The United States Mint recently announced there will be new reverse designs for the popular Silver and Gold Eagle bullion coins in 2021.
This article is a follow-up to our last blog which discussed the merits of owning physical gold. Both novices and long-time investors stand to benefit from a review of the basics of owning physical silver. The following list contains some, but not all, of the reasons to buy tangible silver. Some items on the list hold true for any precious metal, others are unique to silver.
Government bureaucrats, central bankers, and Wall Street executives all have reasons for ridding the masses of their cash. It should be no surprise to anyone that they are working together to achieve that goal. But why? The self interest of bureaucrats is one factor, they don’t like privacy. They dream of the day when they can access all your financial information with just a few keystrokes. The knowledge will help them more aggressively tax and regulate.
There appears to be a growing war on cash as evidenced by more frequent reports in the mainstream media suggesting central banks and federal governments are supporting the banning of currency (cash) in the foreseeable future. Consumer spending in most developed countries makes up at least 50% of the Gross Domestic Product. However, with sluggish growth at best in most developed countries, the ‘powers that be’ are looking to encourage the populace to spend money rather than save it. Thus the motivation for the war on cash.
Following similar steps already taken in United.States the European Commission recently ordered 11 members of the European Union (EU) to enact the Bank Recovery and Resolution Directive (BRRD). These rules theoretically aim to shield taxpayers from the fall out of another banking crisis similar to the recent fiascoes in Cyprus and Greece. The BRRD mandates that if a future banking crisis develops governments will not be obligated to prop up the banks. At any rate most countries are so far in debt that they would not have sufficient assets to bail out even a small regional bank. Instead the burden will be put on creditors and depositors to bail-in their troubled bank. In simple terms legislating bank bail-ins aims to remove government responsibility when a bank fails. This news was not covered by a vast majority of mainstream media outlets despite the serious risks and ramifications for depositors and savers in the United States, throughout the EU, and internationally (i.e. Canada, New Zealand, et al).
The most frequent question asked of us here at JHCB by the public goes something like this… “What’s a better buy, silver or gold?” Our simplistic answer is a polite “We don’t really know”, or a similar non-committal response usually followed up with our question for you… “Why are you buying precious metals?” We’ve found over the years that our precious metals customers can be separated into two categories. The first group are those looking to make a long term profit buying low and hopefully selling high several years down the road. Our second category of buyers want tangible metals to act as an ‘insurance policy’ against weakening paper based assets.
Many of our wholesale and retail customers are unaware that Jack Hunt Coin Broker (now known locally as Jack Hunt Gold & Silver) once produced and marketed 100 oz. silver bars. It has come to our attention recently that there are some who mistakenly believe that these bars are a rare collectors item, produced by the infamous Hunt brothers (no relation to Jack).
Recently on more than one occasion I have come across bloggers essentially claiming that United States Mint is failing in its legal mandate to meet domestic investor demand for Silver Eagles. They argue that this especially holds true when market factors lead to significant increases in demand. Arguments range from poor management to nefarious intent to drive up Silver Eagle prices. As one of only twelve organizations worldwide that can buy Silver Eagles directly from the U.S. Mint, Jack Hunt Coin Broker has a clear picture of both the supply and demand issues involved with Silver Eagles. There are numerous reasons, that work individually and/or in conjunction that sometimes affects Silver Eagle supply. Consider the following: