Jump to content
CoinPeople.com

Melt price on Morgans and Peace dollars


Recommended Posts

Morgans and Peace dollars have 412.5 grains .900 fine silver, or 371.25 grains pure silver which is equal to 0.7734 troy ounces. At current spot of $12.37 that would mean a melt value of $9.57. Of course actual melting of these coins would be done by actual weight such that heavily worn peices would be worth less, while unc. or AU coins would be closer to the $9.57 calculated above. Right now I would expect average circ dollars to be priced between $10-12.

Link to post
Share on other sites

I'm unclear w.r.t. "melt price". Is that the price a scrap metals dealer would pay me for 1oz?,,, is it the price a silver mining company sells silver for?,,, etc. I'm guessing that if I took my 1oz. of silver to a pawn shop they wouldn't give me full melt price,,, also guessing that if I took 1oz. to the scrap metals dealer or silver mining company they wouldn't give me melt value either.

 

So what gives silver it's ultimate value? Industrial users? Shiny jewlry dealers?,, both? And how much would an industrial user or shiny jewry dealer give me for my shiny 1oz of silver. Since they would have to transform it into consumable form, wouldn't the cost of this transformation be taken out of the melt value.?

Link to post
Share on other sites

A one oz. round/coin/bar is always bought for the going "bid" price for 1 oz, since it can be used right away, and is recognized.

 

Coins on the other hand are usually worn and dirty, and need to be refined before use, so are typically bought as at a 10-20% discount, depending on who's buying. Certain coins (like U.S. war nickels) with unusual alloys may be bought at futher discounts due to their need to be melted seperately.

Link to post
Share on other sites

Silver dollars are usually traded as a bullion item in their own right, so often are bought at melt, or slightly above. For example, a local dealer here buys at:

 

SAE, SML: melt+$0.50

Misc. Christmas rounds and the like: melt

US Silver pre-64: 83%

US Silver dollars (minimum F): melt

Link to post
Share on other sites

I guess I was just looking for the price at which silver coins would be valued by an entity capable of buying in the quantities required to establish an ultimate worth.

The local guys are probably turning US silver dollars to other collectors, investors, etc. at a small markup which allows them to buy something not ultimately worth it's melt value @ melt value,,, using the coin collector base as a buying market. But if this market dried up in hard times and we were swapping silver morgans for loaves of bread and a loaf of bread was costed at 9.50.... would I be a wise man to sell my loaf for a single morgan,, or ~1.21 morgans?

Link to post
Share on other sites
I guess I was just looking for the price at which silver coins would be valued by an entity capable of buying in the quantities required to establish an ultimate worth.   

The local guys are probably turning US silver dollars to other collectors, investors, etc. at a small markup which allows them to buy something not ultimately worth it's melt value @ melt value,,, using the coin collector base as a buying market.  But if this market dried up in hard times and we were swapping silver morgans for loaves of bread and a loaf of bread was costed at 9.50.... would I be a wise man to sell my loaf for a single morgan,, or ~1.21 morgans?

If we were living in a hypothetical world where a loaf of bread was $9.50 and the market price of your morgan was also $9.50, then you would be neither wise nor unwise to swap. They are products of equal value (provide the same utility/happiness to the market). It would simply depend on your personal preferences at that moment. If more people prefered one choice to the other, then the prices would change accordingly and the hypothetical world you presented no longer exists.

Link to post
Share on other sites

Yes, most coin shops are selling to a collector base that tends to pay a premium. I wonder if they could sell any culls to a silver smelting company for $8.50 per,,, even with Silver at $13 per oz. I think that might be tough.

 

Point is that folks investing in Silver coinage just in case very very hard times hit may find that if those times do in fact occur, the buyers floating $8.50 per cull will vanish and the only buyer left will be offering much less (ie - industrial value).

 

Now as a short term investment in good times... now that a different story. Nothing sells like a coin with $25 worth of melt value silver when silver is going up....heck some will even sell for more than the melt value...

 

I love Capitalism.

Link to post
Share on other sites

Here is one interesting quote when I went to a gold mine here in Australia.

 

One of the gold mines here have only 0.9 grams per tonne of rock but it takes just 10 USD to extract the gold from it. To transport it etc would add to the cost but indeed, that is a good figure of why the gold mines prosper.

 

Probably the real reason why silver is so expensive right now is because silver is not mined as often, but as a byproduct of other metals if I am not mistaken.

Link to post
Share on other sites
  ... silver is so expensive right now is because silver is not mined as often, but as a byproduct of other metals if I am not mistaken.

 

You are correct! Generally, silver comes to market as a byproduct of copper production. Copper ingots leave the mines 95% pure and purified further by others who keep the byproducts for their efforts while selling 99% pure copper to fabricators. With precious metals rising, there are some who will refine the refined 99% to 99.%, but this is not the mainstream of commerce.

 

Also, in any case, we are speaking of at least one usually more -- many more -- railroad cars of copper ingots, not a mere pound or ton.

 

If copper production lags behind silver consumption, the price of silver rises.

 

The price of silver also rises in tandem with gold as a consequence of Americans (mostly) who are bullish for metal money.

 

China and India are traditional silver markets, as are the Islamic lands. However, recently, both China and India opened up to gold ownership.

Link to post
Share on other sites

I believe that silver is going up because the public has finally found out that there is less of the physical metal available than has been sold on paper. This has been going on for years, but it's reached the tipping point. Silver is being used up faster than it is currently being produced.

Link to post
Share on other sites
  So what gives silver it's ultimate value?  Industrial users?  Shiny jewlry dealers?,, both? 

 

Silver is primarily an industrial commodity with coinage and jewelry as distant second and third consumers.

 

One example of an industrial use of silver is 2% silver solder in electronics. Photography (including x-rays) does not consume as much as it did in the past, though still a significant consumption market for silver.

 

Demand for silver is built on three main pillars; industrial and decorative uses, photography and jewelry & silverware. Together, these three categories represent more than 95 percent of annual silver consumption. In 2003, 351 million ounces of silver were used for industrial applications, while over 196 million ounces of silver were committed to the photographic sector, and 266 million ounces were consumed in the jewelry and silverware markets.

http://www.silverinstitute.org/uses.php

 

Silver batteries... silver bearings...

Link to post
Share on other sites
Silver dollars are usually traded as a bullion item ...

SAE, SML: melt+$0.50

Misc. Christmas rounds and the like: melt

US Silver pre-64: 83%

US Silver dollars (minimum F): melt

 

Yes, any dealer will pay melt for silver dollars, but no dealer will sell them that way. There is too much collector demand. The Morgan Dollar is probably the single most popular coin in America. The $20 Saint Gaudens is the best-liked, but it is a pricy item, of course. The Morgan Dollar in particular but Peace Dollars, also, are the subject of books about varieties. You don't get that with 1964 Kennedy Halfs, Roosevelt Dimes and Washington Quarters.

 

Anyone who wants to get into coin dealering can go to any coin store and buy their Morgan and Peace dollars at RETAIL and turn around and sell them to other people for more than nominal "retail." Silver dollars are very popular items.

Link to post
Share on other sites
I guess I was just looking for the price at which silver coins would be valued by an entity capable of buying in the quantities required to establish an ultimate worth.   

The local guys are probably turning US silver dollars to other collectors, investors, etc. at a small markup which allows them to buy something not ultimately worth it's melt value @ melt value,,, using the coin collector base as a buying market.  But if this market dried up in hard times and we were swapping silver morgans for loaves of bread and a loaf of bread was costed at 9.50.... would I be a wise man to sell my loaf for a single morgan,, or ~1.21 morgans?

 

I think if we got this point (i.e. like 1923 Germany), then most goods would cease being priced in paper dollars at all, since it would fluctuate hourly, instead a loaf of bread would cost a silver quarter, and then the store would post constantly fluctuating paper to silver dollar exchange rates for those few who would still pay in paper. Of course we are a long way from this reality!

 

As for what silver dollars go for, I bought a bunch of culls about 2 months ago when silver was about $9.50, and I paid about $7.25 for them. Today, culls are running $10 or so. They are treated separately though since one silver dollar contains more silver than 2 silver quarters or 10 silver dimes. That's why 90% silver dimes/quarters/halves are quoted as $Y x Face, and silver dollars are just quoted flat.

Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
×
×
  • Create New...