Who's Buying Silver???

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Folks,

Silver has fallen quite a bit in the last little while.  When it dipped under $20, I decided to buy about 20oz.  It is my first time buying.  So, I ended up getting it online as my local dealer hadn't responded to my email (I live in Newfoundland so there's only one I know of).  The shipping wasn't bad.  And there wasn't really any extra charge besides the shipping.  I'm told the bank charges a high premium, and they all looked at me with a strange face when I asked about silver.  It seems in Newfoundland, nobody is selling silver bullion...

In any event, I find around twenty an ounce is a reasonable price.  My curiousity is that when spot is $20, people usually add 10% - 15% to this.  So you pay more than spot, because people make money.  If silver hits $40 again, or higher, are people more likely to sell below spot?  Or do they still add a premium?  I imagine that less people are buying when prices are high, so it's harder to sell then, and people would be blowing it out below spot (especially if you are like me and buy when it's less than twenty an ounce).  Does anybody have any thoughts on this for a newbie at collecting silver?

Thanks in advance,

RJB

You are always going to pay a premium for silver and that amount will vary by dealer, bank/ or suppliers like Kitco for example ....the amount you buy, the type of silver you buy (ie rounds/maples/bars etc)
Sometimes more recognized names go for more ie Englhart or JM for instance...
Even when silver was at $40 an oz dealers were still charging a premium and there were times when you still couldn't get any...alot has to do with what they paid for what they have in stock....there are a lot of variables ...

In my opinion... silver going up to $40 an ounce was due to ETF's and "paper silver" demand driving up the price.

There has been a correction now with silver... I actually believe silver at 18 -22  per oz is where the market price will be at for awhile..

With respect to premiums dealers always will have to sell at spot with a premium... they have to make a couple bucks (hence why you can't buy bullion with credit cards the price the credit cards charge for the transaction alone cuts into the dealers profits too much) and you still have to pay for the transportation and some shop expenses...

I try to keep total premiums and shipping (if it needs to be shipped) to under 3.00 plus spot...

Personally I'm a bigger fan of coins with silver content... such as the beloved newfie 50 cent piece... silver dollars U.S. and Canadian.... I try to get the coins for around melt value... and it's always a great treat to pick up a silver dollar at melt and have it graded MS 62 or better..

Silver buyers beware.   Definitely go to a reputable dealer, if you are buying silver.  If it is too good to be true....you could end up with fake silver bars.  The weight and color look the same, and the fakes look good to a novice silver buyer.  You could end up having a worthless paperweight.

http://www.aliexpress.com/item/Johnson-Matthey-Silver-clad-Bar-free-shipping-newest-design-50pcs-lot-non-magentic-Brass-999-Silver/912931228.html?cn=null&PID=1717176&tp1=null&tracelog=null&src=ale&URL=http%3A%2F%2Fwww.aliexpress.com%2Fitem%2FJohnson-Matthey-Silver-clad-Bar-free-shipping-newest-design-50pcs-lot-non-magentic-Brass-999-Silver%2F912931228.html&cv=10986476&af=cj_1717176&vd=30

http://www.aliexpress.com/item/MIX-4-kinds-different-brass-silver-bar-DHL-100pcs-lot-free-shipping-non-magnetic-Engelhard-America/1162626127.html?PID=1717176&cv=10986476&cn=null&tp1=null&tracelog=null&src=ale&URL=http%3A%2F%2Fwww.aliexpress.com%2Fitem%2FMIX-4-kinds-different-brass-silver-bar-DHL-100pcs-lot-free-shipping-non-magnetic-Engelhard-America%2F1162626127.html&af=cj_1717176&vd=30

I purchased a few bars from Canadian BBB certified SilverGoldBull.com.  I got three Johnson Mathey 1oz bars with serial numbers, but I thought it kind of strange that my NTR metals 10oz bar had no serial.  Is this something I should investigate further?  You kind of have me worried now.  I never really thought it'd be something I'd be concerned with.

I always buy from CanadianPMX b/c they're close to me. They ultrasound all their bars.

They charge $5 over spot for Silver. While that's a tad high, id rather pay a dollar or two more, than to end up with nothing.


Btw... recent NTR bars ive seen don't have serials. One way to test a bar (works better on bigger bars) is to do the "ping" test. Put the bar on the edge of a table so that approx half the bar is suspended in the air. get a screwdriver or something metal and tap the suspended part. You should hear a very crisp high pitched ping.

My hearing is pretty much shot...

The above poster had purchased their silver from a pretty reputable dealer... I wouldn't worry so much...

But if you're going to purchase silver from an average joe.. I like to get pics before hand a research the bar/coin in question.. get the right specs.. weight, height length, diameter and thickness before I go to make the purchase...

Also as of late... I have found a great scale that goes to 3 decimal places and I use a very simple specific gravity test


Another thing about shipping and additional costs.. just remember you should factor those into your total cost of the silver so you know what price silver needs to be for you to be profitable..

A fellow here in town was showing me his last few buy and sell points and couldn't understand why he was still at a marginal loss over the long term..

Nobody I know will sell below spot.... in fact, on silver oz coins you add at least a dollar fifty premium...

As for Wizard1 there is another way to test silver bars... take a strong magnet and slide it down the bar (use gravity), it will induce a current in the silver and slowly drag downward... salted bars are very rare too, I bought a 100oz delta mint bar that had a hairline crack in it.. it's a bar few people would have confidence in but I am not worried, it was minted in toronto over a 100 years ago... the metallurgy was not what it is today....

Ive been buying as of late. Good pricing atm.

The simplest way to buy silver is through the NYSE ( New York Stock Exchange ).
You buy the iShares Silver Trust ETF under the symbol SLV. It trades in US dollars.
You don't pay any premium to buy or sell. There is no dealer involved.
No shipping or storage fees required. You don't have to worry if your silver bar is real or fake.
You can purchase SLV through a discount brokerage, so you will have to pay a small commission.
It is usually $5 - $10. There is also an 0.50% annual MER fee for the ETF.
Liquidity is high, so you can buy and sell as many shares as you like.

If I buy anything I want to be able to hold it in my hand...not a piece of paper that says I have something...Anyone have the problem as well

Financial Critics like Bix Weir, Harvey Organ, Rob Kirby, Alasdair Macleod, etc. Argue that the GLD and SLV do not have much bullion backing their shares outstanding due to their convoluted fractional reserve system, bullion leasing, and rehypothication of bullion in their inventory. Also Both GLD and SLV require a minimum threshold of $100,000 IF and only IF the fund managers approve the delivery in Bullion.
Same with the Comex, standing for delivery may not get you your bullion since the COMEX changed the rules that they can make you settle in cash and not the physical gold or silver bullion. I suspect a physical bullion short squeeze in the real market, there is a shortage of American silver Eagles and Canadian Maple leafs due to the recent plunge in prices. With the blessing of the FED and the US Govt JP Morgan has been dumping tons of naked shorts suppressing the PM futures markets prices lower than it cost to pull it out of the ground. The US is trying to protect the US Dollar because Silver and gold is a competing currency. Silver is cheap and I've been buying. There is nothing like holding real Gold and silver in your hot hands.

You can buy Royal Canadian Mint ETRs for Gold and Silver. These are backed by actual physical deposits IIRC.

Trades on TSX : MNT (GOLD) & MNS (Silver)

Actual Official Info here: http://www.reserves.mint.ca/