Silver Investing - It's Not About America Anymore

For the last couple of decades, the primary driver of the price of precious metals has been the value of the U.S. dollar. On days when the dollar moves up against other major currencies, the price of precious metals moves down. On days when the dollar moves down against other major currencies, the price of precious metals moves up. This inverse relationship exists because all precious metals are denominated in U.S. dollars, and because there hasn't been a lot going on the last two decades that would cause people to put their money into precious metals instead of the U.S. dollar. Owning the dollar has been more desirable than owning gold or silver by most because U.S. bonds pay interest. Not only does owning physical gold and silver not pay, it costs to store and insure.

That may have all changed on November 30, 2010. The markets opened lower on European debt fears. Ireland got its bailout. But now Portugal and Spain are a concern. Out of habit, money flowed into the dollar, pushing it up about one percent against the euro. But an unusual thing happened simultaneously; the price of gold and silver, in U.S. dollars, moved up too. Instead of moving opposite the dollar as usual, gold and silver moved the same direction. At one point midday, the price of gold was up 1.3% despite the dollar being up about 1%. At that same time, the price of silver was up 3.9%, three times the percentage increase of gold.

Why did the price of silver and gold move up despite the rising dollar? A number of European investors put their money into precious metals instead of the dollar. That's why. They are losing faith in the dollar. They, as I, would rather pay to own silver that be paid to own dollars. Because the gold market is tiny compared to the global bond markets, it doesn't take a very large percentage of the available capital moving from bonds to gold to affect the price of gold. And the silver market is a tiny fraction the size of the gold market.

Add to this the fact that despite our huge economy and tremendous disposable income, Americans only account for about 20% of the precious metals purchases the last few years. We Americans tend to analyze investments within the context of the American economy and values. But in precious metals, America does not dominate.

Gold, in U.S. dollars, was $35 below its all-time high today. Silver was a similar percentage below its recent 2010 high in U.S. dollars. But in Euros, gold made a new all time high.

It seems that Quantitative Easing, compliments of the Fed, has delayed the day of reckoning for the U.S. and its debt crisis. Which means it will be a while longer before many Americans begin to wake up to the fact that their dollars are on the way to devaluation. As the debt crisis unfolds in Europe, depend on Europeans to drive the price of silver higher, even in the face of a strengthening U.S. dollar. Then, when the dollar begins to weaken, the weakening dollar will continue to drive the price of silver.

Learn how to protect yourself against the current (and impending) economic disaster with silver investing. For more information: http://www.esilverinvesting.com

Silver Investing - Morgan Silver Dollars

The Morgan Silver Dollar - A Brief History

No other U. S. silver coin can compare with the rich history enjoyed by the Morgan silver dollar (also known as the Liberty Head silver dollar). Designed by George T. Morgan, the Morgan dollar remains a favorite of both casual and serious coin collectors.

A total of five U. S. Mints were involved in the production of Morgan silver dollars from 1878 thru 1921: Carson City; Denver (1921 only); New Orleans; Philadelphia; and San Francisco.

Minting of the Morgan dollar was suspended in 1904 due a government shortage of silver bullion. Only about 8,812,000 (a relatively small mintage) were produced that year. It was another 17 years before another Morgan silver dollar was minted. In 1921, production resumed but later that year the Morgan dollar was replaced by the Peace silver dollar.

The world would be awash in Morgan silver dollars except for two events: 1) the Pittman Act of 1918 permitted the melting of 270,232,722 Morgans for their silver content; and, 2) unknown millions more were turned in and melted when silver reached an all time high of $50.50 per ounce in 1980. So the number of Morgan dollars in existence are far less than the number minted.

The Morgan Silver Dollar - Facts and Details

The Morgan silver dollar features the head of Lady Liberty on the obverse side and a spread-winged eagle on the reverse. Several small variations were made to this coin over its mint life. The mint mark is toward the bottom on the reverse side (just below the ribbon loops). Mint marks are "CC" for Carson City, "D" for Denver, "O" for New Orleans and "S" for the San Francisco Mints. If no mint mark appears, it was minted in Philadelphia.

Morgan silver dollars are 90% silver and 10% copper. Uncirculated Morgans contain .7734 Troy ounces of pure silver (24.0566 grams) with a gross weight of .859 Troy ounces (26.728 grams). Circulated Morgans are considered to contain .7650 Troy ounces of pure silver due to the "wear factor" in handling these coins (sometimes referred to as trade content). Circulated silver coins (including Morgan silver dollars) have been given the unworthy name "junk" silver.

If you are looking for the least expensive way of owning Morgan silver dollars and still get good coins, stay with the circulated grades of Extremely Fine (EF or XF) or About Uncirculated (AU). Uncirculated coins begin with Mint State 60 (MS60) and go to top-of-the-line MS65s. Use caution when investing in MS63 and higher grades - they should be graded and "slabbed" by either NGC or PCGS.

Stay with reputable dealers. And be sure to shop around - don't buy from the first dealer you find that sells Morgan dollars. Prices can vary widely and you will want to compare prices from several dealers to get the maximum amount of silver for your money.

Disclaimer: I have made every reasonable effort to produce an informative and helpful article on Morgan silver dollars based on my research and experiences. However, I make no representation or warranties of any kind with regard to its completeness, accuracy or suitability for any specific situation or purpose.

Copyright © 2008 Silver Investing Simplified - Morgan Silver Dollars

John Ausiman was a salesman of gold and silver for one of the oldest, most reputable precious metals dealers in the U.S. He no longer is actively selling precious metals but wants to share his expertise with would-be gold and silver investors. You will find this complete article (with pictures) and other useful articles on silver at his web site http://www.silverinvestingsimplified.com

Silver Investing - Soon to Become Simpler and More Profitable?

Anyone who has followed silver closely the last few years has probably read of the alleged manipulation of the price of silver. Investigators claim that JP Morgan has been responsible since March of 2008. It was in March of 2008 that JP Morgan took over the failed Bear Stearns bank at the request of the U.S. government. So, JP Morgan inherited the massive short position from Bear Stearns. On the very day Bear Stearns failed, silver hit a multi-decade high of $21 per ounce. Those within the silver investing community who knew of Bear Stearns' huge short position had high hopes that JP Morgan would dissolve the massive short position and let the price of silver find its free-market price level. The expectation is that, in a market free of manipulation, the price of silver would eventually move back in line with its long-time ratio of 1/15th to 1/20th the price of gold.

But it didn't happen. Shortly after the takeover by JP Morgan, the price of silver pulled back - and pulled back dramatically. It pulled back from a high of $20.92 (London) March 17, 2008 to a low of $9.17 in Nov 2008. that is a 56% pullback. Gold also pulled back from an intermediate high of $1,011 in March of 2008, to a low of $713 in November; a pullback of only 29%.

Why the disparity? The serious silver investing community hypothesized that the government had "encouraged" JP Morgan to maintain the massive short position. A few cried foul, but nobody was listening at the time. Why would the government encourage a manipulative short position be maintained? Here is one thought; the economy was (and still is) in trouble. Silver is an industrial metal in high demand, but in short supply. A return to the long-time historical gold-to-silver price ratio of about 17-to-1 would increase the production cost, and therefore sales price, of a wide variety of products manufactured in the United States.

However, just this past week, JP Morgan announced that it will be closing its proprietary commodities trading desks. And last Thursday the price of silver again hit $21 an ounce. As the twenty commodities traders are laid off and operations shut down over the next few months, will the short positions in silver be covered? Nobody knows for sure (except maybe a couple of people at JP Morgan). But given the one-week 5% rise of the price of silver, some of us silver investing addicts, including yours truly, are making small bets that the short positions will be covered.

If JP doesn't try to push the price of silver down in the next four weeks, I would take that as a very good sign that the short positions will be phased out. And then I would consider raising my bet. With silver hitting $21 and gold hitting $1,280 last week, it still takes 61 ounces of silver to buy an ounce of gold. that is still almost four times the historical average.

Some precious metals analysts are predicting a pullback in the price of gold; to perhaps as low as $1,050 an ounce. However, if gold does pull back to $1,050 an ounce, a historical 17-to-1 ratio of the price of gold to the price of silver would put the price of silver at about $62 an ounce.

Learn how to protect yourself against the current (and impending) economic disaster with silver investing. For more information: esilverinvesting.com

Gold Or Silver Investment

Investments in precious metals have always been popular among people. And there is nothing weird since this type of investment is considered to be one of the safest possible options. The other great advantage that can not be disregarded is stability. Basically speaking, due to the number of benefits more and more people all over the world are considering this investment choice. And here comes the other questions: Which of the precious metals you should invest in? It goes without saying that gold and silver are the most popular variants. So, which one to choose - gold or silver investment?

The following information will help you to make this choice.

To begin with it should be pointed out that silver formed proportional raiser that was almost always higher than the one created by gold. In addition, the cost of silver increased in 3 - 4 times while cost of gold doubled. To go into more details there is a need to add that it is a historical fact that the cost of silver has been significantly rising every time the dollar rates dropped.

The other important aspect to take into consideration is that silver was more frequently used for industrial purposes and consequently this strengthened its value. For example, this metal is used in plastic industry, photography, digital cameras, laptops, coin minting, and so on.

Besides, there is one more important plus of silver as an investment option. I am talking here about its affordability if compared to gold which is usually bought by rich people.

As you can see, all the things mentioned make silver a really great and safe investment. But, at the same time, you should understand that is not reasonable to neglect investment in gold. And if you want to diversify your investment portfolio both metals discussed should be included. This will be the wisest decision for you to make.

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