Why purchase silver coins?

Silver is knows as the "poor mans gold". It may be because it is so much cheaper per ounce to buy silver than gold. One thousand dollars will buy about 63 ounces of silver compaired to one ounce of gold (with the current price of silver at $15 and gold at about $950).

While you may have more ounces, you would not have more value, but the weight still infuences people because of the appearance that they are getting more for their money. This is only an appearance, and may be amateurish, but is a factor in the volatility of the price of silver none the less.

Because of this appearance that one gets more for his money with silver than he does with gold, when the general populace is fearful that the dollar is loosing it's purchasing power, they will rush into silver. This causes a volatility that gives silver more potential upside than gold. It is more critical to buy and sell silver at the precise time than it is for gold, even though gold can be volatile as well.

As for the type of coin to buy, there are bags of old American coins commonly available for purchase. They come in denominations of 10 cents, 25 cents, 50 cents and one dollar coins. These are known as "junk silver" because they are not really rare. These coins are 90% silver with 10% other metal to survive the rigors of circulation. They were made up until 1964 by the United States Government.

They are good because they are easily recognizable and are trustworthy because they have been minted by the US Government. There is not much of a chance of these being a copper coin that has a thin layer of silver, which would be counterfeit and not worth an authentic 90% silver coin.

There are also pure silver rounds made of 999% silver. These are made by various mints around the country. The US Government does have rounds for sale as well called "American Eagles". Canada has the "Maple Leaf" and other countries have various coins in gold or silver of the approximate weight of an ounce.

Buying "junk silver" is good because it is easy to recognize and is trustworthy. The down side is that when you buy it, there is a "premium" or added cost and when you sell it, there is a "discount" or lower price paid. The "spot" price of silver in the market changes with the economy but the "premium" or "discount" above or below the "spot" price, changes with the demand.

This is true of 999% silver rounds as well, but the "premium" is more costly with "junk silver". 999% silver is already refined to pure silver while "junk silver" is bought only for the pre-refined silver value. The cost of refining the silver to 999% silver from the 90% silver is charged to the seller. The buyer will only pay for the value of the silver.

The best reason to buy silver coins is for protection of your purchasing power against the collapse of the dollar. The more paper dollars they print, the less each one is worth. The less each dollar is worth, the more each ounce of silver or gold is worth and that's why you should purchase silver coins.

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Purchase Silver Coin, Copyright 2009