HOUSTON (Euro vs Dollar Monitor) -- Silver American Eagles bullion coins are minted by the United States Mint and distributed through a number of front line wholesale bullion dealers to the public. They are sold at a small premium over the daily spot silver price. However, that premium is larger on a percentage basis relative to the value of the coin because silver is (still) much more affordable than gold.
Silver is far more rare than gold!
Substantially all of the gold ever mined still exists above ground. Most of the silver, on the other hand, is gone due to industrial uses like computer technology, photography, x-ray film, super conductivity, etc.
During the past two years, public demand for silver eagles has risen significantly. While in 2000, the Silver Institute reported a net "Implied Net Disinvestment" of silver holdings by the public in the amount of 97.7 million ounces (Moz), the years since then have seen none. (Curiously, the institute reports no actual public silver buying - whether 'implied' or actual - since then).
Both the government's strategic silver reserve and general silver reserve are now completely gone. The last batch of government silver was transferred to the U.S. Mint in 2001. When the U.S. Mint runs out of that stock, it will have to enter the silver market to acquire its raw material for future silver eagles. To gain more background information of the current silver supply deficit, please read Silver to Go 'Nuclear?'
In case of a currency breakdown and hyper-inflation, gold and Silver Eagles coins can form an 'emergency cash fund' for everyday needs. Especially Silver American Eagles, since currently valued at around 70:1 relative to gold (it takes about 70 ounces of silver to buy an ounce of gold), can be used for smaller-denomination purchases for everyday needs.
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Silver American Eagles carry a modern variation of the world-famous walking Lady Liberty motif employed on the obverse (front) of the American Gold Eagle coins. They are available only in one-ounce denominations.
Traditionally, investors with significant available funds choose gold for their higher-value investments because of its higher price to volume ratio. However, with the current silver situation, this may change once physical supplies are exhausted and the remaining holders of silver stock become unwilling to sell at current prices.
There is no reliable way of telling how high the price of silver must eventually go to clear the market. Owning and holding Silver American Eagles in your possession is a great way of hedging against future economic reversals and can provide you profits beyond your wildest dreams.
If you like the idea of using silver as an alternative currency, right where you live, right now, you need to take a careful look at The Liberty Dollar. Go to the web site to get all the necessary information.
Liberty dollars are essentially negotiable (freely exchangeable) fiat-currency substitutes based on voluntary cooperation and agreement among individuals. They are a physical cash currency, not an online currency. Many individuals and businesses in every state accept Liberty Dollars. You can find out who and where right here on this page.
Copyright (c) The Euro vs Dollar Gold Monitor 2006
Alex Wallenwein is the Editor and Publisher of the online financial newsletter, the "Euro vs Dollar Monitor," dedicated to helping investors world-wide prepare for, survive and prosper during the ongoing dollar-collapse. Please e-mail inquiries here.
