Should I stop stacking silver?

Should I shift a significant portion to Gold?

I am new to PM and got bit by the silver bug but several recent supply articles are making me rethink.

I am not a doomsday person or an economic collapse person. I respect it can happen but those are much further down my list. My main reasons.

1. Silver is consumable and becoming scarce. Article after article and YouTube videos showed this. Had not seen any recycle videos. I now know that there is a lot of recycling. I think some of the bars out there like to show their green side and tout recycled material.

2. Silver to gold ratio out of historical line. A material becoming more scarce will get in line but what about some that is over supplied and has closed mines.

3. Legacy. Think about if someone left you 1,000 or 2,000 or 5,000 silver coins. The flip side think if someone left you 20 or 30 one ounce gold coins. Pretty cool person either way.

4. The ASE is just beautiful

5. Cool world coins that are affordable

I still plan to pick up 10 world coins per year but thinking of only doing a single tube of ASE and then shifting to gold.

My three questions

1. Should I be talked out of this? Is there something to be sad about future scarcity?
2. What percentage mix do those who split their PM purchases between gold and silver employ?
3. What size coins do you like? Save up for an ounce or go fractional? How would you ideally split up on a percentage basis not considering cost ex. 25% 1 ounce 25% half ounce etc etc
2.

 

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Silver is the opposite of scarce. More people than ever have rolls, bags, bars, and monster boxes of it in their basements or safe deposit boxes.

From the legacy perspective you have good intentions and I would like to do the same thing. But I would caution you to look at historical mintage charts of silver and gold eagles before buying.

Fifty years from now the 2011, 2012, and 2013 bullion eagles will be the equivalent of a 1921 Morgan Dollar. Not a bad coin or something that your ancestors wouldn't appreciate, but just extremely common.

There are options out there that will cost substantially more but would give you the benefit of both bullion value and some numismatic value.

Or if you insist on buying bullion, at least buy the 5 oz. ATB pucks which will not have huge mintages like the silver eagles.

 

Thanks for the heads up on the ATB.
I see these can be purchased from the US Mint for $154 per however I am seeing prices of $123 for the same puck from online sites that I have bought from before.

Why such a price difference? Is the drop in Silver the reason? I would think the the retailers would have bought for more than $123.

Where do you get your ATB?

 

I've been getting them from three primary places: Apmex, Aydin, and an occasional buy from eBay when I can capture one at a good price.

 

Buy the ATB from the mint you get a mint mark. Online retailers its Bullion.

The US Mint says 25,000. Does this include the mint mark and bullion?

Is the Mint mark worth an extra $30 from a long term value stand point

 

There is a surplus. One of the biggest uses (photography) is in decline. If you thought otherwise, then you let yourself get misled. Stay away from the youtube.

 

The 25,000 is with the mint mark. The bullion will be more than that this year, but not that many more. Last year they were in the 20,000 - 25,000 mintage range. This year with cheaper silver maybe they will hit 100,000.

Even if they do hit 100,000 compare the potential of those to the potential of a 2013 bullion silver eagle where they will mint 40 million plus.

Time will tell if the mintmark is worth the premium.

I have not bought any yet. I almost pulled the trigger on Hawaii and regret not doing it because those are selling for big premiums. I am planning to get both versions of Mt. Rushmore later this year.

 

I historically have only bought silver. However, I am moving more into gold. I just bought two eagles last weekend, and bought a double eagle a month ago. I am buying them because:

1. I wanted these coins for a while
2. I am simply running out of room in my SDB. I have the largest they offer, but after a 2012 ASE set, about 1000 ounces of silver, and about 12 boxes fill of ancient and US coins, I do not have much room left. Plus, its getting pretty dang heavy.

I am not sure I want to be one of those "I have 6 sdb's full" kind of guys. Kind of reminds me too much of a hoarder. So, I am buying some silver as I want the coins, but intentionally only putting money into gold right now. I have a nice St Gauden's $20 and $10, and an earlier $10 right now. I am thinking of buying 5-10 more US gold coins, and maybe 10-20 world gold coins I have always wanted over the next few years. Kind of pent up demand, since I was too cheap to buy when gold was $1600+. After that, maybe some platinum. You never know though, things come up, tastes change, etc.

OP, its difficult for me to tell you to stop buying silver, since I am doing so with some silver already owned. However, just like PM is a good play because it adds diversity, a little diversity in PM holdings wouldn't either, right?

 

Yes, and photography is double wammy since that was basically unrecoverable silver. So we have less silver going into the abyss. The biggest gainer for silver use was medals and coins. That on the other hand is 100% easily recoverable. No matter how you slice it, there are gobs of Silver around.

 

The mint had to shut down production on ASE a year ago. I am assuming that they can't use recycled silver and need it mined.

Going back to Gold Eagles. In terms of seeing the detail and the actual feel of the coin is the 1/10 oz even worth it. It looks the size of a dime. Do you get a much different feel going to the quarter oz or is it necessary to just save up for the half or larger?

I like the collection aspect so I want to be able to appreciate the look, feel and detail

 

Well Westtexas, responding to your original post: You need to make your own decision. It sounds like you are following the PM market enough as of lately. You can simplify the decision a lot. Decide whether you are going to invest for the short term or long term. then decide which metal you think will perform the best in that time frame. This forum is full of PM experts (including myself) who can't tell you what gold or silver will do in the next three days, months, or years. Make an informed decision; reward yourself when you guessed right, and learn from your mistakes when you didn't.

 

If you like the look and feel of coins, why not buy real US gold? That is what I did, buying a real St Gaudens instead of a AGE. If you "collect" your bullion you get much greater returns. Happiness is worth a lot to me.

 

I will say this, I love collecting silver and wish i had the money for gold. However, in my naive opinion, i see gold and silver both going down even more with the slow economic recover and the likely end of QE. I don't think now is the time to be jumping in. Its one thing to collect for numismatic value, but if you are just stacking, I would wait.

 

The quarter eagle feels far more substantial than the 1/10th eagle. It's a nice compromise if you can't make the leap to the larger denominations. It's worth noting, though, that the smaller the denomination, the greater the margin you'll pay over spot. So if you're treating gold as a collectible, that may be fine for you, but if you're treating gold as a bullion investment, it makes sense to set aside enough cash to buy the largest denomination you can afford.

That said, it's never exactly easy to set aside $1300 - $1500 for a coin. The financial guys will beg to differ, but I think it makes perfect sense to pick up 1/10th or 1/4th denominations of gold with the intent to consolidate in the future into larger denominations. It gives you an entry point into the metal and allows most of us to dollar cost average more frequently than what we might otherwise be able to do.

 

Solar panels use a substantial amount of silver in their production, and have the potential to replace the industrial loss of photography. That said, the fallout/consolidation in the solar markets in recent years has created a slump in demand, and the silver from those panels are easily recoverable when they've reached the end of their useful life.

 

If silver goes up, solar panel manufacturers will use less silver to save costs.

 

The time to have gotten in to both PM's was a few years ago. You have to know when the getting is good, like it was a decade to about seven years ago. In essence PMs are nothing more than a longterm insurance policy - not an investment. I look at PM's as a form of wealth preservation - not an investment.

 

Look at the GSR, (gold silver ratio) It's pretty high right now about 66, which means you should concentrate on mainly silver in my opinion.

 

Or it could mean that gold is due for further correction.

 

I wouldn't pay much attention to the GSR. There is never a guarantee the ratio will return to what anyone would consider correct. I mean would any one really recommend buying Rhodium because the Rhodium\Gold ratio is now very good?

In addition, as Jim pointed out, even if you believe the ratio has merit, there is no way to tell if the ratio is telling you that one commodity is undervalued or the other one is over valued.

The Gold Market and the Silver market are two separate markets with different drivers and should be treated as such.