Collectors value vs bullion value

[newprepper]

With the volatility of the bullion market in silver, how will silver at $150 oz (fingers crossed) affect the value of an eagle currently values around 100 bucks?

[jayman1970]

The way I see it if silver hits $150 an oz then your $100 silver eagle wold rise in value about $50!

 

 

Jason

[Mr.Mcknowitall]

The way I see it if silver hits $150 an oz then your $100 silver eagle wold rise in value about $50!

 

 

Jason

 

 

Minimum or maximum?

 

Respectfully,

John Curlis

[newprepper]

Then if I understand you correctly, as soon as bullion value exceeds numismatic value the coin ceases to be worth collecting and becomes the same as a raw coin.

[jayman1970]

I think maximum,if a rise in silver prices surpasses the current numismatic value of a coin you would have to value it for its bullion price.

[newprepper]

You don't think the coins would be re-valued with the current bullion price figured in to the numismatic value?

[jayman1970]

Then if I understand you correctly, as soon as bullion value exceeds numismatic value the coin ceases to be worth collecting and becomes the same as a raw coin.

 

 

No,but the price of silver can rise a lot quicker than the numismatic value of a coin,but wont necessarily stay that way.lets say your coin is worth$100 now,and you check silver prices two days from now and silver is at $150 per oz what do you think your coin is worth at that point?

[jayman1970]

You don't think the coins would be re-valued with the current bullion price figured in to the numismatic value?

 

 

If silver stayed at that rate long enough,yes the numismatic value would catch up but I dont think at the same percentage;silver 27 oz,your coin 100=roughly 4times melt , if silver hit $150 oz I dont think your coin would go for 4 times melt at that point

[newprepper]

I agree with your thinking, it would not be overnight but I think there would still be an extra value, not proportional though. There would be a lag.

[jayman1970]

Yes with the way silver goes up and down so fast,the numismatic values dont usually follow that trend!

[DirtyGoldMan]

In general, as bullion prices rise, the price premium of precious metal coins that are tied to bullion value tends to evaporate such that in your hypothetical situation, I would expect the value of the coin to be about $150.

[Bruceswar]

In general, as bullion prices rise, the price premium of precious metal coins that are tied to bullion value tends to evaporate such that in your hypothetical situation, I would expect the value of the coin to be about $150.

 

This is pretty spot on but also there would still be some premium, such as a 1996 eagle. No matter where silver sits, they always sell for more.

[PerryHall]

In general, as bullion prices rise, the price premium of precious metal coins that are tied to bullion value tends to evaporate........

 

As an example I bought a nice MS61 1906-S Liberty double eagle a couple of weeks ago for $1600 in a small ANACS slab which is about melt value. It seems strange to be able to buy an old slabbed U.S. gold coins in a MS grade for a price that's basicly melt.

[mtnstyne]

With the volatility of the bullion market in silver, how will silver at $150 oz (fingers crossed) affect the value of an eagle currently values around 100 bucks?

 

I think reaching $150 ounce in my lifetime is possible but a long ways down the road and I am 41. You will see so many people liquidating their hoards (yes hoards) intermittently on the way up. While I think there is more upside in silver than gold I just don't think that it is going to have a 5X increase. Just

[BillJones]

If silver hits $150 an ounce within the next year, the U.S. dollar won't be worth a bucket of warm spit. If the dollar is that bad, the numismatic value might continue to be there if average citizens are getting raises that make up for inflation. Of course if inflation is that bad, we mught be in the same situaiton as Germany in the early 1920s and then all bets will be off on everything, including domestic tranquility.

 

There are now coins that don't have a numismatic value any more because the increase in bullion prices have overtaken collector interest. Circulated, common date $20 gold pieces lead the list followed by circulated common date Morgan and Peace dollars.

[Houston Investor]

The numismatic premium over melt can vary over time. Case in point common $20 Saints and Libs.

 

Lets say silver reaches $150 and ounce. I would expect the numismatic premium over spot (dollar amount) to remain the same or slightly increase if usually a percentage but in a raging bull market or bear market all bets are off. I know of a number of individuals who are buying anything nice if the premium over melt right now is around $15 or less. This is especially true with slabbed MS / PF 69 issues like a silver commem dollar. I know of one guy who has accumulated hundreds of silver and gold mod commems in this manner.

[Mr.Mcknowitall]

Does the recent recovered sunken silver treasure change speculation on the price of silver,up or down?

 

Is this silver "collector" silver, or considered industrial use, in that it would be melted and used for other purposes?

 

Is the quantity of silver recovered, and that potentially can be recovered, significant to the world supply?

 

Does it change personal opinion about what is a reasonable price for U.S. bullion coins?

 

Respectfully,

John Curlis

[World Colonial]

In addition to collector interest, I believe it is also affordability. A Morgan dollar at $150 silver is going to be far less affordable to the typical collector. I think this is also true of that MS-61 double eagle selling at melt. People either cannot afford it or they are not interested in buying a coin that is not particularly attractive. That is why i would not buy it at that price. There are much better coins available for that money and I would rather own an AGE for bullion because I believe it is more liquid.

 

Eventually silver will hit $150, but I do not believe it will be as soon as the silver bugs. Except for 2008, I have been wrong in my expectations for both metals.

 

If and when this happens, most people are going to be worse off than they are now and the primary driver of coin prices generally is better explained by prosperity than metal prices. I expect most coins to drastically underperform bullion in this scenario, just as they did to my knowledge between 2001 and last year when silver hit $50.

[jackson64]

I think both Bill and World Col touched on my belief. If there is the inevitable devaluing of fiat currency in a future scenario and by consequence silver reaches $150 an ounce--I believe in that scenario we would see a VERY VERY large part of the numismatic collecting market vaporized. We must always remember-Coins values are intrinsically tied to collector demand and what someone is willing to pay for it--period, period, period...

 

I highly doubt in a situation where we would be in a hyper-inflationary period where precious metals are jumping to $150 and say $3000+ for gold that people are going to have a lot of discretionary income for collector coins.

 

In fact I could foresee the opposite. I have read several journals and posts of people here who stretch their budgets thin or even buy high grade coins on credit ( jaw drops here). People who are that close to broke or have that little rainy day money might even be selling those $300 valued silver dollars for bullion ( $150) if it meant eating or keeping the lights on.........just another perspective if we had that type of either: A) devaluing of the dollar or B) an inflationary explosion of commodities

[newprepper]

Just think what that does to the value of all the slabbed coins that do not get cracked under that scenario after the crisis ends.

[Houston Investor]

When silver looked like it would leap past $50 awhile back I did not think $150 was far fetched. But now with it at $27 its tough to be so bullish. Its at times like this when everyone is bearish it may be time to buy. The other day I bought a PCGS 69 mod silver commem dollar for $32 in an ebay auction. Not much downside on that.

[newprepper]

I agree, seems with the value of any slabbed coin being around 50 bucks you can get a few for 65-80% of that

[World Colonial]

In fact I could foresee the opposite. I have read several journals and posts of people here who stretch their budgets thin or even buy high grade coins on credit ( jaw drops here). People who are that close to broke or have that little rainy day money might even be selling those $300 valued silver dollars for bullion ( $150) if it meant eating or keeping the lights on.........just another perspective if we had that type of either: A) devaluing of the dollar or B) an inflationary explosion of commodities

 

I do not know how much forced selling there has been in the last four or five years since the economy worsened, but I expect to hear about a lot more in the future if the economy gets worse as I believe it will.

 

A disproportionate number of people in the United States are flat broke. Tens of millions of them. The question is, how many of them are (or were) coin collectors? I do not know the answer though I have always assumed that the the "typical" collector is better off than the "average" American.