Afternoon everyone …..
I’ve seen a lot of new faces on the platform lately that have been either commenting on posts relating to silver and or gold or posting about them.
So I thought that I’d take the time to write about stacking physical silver and gold.
What is silver and gold stacking?
Stacking is the accumulating and acquiring physical silver and gold over a period of time. Growing your holdings as a long term investment or for future use.
A history of gold and silver…
Silver and gold have been real money since 700 BC, when the Lydian merchants produced the very first coin. These were not coins as we know of today, they were more like stamped lumps that were comprised of 63% gold and 27% silver.
In 1900 introduced by the United States government the gold dollar was declared the standard unit of account and a gold reserve for government issued paper notes was established. Greenbacks, silver certificates, and silver dollars continued to be legal tender, all redeemable in gold.
But in 1933 that all changed when the United States went off the gold standard, a monetary system in which currency is backed by gold, when Congress enacted a joint resolution nullifying the right of creditors to demand payment in gold.
Then President Roosevelt's Executive Order 6102 required U.S. citizens to deliver on or before May 1, 1933, all but a small amount of gold coin, gold bullion, and gold certificates owned by them to the Federal Reserve, in exchange for $20.67 per troy ounce. Under the Trading With the Enemy Act of October 6, 1917, as amended on March 9, 1933, violation of the order was punishable by fine up to $10,000 or up to ten years in prison, or both. An exception to the order was listed in section 2 (b) Gold coins and gold certificates in an amount not exceeding in the aggregate $100 belonging to any one person; and gold coins having a recognized special value to collectors of rare and unusual coins. It was illegal to own more than five gold Double Eagle coins.
Even more of a reason to own it…..
There are many different ways to stack both gold and silver. In some countries such as India. Most stack their gold and silver as jewelry, which makes it very easy to transport. Their jewelry is usually 18K or higher as well, not like most countries who use 14K for jewelry.
Some people prefer to stack constitutional silver and gold. These are coins minted by a country for every day commerce that contain varying percentages of precious metals depending on the country and year produced. Also know as “Junk Silver”.
You can also stack sovereign minted coins. These are also minted by a country. They are not intended for commerce, but solely for their precious metal content. A denomination is required to be considered a coin.
(Examples:) I’m going to use a Gold American Eagle as my example since I live in the United States. The 1/10 ounce gold eagle has a $5 denomination, the 1/4 ounce has a $10 denomination, the 1/2 ounce has a $25 denomination and the one ounce has a $50 denomination. Obviously the precious metal content is worth far more than the face value struck on the coin. These are the most recognized forms of precious metals, and are the easiest to sell when the time comes.
Next up is rounds. While these are way more prevalent in silver than gold, there are some mints that do strike gold rounds. These are struck just like coins are, with varying designs. They are not allowed to have a denomination on them since they are not minted by a country. Rounds typically will sell for less of a premium than government minted coins. The designs are typically basic in design, but some mints produce very well struck rounds some in very limited quantities.
Bars are another option for stacking. These are by far the most stacked item in both silver and gold. Ten ounce silver bars are the most popular size to stack, and also have the best premium over spot. There are over a hundred different mints currently producing silver bars across the globe, so you choices on silver bars is pretty much endless. Gold bars are also the most stacked in the world. But not by the stackers. Over 90% of all gold above the surface is in the form of bars. But these bars are huge ingots that are held in vaults by countries not by us stackers. One ounce gold bars are the cheapest way to stack gold over spot price. There are many quality mints that produce them. These are typically not the choice of stackers though. Why? You might ask. Because they are the number one most counterfeited item in all precious metals. They are harder to sell to someone who doesn’t have a precious metals analyzer to verify them for this reason. But they are the cheapest choice for the metal content in gold.
Last up on my stacking choices will be hand poured bars and art pieces. These are pieces that are either poured by hand into a mold or designed mold. But they can also be poured into a hand made clay mold into all sorts of silver art. These are not really meant as a way to stack in my opinion, but are a way to enjoy your silver pieces on display.
There are other ways to stack silver mainly but gold as well. You could buy sterling silverware or drink ware, or even recycled old computer parts for their gold content. It’s up to you
Aside from the above mentioned items to stack there are many different ways to go about accumulating it.
Some people make a monthly or quarterly budget and make scheduled purchases at those times regardless of spot price. Others wait for what we call dips in the spot price to make purchases. This is when the spot price has taken a down turn from where it was, making it cheaper to buy.
While neither is wrong. Keep this in mind. It’s all about the cost average of your total purchases over a period of time. In the end both will probably be about the same in cost average depending on how long you’ve been stacking.
If you budget $100 or $200 a month for precious metals then don’t worry about the spot price. Instead look at the lowest premium items to buy within that budget. Timing dips is not an exact science and can be a frustrating way to continually make purchases. Without having years of experience and being quite lucky catching the dips exactly at the right time can be a challenge. Even for the most experienced and savvy stacker.
My final note
Stack what you enjoy and it will never be boring. It all adds up at the end.
