I will start out by saying that this post is not meant to send you off to the bank for a huge withdrawal so that you can go dump a ton of money into silver or gold bullion. However, I believe that silver is either relatively inexpensive/undervalued right now or it is a well-priced inflation hedge. I think that holds true as long as silver is below $40-50/oz. I think that it is a good time to buy some silver if you’re doing that type of thing. I wouldn’t suggest buying gold, though. It may be properly valued where it is, but it may be overvalued. If it’s a good buy where it is, then silver is an outstanding buy. If however, it is very overvalued where it stands now, then a silver buy protects you from the downside risk. Also, don’t go buy some silver expecting to make a quick buck. Investing in precious metals is a very long-term protective play. A 1964 silver dollar is worth about as much gas today (5-6 gallons – gas at $3-4.00) today as it was back in the 1964 (3-4 gallons – gas at $0.30/gal - Source: 1964 Flashback) However, a 1968 dollar coin will get you less than a gallon since it is worth, well… $1. So buying silver won’t make you rich. It preserves your purchasing power. Like I said… it’s your money and I’m not officially qualified to render any advice, so take what I’ve said as me blabbering about. But I’m certainly not the only one who believes this right now. And you would do well to educate yourself further given the bleak financial future that we may be faced with.
There are lots of ways to buy silver, including US Gov’t-issued legal tender Silver Eagles, pre-1964 coins (90% silver and called “junk” or “constitutional” silver), or various forms of bullion (e.g., minted rounds or bars). Do some homework on what you want and what you are buying before you do anything. People sell things for as much as they can get and some overreach. You might find some good deals on eBay. You can be more confident buying from somewhere like Monex but they will charge a premium. I’ll recommend one reputable dealer here – Silver & Gold Shop. Mary Beth has always been very helpful, informative, and has pretty good prices on rounds, bars, and eagles. Another dealer who has been recommended to me but with whom I have not yet engaged is JM Bullion. Their prices are a little better, but I have no experience with their service. Here’s a link to information on current “junk” silver values and below is graph of recent silver prices: