With silver attempting $18 an ounce in recent days after being below $14 at the beginning of the year, it is no surprise that interest in bullion coins is rising among investors.
One of the ways of owning silver is to buy the old pre-1965 dimes, quarters and half dollars.
I checked the APMEX website for prices.
If you want $100 face value of Franklin half dollars, the cost is $1,536.54 with silver at $17.40 a troy ounce.
For 1964 Kennedy half dollars, the price is the same.
The markup, therefore, is roughly 24 percent from melt value figured at .715 ounce of silver per $1 face value.
Why do investors acquire these coins?
Sometimes they are a good deal.
Sometimes these silver coins are touted as the way to make change in the event of an economic catastrophe. It is this latter use that gave me an idea.
The Mint should strike more 90 percent silver coins to be sold in the bullion coin market.
Currently the Mint has 90 percent silver blanks made for use in the annual silver proof sets.
Why not ramp up the quantity of blanks made and make uncirculated versions as bullion coins and sell them to bullion buyers who want to make change in a catastrophe?
With a 24 percent margin between melt value and the retail price, the Mint should be able to find a pricing sweet spot where it can ship new 90 percent silver coins by the bag directly to its Authorized Purchasers.
In addition to bullion investors, average collectors might get a kick out of assembling silver dime, quarter and half dollar sets year by year.
Because hobbyists have often objected that collector coins sold by the Mint have markups that are too high, collectors of bullion coins distributed through the Authorized Purchaser network would catch quite a price break.
It works for collectors of bullion silver American Eagles, why not for collectors of new silver dimes, quarters and half dollars dated 2016, 2017, 2018 and on into the future?
It appears to me the Mint could create a popular new avenue of silver coin sales that would satisfy both investors and collectors.
Buzz blogger Dave Harper has twice won the Numismatic Literary Guild Award for Best Blog and is editor of the weekly newspaper "Numismatic News."
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