Monday, October 03, 2011

Silver at $30, Am I buying?

It looks pretty obvious that after two crashes $30ish is the new floor for silver and as such it is an excellent time to buy. Unfortunately for Canadians our dollar has taken a shit kicking over the last couple weeks so today’s silver sale is a little less sweet than it should be. (With a lower price and a higher currency Americans should definitely be jumping back in with both feet.)

What I can’t understand is the flood of money from the Euro to the U.S. dollar. That’s really akin to changing your cruise booking from the Titanic to the Lusitania, either way you’ll end up taking a bath. Regardless of reality, the trend toward the U.S. dollar and weakening commodities will continue to hurt the Loonie until such time as something major and disastrous hits the U.S. market, BOA failing perhaps? All we can do for now is ride it out.

So in answer to an email that asked if I'm buying? Hell yes!

But what to buy?

At the beginning of my silver investing I was overly concerned about the premiums on small bars and ended up with two many large bars, mostly 100s added to the junk I had already collected. While logical in that I was getting the most for my money I believed and still believe that fiat currency is destined to be destroyed and that silver and gold would once again be circulated as real money, in that situation the big bars I have aren’t very practical. Face it, when silver goes up to $200 dollars an ounce it’s going to damn hard to break a 100 ounce bar at Tim Horton’s or barter at the farmers market with a Kilo of silver.

With this in mind I’ve been focusing my purchases on smaller and infinitely more practical 5 and 10 oz bars as well as many 1 oz rounds which were generally the smallest sized silver you could find. Recently however a wide range of smaller sized pieces have been coming to market including ½ ounce rounds, 5g, 10g, ¼ oz and ½ oz bars from NorthWest Territorial Mint, both in their own brand and for Pan-American Silver. At this time the premiums on these tiny bars are quite high making an ounce of silver in ¼ oz bar form just shy of $48 us, or the ½ bars $36.66/ounce vs a full ounce round at $34.33. For Canadians there is also the issue of cross boarding shipping combined with the possibility of wrongly assigned duty because people don’t know their jobs. Curious if anyone else had new products I also checked out first Majestic Silver who now have their own ½ round (also from NWT Mint) at $35/ounce. Available in a previously hard to find size, under a 5 dollar premium, in country and quite pretty too, This is what I’m buying!

Added Oct 11

Ok I have recieved my 1/2 oz rounds last week and they are nice enough that I've reordered the maximum 10 rolls, plus some more 1oz rounds. I wish First Majestic Silver had an associate plan of some sort, I'd proudly sell these.


CDN (Jeff) said...

Check out gatewest in Winnipeg, I have had very good luck with 3 orders so far

Anonymous said...

So society is going to collapse but there will still be tim hortons and farmers markets? Sweet.

canadian silverbug said...

It doens't matter if you are shopping at Tim Horton's and farmers markets or buying black market gasoline, hookers, food or weapons you need appropriately sized pieces of monetary metal..

Not all investors accept the total meltdown scenerio but for those who do, having 1oz or 1/2 oz pieces is ultimately more pratical than gold eagles or a 100 oz bar of silver.

Anonymous said...

I've found a great site to buy from in Canada but have never sold silver. What is your suggestion for the best place to sell for the best price? Online to a dealer? Ebay? Local shop?

Jay @ Sunnah Money said...

I had noticed that APMEX had their own branded 1/2, 1/4 and 1/10 ounce rounds, with today's prices at $19.45, $10.43, and $4.58 respectively, when their one ounce was at $36.92. I personally dont like the lower denominations as the premiums are normally up there and think most people can afford an ounce for 40 bucks.

Aquataine said...

Agree with most of this SB. I buy 1 oz maple leaves myself. Anyone wanting to redeem needs to search out a bullion retailer near you and, no, banks will not redeem anything under about 100 oz bars. Piss on them they are too expensive to deal with anyway. Something for all to consider is that silver prices are more volatile than gold and silver tends to follow the stock market more too. That is until the eventual crash one day...maybe soon who can know these days. However when silver falls there is usually a delay before gold does if it does at all. The silver to gold ratio is very high right now and there is a pretty good base under both now so buying silver now will get you more gold later when the ratio returns to something more normal. Trade some of the BIG silver, near the peak, for gold and realize more profit when it is time to sell the gold and then sit back pretty on cash (or property) and a stack of small silver to get you through the storm. Thats my plan anyway... for what it's worth. Good luck!

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John Park said...

I am interested in purchasing silvers.
If I purchase from or do I have to pay any taxes in Canada?

I want to find out the best way to purchase silvers.
I live in White Rock B.C. Canada.
Thank you.

Thank you very much for your insights.

Canadian silver bug said...

There is no tax on pure bullion in Canada unless its a collectable form like maple leafs or u.s. Eagles, but even then its only certain provinces that charge taxes on those purhcases. Ontario being one of them

BC is one of the tax free provinces so you should pay nothing beyond the silver in U.S. dollars and shipping.

While I like the majestic products those scottsdale stackers are very nice ,, good luck

John Park said...

Thank you very much for your response.
Do you recommend purchasing from those online sources over scotia bank or local pawn shops or local gold and silver dealers?

Thank you very much for your insights once again :)

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ahnn said...

Great post to those who want to sell silver. At least they've got idea on when to sell.

stock said...

This blog Is very informative. You explain each and every point very well.

Anonymous said...

@John Park I personally think online is the way to go when buying silver.

The big issue with buying from a brick & mortar store is they have to pay for substantial security & personnel to maintain their physical presence so costs tend to be higher.

Banks like Scotiabank only tend to deal in large volume orders so if you are buying a really large quantity go for it.

Otherwise online is the way to go for keeping costs low :)

I've bought on eBay before and they can have good prices. I've also bought from and was pretty happy with their service.

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