Your source to Buy Gold Investments

The first article in our series on how the value of silver is determined by the different grades, more to come on buying silver, selling silver and getting a Silver IRA.

Silver Grades and Quality Products

There are a lot of questions such as “Gold vs Silver, where should I invest, or is investing in silver a good idea?” It really depends on the objective but to start here are factors concerning the purity level of silver.

“Sterling Silver” indicates quality as did the British Pound Sterling currency at one time. “Sterling” is the name for a grade of silver pure enough to be valuable, yet mixed with other metal(s) for serviceable strength. Most common would be sterling tableware that is 92.5 percent silver and, usually, 7.5 percent copper. Similarly, sterling tea sets, trays, etc., are perceived as valuable and functional silver services. These items may be collectibles or expensive rare antiques, possibly suitable for investment, so do not sell them for re-melt silver without checking their value. Jewelry represents another group of silver products where quality matters and it is important to not sell such pieces for bullion prices.

One proof of quality is the mark sterling, and another is the numerals 925. Variously, there are registered “hallmarks” of silversmiths that produced sterling or other grades.

Silver Grades

The U.S. did not require grading until 1868, although some hallmarks are known to always be sterling. Some early U.S. silver was marked coin or pure coin.
Historical silver purity in the U.S. ranged from a low of about 75 percent to a high of the very soft, malleable 99.9 percent. The standard for purity is based on “millesimal fineness” which is the parts per thousand of silver content in ratio to alloy(s). For sellers of silver, the list at Metal Facts is useful–scroll down to silver. The most important millesimal marks are .999 pure silver, the .925 sterling and the .900 coin grade.

If your selling your silver read this!

These are important numbers to unskilled people selling products to dealers and buyers of re-melt silver. Conversely, unskilled buyers looking to invest in silver must know the basic numbers and be careful.

1. Do not buy antique, collectible or rare silver products for investment unless the item(s) show a stamped number of .925 or higher and/or a hallmark that can be researched.

2. When selling silver, the millesimal number indicates the percentage of pure silver in the product(s) so a buyer will pay 90 percent of the daily spot price for coin silver, minus the commission or handling fee, and 92.5 percent of spot for sterling, etc.

3. Re-sale silver may have millesimal markings in the .800s and even .700s for Scandinavian, German and Swiss products, which will result in proportional discounts from spot price

4. Some old silver, especially jewelry, may not be marked and the buyer will discount steeply. A nitric acid test can prove that such items are silver, but cannot indicate how fine. It may be wise not to sell unmarked silver.

5. Fakes exist. If a buyer declares a product bogus, do not sell. Keep it. If items prove to be silverplate by testing, keep them.

 

Only the most pure silver can be included in a Silver IRA

 

U.S. silver coin is .900 fine, with two exceptions. The War Nickels for 1942-45 were minted of .350 silver. The Kennedy half dollars of 1965-69 are .400 silver. Most of these coins are collectable. The 1964 Kennedy half is .900 fine. Other year Kennedy halves are not silver. For silver coins to be part of a Silver IRA, they need to meet several requirements including the .900 fine or greater

Millions of silver coins have numismatic values that exceed their silver content. Never sell silver coins without checking the possible collector prices. Damaged and defaced coins never meet numismatic standards. Silver coin buyers will discount for “wear.” A roll of silver dimes, for example should weigh 3.617 oz. or .07234 oz. each. Be careful when buying very old silver dimes and quarters for investment and do not pay full price for badly worn coins. Have them weighed.

The purest are the most valuable silver products

Silver rounds from private mints or mines are .999 fine and weigh one ounce. Bullion bars are .999 fine and range in weight from one to a 100 ounces. Some buyers and investors do not recognize the reputations of all silver producers, so the potential for counterfeiting requires finding specialized dealers who can perform millesimal testing. Do not buy rounds and bars from unknown producers. Same again applies here for a Silver IRA, there are very specific requirements for silver bullion and .995 is the starting point.

As a seller, knowing silver quality grades will lead to getting fair prices. When buying, knowledge of the qualities will ensure full value. Caveat emptor.

Gold is a vehicle to hold and trasport wealth into the future. Historically it is a more secure vehicle than just about any other commodity in the world.

Guest Post by Marlon Powell

Investors are confused about whether to invest in gold or not. According to most investment analysts, buying gold is a good investment option of these days. In fact, this is the safest investment idea of any tough and turbulent economic phase. Gold investment ensures maximum returns on your investment that you can use to reduce outstanding debts.

 

History of gold price

 

The history of gold price can be divided in three distinctive eras and those are

1971 – 1980 – Gold market was bullish during this period. The price of gold rose from 35 USD to 870 USD during this time.

1980 – 2001 – Gold market experienced a bear breath during this time; the price of gold came down to 283 USD from 870 USD. This has a lot to do with what is called the Gold to Silver Ratio, GSR, and the Hunt Brothers, see our articles on the History of Gold vs Silver for more info.

2001 – 2012 (ongoing) – The gold market is very bullish. Gold price has increased by more than 700% over these years. However, in August and September of 2011, it saw some drops in its price. Nevertheless, gold has always bounced back after every pullback during the last decade.

 

Reasons to buy gold

 

Here are some reasons that may support the idea of buying gold for long term safe investment.
No control over gold price– The price of gold entirely depends on the theory of supply & demand. Presently there is a huge demand for gold with a limited supply.
 
Debt burden and inflation– Since 70s, the US federal government has experienced a 3000 percent rise in its debt burden. Government prints more dollars to pay off the outstanding debts. To get out of debt crisis, it owes even more debts. Inflation is also encouraged to bring down the federal debt amount. Under such a circumstance, investing in tangible assets like gold would be a real good option.
 
Steady rise in gold price – During the last decade, the gold price has made an average gain of 19% per year. Debt issues, recession or inflation; nothing could actually stop the price hike. According to many market experts, these issues have actually persuaded the gold-price hike. The price of gold won’t stop to increase further, unless and until the issues are resolved. In reality, there is no handy solution to these issues, right now.
 
Limited supply of gold – The price of gold is controlled by its supply. Presently the demand for gold is much more than its supply and that results in gold price hike.
 

Current global economic trend suggests investors buy gold. However, you must not forget that the price of gold is subject to global trend. Therefore, should you want to reduce debts by getting good return on your investment, you must invest in both gold and secure products like bonds. Invest 65% in gold and 35% in bonds. Bonds provide low but secure return on your investment. It’s better not to play any risky game with your hard-earned money; invest wisely and live peacefully.

 

Don’t forget your tax shelter

 

Furthermore, there are multiple types of gold. We’ve only really mentioned gold bullion in the numbers above. Gold coins tend to out perform bullion. For security purposes one should focus on investing in gold however for profit purposes look to buy gold coins. Specific gold coins, pre 1933 gold coins, have additional privacy benefits since they are exempt from 1099 reporting forms. Other gold coins can be placed into a Gold IRA, which carries all the benefits of a traditional IRA just using gold as the means of wealth transference as opposed to stocks and bonds. There are very specific rules for what can be placed in a Gold IRA, so check with one of the gold investment companies for details.

Guest post from Marlon who writes for Debt Consolidation Care. You can follow DebtCC on Twitter here http://twitter.com/#!/debtcc.

Some easy to follow logic on why people move their money into different currencies and how this affect the value of the dollar.

Guest Blog Post by Ricky Peterson

Gold is a big deal right now, and regular money hasn’t had such good press as it once did. Investors have been flocking to to precious metals recently; they buy gold at every chance they get.  Why? This much you probably already know, but do you know why and what it means for the global economy and more importantly for the average consumer; ie, you and me?

The Problem With Money

This is something that we are all seeing at the moment – money is becoming less valuable; it’s called inflation and results in dollar devaluation and it happens constantly. In the past inflation meant that more money was being made and if there is more money in the system each unit is worth less. Makes sense right?
Unfortunately money is just an idea, and in this digital age, most of the money in existence doesn’t even exist. It is just numbers on computers, there is no actual paper currency tied to it – and even the paper currency isn’t tied to anything real (it used to be tied to gold, but it isn’t any more).

 

So What’s My Point?

Ok, enough doom and gloom – what does this actually mean? Well basically the currency of the world, being imaginary as it is, is in many people’s opinion not stable. Quite simply, if the government chose to create more money, which is as simple as telling a computer to credit an account, everyone else’s money would be worth less.
 

The Race To The Bottom

The reason that this is an issue now is that the global economy is not doing well and countries are desperate to be more competitive. Governments actually want to lower their exchange rates and make their currency less valuable.
Why? Well if a dollar is worth less, that makes anything sold in dollars cheaper for anyone who spends any other currency. Simply put, a poor exchange rate means more exports, which is good for the economy.
But if every country is doing it (which they are), every currency gets weaker, the foreign exchange rates end up not really changing in any substantial way – ie. No one wins. But at the same time inflation is raised and your pounds and dollars are worth less than they were last year.
 

How Do They Do It?

The simplest way for a government to effect the exchange rate is to change the interest rate, which I’m sure you will have seen going on all over the world.

The reason is simple:  If you have a lot of money to invest, you will invest it somewhere where you get a high yield – ie. Where the interest rates are high. In order to do that you would have to buy that country’s currency.
When the interest rate drops, foreign investors pull out – they sell their currency and move their funds to another country. So suddenly there are lots of investors selling that currency, which floods the local market and the value of the currency drops.
 

The Net Result Then?

Basically the overall result of all of the above is this: Inflation is high, which means your savings are losing value
Interest is low, which hurts your ability to protect the value of your savings

 

Why Buy Gold?

If you remember, all of this stems from the fact that money is not tied to anything of any value. It is imaginary and hence can change rapidly.
 
Gold has always been considered valuable and always will be because it is a limited resource. You can’t make gold (well, not without spending millions on a physics lab), so it’s intrinsic value is always assured.
 
As money becomes more and more unstable and interest rates stay low, gold becomes a more and more appealing way to store your wealth, and the increased demand, coupled with the unchanging supply means prices go up. Another huge factor for gold investment is that the US government allows for what is called a Gold IRA; basically you can put your money in gold and it becomes a tax shelter.  However there are specific requirements for what types of precious metals qualify so seek qualified gold investment companies, such as Gold Trust Financial, who specialize in IRAs.  Cool huh?

 

Author: Ricky Peterson is from www.currencyconverter.co.uk, check them out for information about every currency you can think of.

Will we see QE3: It all depends on dollar devaluation, here are some facts for and against a QE3

Over the last few months there has been a lot of speculation about whether QE3, or quantitative easing, will be used to stimulate the economy for the third round. Quantitative easing is implemented when a central bank purchases financial assets from banks or other private sector businesses with electronically created money.
 
This is done in order to inject a certain pre-determined amount of money into the economy to ensure that inflation does not drop too far; however, it can be risky if the amount needed is overestimated and too much new money is created.  The major concern with Quantitative Easing is the dollar devaluation; should too much money be created, the price of the US dollar would decline, making things like, food, gasoline and other essentials cost a great deal more.
 
Many believe ANY creation of new money does this, which isn’t necessarily false, but it is unproven.  Those looking for stability in an unstable economy turn to the worlds oldest currency and buy gold and other precious metals.  Just as the price of oil goes up due to dollar devaluation, so does the price of gold, so owning any type of physical commodity will help, gold just happens to one the easiest tools to transfer wealth into the future.
 
Here we’ll take a look at the reasons why QE3 may or may not come to be.

 

Why QE3 may happen

 
A recent survey by Citigroup Inc. showed that fewer investors are ruling out the possibility of a third round of quantitative easing due to the slowdown in job growth. The survey found that while 60% of respondents to the same survey in March expected no QE3, that number dropped to just 45% this month.
 
With the high inflation levels that the greater part of 2011 saw, QE3 was practically out of the question. However, now that inflation seems to be slowing down, QE3 may not be met with such opposition, and the Federal Reserve has already hinted that a quantitative easing may be needed to boost the economy.
 
The Dollar Index has also seen some changes lately, and where it was down to 73-74 levels during 2011, it is now at a healthier level of 79-80. This is could also encourage QE3, as a drop from its current level would not necessarily be bad for the economy.
 
Another reason why QE3 may happen has to do with politics. With the Presidential elections fast approaching, the incumbent administration will want to boost the markets to show that the economy’s health is improving, as this will increase the chances of being re-elected.

 

Why QE3 may not come about.

 
Despite the voices calling for a QE3, there are also those who doubt that it will be the solution and are unconvinced that it will be happening any time soon. The slow job growth that was observed in March has many people on the edge of their seats, expecting that this will be the deciding factor that will bring on a third round of quantitative easing.
 
However, just as the months of strong job growth did not convince economist Ben Bernanke that QE3 should be ruled out; it is also unlikely that one month of slower growth will immediately cause the Federal Reserve to implement QE3.
 
This theory can be backed up by the fact that Fed policy makers prefer to look at cumulative trends by using up to six months of data. When one takes a closer look at these trends, it can be noted that although only 120,000 new jobs were added during March, the number of payroll gains during the first few months of 2012 is around 212,000. With this mind, one month of slower growth in the area of job gains is unlikely to be considered severe enough to warrant QE3. Those who don’t believe QE3 is likely to happen any time soon feel that in order for QE3 to come about, there would need to be either a major bank fail or a full-scale crash.
 
Marry Harris, chief economist at New York’s UBS Securities, feels that the economy is showing enough signs of strength to prevent QE3. As it is, the situation does not seem to call for another round of quantitative easing just yet, although the final outcome remains undecided.
 

Author Bio:
Patrick Del Rosario is part of the team behind Open Colleges. It is one of Australia’s pioneer and leading providers of online TAFE courses and business management courses. When not working, Patrick enjoys blogging about career and business. Patrick is also a photography enthusiast and is currently running a photography studio in the Philippines.