March 24, 2009 – Silver Coins And Bars

When gold and silver spot prices increase to historically high levels, interest in fractional silver coins and bars is piqued. While gold and silver investing are both hot commodities on the market, silver is unique for being readily affordable by any consumer, certainly in North America.

Classically, silver coins were issued in tiny denominations, such as the roughly 0.8g obol, found in ancient Greece. Even the biblically-referenced shekel was issued in 1/8 fraction denominations weighing just over 0.7g – meaning they are tiny enough to be easily lost.

When the US Mint established its coinage, a dollar was worth exactly one ounce of silver. This meant that any coin made of silver and smaller than one ounce would have to be a fraction of a dollar. When first approved in 1792, silver coins from $1 to a “half-dime” five-cent piece were created. For this reason, 90% silver US quarter-dollar manufactured before 1964 are valuable as bullion as well as collector’s items.

During the Civil War, fractional silver was only minted and circulated on the West Coast. This continued until 1873 when nickel interests interceded and had both 3-cent and 5-cent coins minted in a copper/nickel. Canada continued to make thin, 5-cent silver coins until 1922. Dimes and quarters both were converted to base metals in 1964, also, though half-dollars continued to be made of silver for one more commemorative year after the assassination of President Kennedy (just as he was about to sign a new silver certificate into law).

Other countries have issued fractional silver as investment-grade bullion at some point before just as most do with gold. And silver, bullion being so relatively inexpensive as compared to gold, is often used in commemorative coins, colored or minted with other metals or even gemstones. Some even finds its way into jewelery.

Today, much of the fractional silver that is available are in 1g and 5g silver bars, commemorative pieces, medals or rounds, though a few coins do still exist. A great many different types of fractional silver rounds and bars were created during the 1970s, when interference in the silver market caused the price to rise well above $20-ounce. Even bars from this period are considered collectible down to the tiniest. A 1g bar is only a few millimeters across on each size – small enough to loose in a shag carpet.

Larger sizes of silver bullion bar or round, such as the 10g and ½-ounce bars, have also been produced, as well as a very collectible few from that period at 20g. Many of these have been issued by silver mining companies and stamped with a weight and purity. More decorative rounds made for collection value are tied to having been made from historical silver, such as that found in abandoned mines or shipwrecks. One type was even made with cut-marks down the middle to allow the owner to split the 1-ounce and ½-ounce bars are subsequently marked as ½- and ¼-ounce sections.

Unlike coins of gold and silver, bars of silver are not typically dated, marked with a country or origin or have a “face” value. Some have serial numbers. For those who want to invest in gold and silver but don’t have the resources to focus on gold exclusively, the potentially very handy nature of small silver coin during a very extreme crisis is reason enough for many to look for both contemporary and historical fractional silver to take advantage of high gold and silver spot prices even when cash is tight.

Mary Foller

March 24, 2009

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