked up at cost plus to allow the seller some profit after fees and shipping. Just normal retail business.

One has to do their homework, calculate BV and then analyze the deal.

 

Lots of factors. Sellers build in there acquisition and selling cost. Selling alone is around 15 % Many are professional sellers with other overhead. The market will accept a higher price point on ebay as many feel comfortable and its easy to buy on ebay it is very low risk. If your selective and use a cash back card linked to pay pal you can get decent silver deals but as a rule its more expensive then ampex direct.