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Thread: What's a normal price for 90% junk silver?

  1. #1

    Default What's a normal price for 90% junk silver?

    I tried to do a search here but it was unsuccessful. So, forgive me, since I'm pretty sure this question was answered on this forum before.

    What is a usual mark up over spot for junk silver, like pre-1965 coins? I've seen some ebay listings for $1000 face value 50lb "bags" of coins. The best priced ones so far are in the range of $12-13.5k per bag.

    These are my calculations:
    - 50lb = 800 regular ounces = 725 troy oz
    - 725 * 90% = 652.5 oz of pure silver in a bag

    taking for example a price of $12,500 per such bag I get $19.15/oz. Am I using the right method here? this in my opinion is not such a great deal, since you can get silver eagles for that money now. What would be a good industry standard markup (or markdown) for that type of silver?

    Also, if need comes to sell it, what options do I have besides putting it back on ebay or using it myself in SHTF scenario? Will refineries take it and what's their cut usually?

    Thank you, guys.

  2. #2

    Default

    Hey.
    Never purchase junk silver "by the pound". Those folks are really just trying to confuse people.

    I highly recommend checking out coinflation.com for updated values of pre 1965 coinage.

    As a general rule, each dollar face value of pre 1965 half dollars, quarters, and dimes contains .715 ounces of silver. Therefore, what you need to do before purchasing is some quick math.

    Face value of coins x .715 = approximate ounces of silver. Multiply that by the current spot price of silver and that is the price you should pay, plus or minus any premium you are willing to accept.

    Right now, for example, a roll of 20 half dollars would be:

    $10 (face value) x .715 (ounce per dollar) = 7.15 ozs of silver x $17.07 (spot price) = $122.05

    Many times, people will use 12x face value as their description for the above example. That of course will fluctuate based on silver price.

    Hope that helps.
    To err is human, to ARGH! is pirate.

  3. #3

    Default

    I hear alot of people on here pay spot or more for 90% junk silver, that sounds foolish (unless in UK). I always find it for at least 5% under spot. I have never payed spot and I refuse to for a couple reasons. If I'm gonna pay spot or more I would get bullion bars, fancy rounds, morgans or peace for $16, fancy 1oz. bars for $1 over spot. It's 90% junk(called junk for a reason) you'll lose more premium selling, shipping prices kill, its a little harder to sell and not quite as liquid or sexy as bullion JMHO. Also you cannot melt it's illegal, but It's still a must and sometimes you find numis coins for an extra little perk
    Last edited by Jamesbong; 03-15-2010 at 04:10 AM.

  4. #4

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    Actually, melting junk silver isn't illegal anymore, but why bother? You've got a know quantity of silver with a face value.

    I think pennies and nickels are now banned from melting.... someone else correct me if I'm wrong....
    To err is human, to ARGH! is pirate.

  5. #5

    Default

    Quote Originally Posted by dreamKchr View Post
    I tried to do a search here but it was unsuccessful. So, forgive me, since I'm pretty sure this question was answered on this forum before.

    What is a usual mark up over spot for junk silver, like pre-1965 coins? I've seen some ebay listings for $1000 face value 50lb "bags" of coins. The best priced ones so far are in the range of $12-13.5k per bag.

    These are my calculations:
    - 50lb = 800 regular ounces = 725 troy oz
    - 725 * 90% = 652.5 oz of pure silver in a bag

    taking for example a price of $12,500 per such bag I get $19.15/oz. Am I using the right method here? this in my opinion is not such a great deal, since you can get silver eagles for that money now. What would be a good industry standard markup (or markdown) for that type of silver?

    Also, if need comes to sell it, what options do I have besides putting it back on ebay or using it myself in SHTF scenario? Will refineries take it and what's their cut usually?

    Thank you, guys.
    When I goto the coin shop, I'll buy silver half dollars from them, 1914-1963 range, so its 90% silver. With silver around $17, he will sell 2 of them for $11.75, 90% silver dimes he will do for 1 for $1.25. Seems like a pretty good deal because the price of pure silver is about $6.15 per half dollar coin when silver is at $17

  6. #6
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    Default

    Quote Originally Posted by Jamesbong View Post
    I hear alot of people on here pay spot or more for 90% junk silver, that sounds foolish (unless in UK). I always find it for at least 5% under spot. I have never payed spot and I refuse to for a couple reasons. If I'm gonna pay spot or more I would get bullion bars, fancy rounds, morgans or peace for $16, fancy 1oz. bars for $1 over spot. It's 90% junk(called junk for a reason) you'll lose more premium selling, shipping prices kill, its a little harder to sell and not quite as liquid or sexy as bullion JMHO. Also you cannot melt it's illegal, but It's still a must and sometimes you find numis coins for an extra little perk
    The premiums for 90% silver coins vary from time to time (just before Y2K, they were quite high!) -- at times you won't be able to find it under spot anywhere. As of a few weeks ago, it wasn't possible to find it under spot in quantity anywhere. Also, remember that you can't buy bullion bars at spot. Right now, you're going to typically be paying a minimum of about $.50 more per ounce for the bars versus coins. The bars provide easier storage, but the coins can't be beat for the scenario people talk about where they could be used as barter.

    The term 'junk' is because the coins have no numismatic value, not because it's a bad form of silver to have. Shipping prices are often the same for 90% versus 99.9%; even though 90% weighs 10% more, USPS has flat-rate shipping that some dealers use.

    As cphine said, melting 90% silver coins is legal. That helps keep the prices up -- when the discount to spot is more than what the refiners charge, arbitrage kicks in, and people buy the bags and sell them to the refiners.

    Of course, different types of silver suit different collectors/investors differently.

  7. #7
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    "Normal" is not a good term to describe prices of Junk Silver- your just gonna look for best price which is hard to find, have known people who rent room next to some of those highly advertised & over rated Gold &PM buyers and offered a little more than they do & did very well; you basically gotta keep eyes open and chase down alota Rabbit trails so to speak before you find a deal here & there- or just get lucky which has happened to me a few times when got some for 1/2 or less Spot.

    But one thing is for sure for me will NOT pay retail or even Spot ever again.

  8. #8

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    Quote Originally Posted by cphine View Post
    Hey.
    Never purchase junk silver "by the pound". Those folks are really just trying to confuse people.


    Face value of coins x .715 = approximate ounces of silver. Multiply that by the current spot price of silver and that is the price you should pay, plus or minus any premium you are willing to accept.
    Actually selling by the pound is much more honest then buying by face value. Selling by face value is confusing and inaccurate given the wear differences of a typical standing liberty and a 1964 Washington. That being said, I have only made one junk purchase by weight. I guess when in rome...

  9. #9

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    The reason to buy and sell by a multiple of face value is that is the language most dealers speak. Buying or selling dealers normally just speak in face value. They never weigh the coins and at this point my dealer does not even count what I bring to him.

    People selling by weight are trying to be confusing on purpose to gain the upper hand.
    “Do or do not... there is no try.” - Yoda

    You have to love Lunar Snake Coins.

  10. #10
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    Quote Originally Posted by GenRipper View Post
    Actually selling by the pound is much more honest then buying by face value.
    There is nothing dishonest in buying/selling by face value; that is just how 90% coins are currently sold. Odd, yes, but true.

    Selling by the pound is almost always a legal scam. Why? Because the buyer usually thinks they are getting 16 ounces, but they are really only getting 12 ounces, and they typically have no recourse against the seller. No precious metals dealers sell by the pound (except those 'Mints' named after presidents, e.g. Franklin and Washington Mints), but a pound of silver is indeed 12 troy ounces.

    I advise people to never buy from a seller of precious metals that sells by the pound.

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