Should I- and which "Junk" morgans should I buy? Lets discuss this!

I currently have about 200 ounces of silver, 60% of my silver is .999 gvmt minted 1 ounce rounds and 40% of my silver is AU-BU 90% junk silver. I also have 20 common date but VF-XF Morgans. Now I can get these common date morgans in VF-XF-maybe AU condition for around $3 dollars over melt... I had 2 questions.

Do you think it's a good idea, at the prices I indicated, to add about 10 more morgans to my hoard?
This is from a BULLION standpoint with the consideration that there is a SMALL But SIGNIFICANT Numismatic connection to these common date morgans. They sell for significantly high prices on ebay. Or would you rather put your money into .999 silver instead?

My second question is which dates should I look for.... I know that these are all common dates but I know that sometimes 1921 Morgans sell at slight discount to all other dates... (They're all the same price where I buy). Is there any other high mintage dates to stay away from? 1886 maybe? I'll be "cherry picking" morgans out of a melt bag.

Thanks alot for any and all help. Feel free to explore and discuss this topic of buying "Junk" Morgans. I plan on buying when my local coin shop opens this friday.

 

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If you're buying for bullion, why would you buy Morgans?

Think of it this way:

$3 premium per coin in common condition. Non-key Morgans are actually kind of tough to sell in off-conditions. Why? Because there are so many in low MS (60-62) grades out there for about the book price of VF/AU common Morgans. As a bullion speculation play, a $3 per coin premium works out to ~10.5% above spot AT A MINIMUM. Since you're dealing in lower grade coins, circulation wear might add another 1-3% of metal loss. (This is far more severe on dimes than Morgans, but it's still an issue.) For this same reason, 1921s are actually a better value than earlier strikes, since they're less likely to have excessive circulation wear. Again, this is based purely upon the question you presented of best value in terms of bullion.

The reason 1921s are "discounted" relative to other common Morgans is they made over 86mm of them. Additionally, they were the first issue post-Pittman Act, which means a good quantity of them "survived" over the years.

Now, if you're buying for numismatic purposes, that's a different story entirely.

 

if you are a coin collector as well as an accumulator of bullion, then buying older coins does have some appeal. In my accumulation of bullion over the past 30 years, i have bought the spectrum of coins: from massive numbers of ASE's --to additional premium coins such as rolls of uncirculated peace and morgan dollars, bags of circulated franklin, walker, and barber halfs, circulated merc dimes. I bought these latter coins because I found them "interesting" and they are a bit more fun to look at that all those freshly minted ASE's. One thing I have noticed though, if you think silver is going much higher, and you are buying silver as an "investment" to make money as silver prices rise, stick with the ASE's over all other forms of bullion. They rise in concert with the price of silver -- while coins you pay a higher premium for tend to have their margin premium squeezed as silver prices rise so they dont rise in value as much. However if you are a collector of coins, you might get more enjoyment out of these older U.S. coins -- but I dont think they are as good of an investment vehicle as the ASE, based purely on a rise in bullion prices. Just my opinion! By the way, there is a real shortage of ASE's right now -- so it wouldnt surprise me to see the margin premium continue to rise on ASE's over the years. Also you could attempt to buy some ASE's from the lower mintage years from the mid 1990's -- right now they are not that much more than the common later years and they could develop much larger premiums in the decades ahead.

a final benefit of ASE's as they will be the easiest to resell.

 

Numismatic values have not risen at the same rate as silver. Right now you can put together BU sets of Franklin Halves, Silver Washington Quarters and Silver Roosies at a relative small premium over what you would pay for junk silver. There are many Morgan and Peace Dollars that before the silver spike that carried a premium equal to 2 to 3 times melt that you can now purchase for a small 10% to 20% or so premium over what you would pay for junk silver. Actually if you look hard enough and do some research you can find coins that once required a premium are now selling at junk prices. I am of the opinion that once silver prices settle - many of these coins will then gradually gain their premiums back.

 

I'd go with the Morgans. But that's because I'm more of a collector than a bullion horder. I enjoy the history behind the Morgan dollar and I like looking at them more than I do a bullion coin.
I also have a local dealer who sells them to me at around $1 over spot if I buy in bulk, so that helps. At that small a spread, I'm actually getting a better deal on the common date Morgans than I can get buying silver rounds (usually $2 over spot). The same dealer will sell me ASEs at $4-5 over spot, so it makes sense for me to stick with the Morgans.

 

that sounds like a fantatic deal racebannon, i would pull the trigger on that deal all day!

 

If you can find any S mint morgans for the price you mentioned, I would go with them.

 

Apparently, you can buy cull Morgans for well under spot at APMEX right now, so I'd try that: http://www.apmex.com/Category/161/Bulk_Silver_Dollars_1878_1935.aspx
Guy

 

According to that link, culls are $31 in large quantities; melt is around $27. Were you looking at the Buy price, perchance?

 

I wouldn't buy a cull. The discount on resale will be enormous. An average circulated coin will still have some value to a collector.

 

Oops! I believe you're right, Jeff. Too many numbers on their site. But, still cheaper than Ebay.

I wouldn't either, as a collector, but the OP wants simple silver for investing, so he doesn't want to pay much if anything over spot. Culls are good for that, though you have to be careful and make sure you're not paying for silver that isn't there because 1/10 the coin was completely worn away.
Guy

 

I bought some VG and better Morgans and Peace dollars last week for about $30. To me that is a good deal. Keep in mind when dealers have customers walk in the door with AU/BU dollars, they will pay little if any premium for them unless they will grade MS63 or better. NGC is getting swamped with such BUs and with their bulk deals, the dealers are making out with sizable profits.

Stay away from cleaned and problem dollars unless you can buy near melt.

 

I think a common error is to purchase whatever is cheapest rather than purchase what can be easily resold. As much as most of us don't want to admit it, the market we eventually sell into is likely to be much more hostile than the one that exists now.

 

From a strictly bullion standpoint, I would stay away from Morgan's and any other coin that has a numismatic value. The reason is you pay a premium (a small one...but still a premium) for those coins. If you want to have a small assortment of silver for bullion, then buy the cheapest silver you can get. Find silver rounds for spot prices and don't pay a premium for a coin like a Morgan.

 

All things considered, ASEs are the easiest bullion to resell for full value, and should probably be the first choice.

 

I like the idea of Morgan's if you have an urge to buy bullion, but want downside protection. I think its smart if you want to buy silver right now.

I would look for nice, problem free Fines of better dates, (have always been a fan of coins like the 92s). I think common morgans will always be common, so I would try to look for better dates in problem free lower grades than commons in better shape.

Don't forget Peace dollars, as these are really pretty scarce after 1925.

 

Thanks for all the help guys. Back when silver was $20-25, my dealer was selling Morgans for exactly melt value. As silver's price started rising, he began adding a premium and also began seperating the morgans into 3 different bags by condition- with an appropriate premium attached to each one.

 

This ^

 

I have a few common, shiny Morgans, but mostly for the collector in me, and I like having something older than any living person. For resale value I would go with bullion since, as has been stated, the higher melt value goes the more numismatic coins that will end up going for melt as their value gets infringed upon. ASE's are good for in the states, but personally I like the rounds/bars from private companies like Pan American, NW Territorial Mint, Johnson Matthey, Engelhard, etc, because you don't pay the premiums you do on ASE's. As an investment ASE's 'should' maintain a higher premium, but when it comes down to it if you have to melt it you're going to want something that didn't have a premium. I have my share of US coins, and various rounds that fetch a higher premium, but again for collectibility more so than investment.

 

I have two standing offers that have been tried and tested. One is that I can buy ASE's @ $2.00 over spot. The other is that I can sell ASE's @ $2.00 over spot. Even if one of these standing offers fail, I'm still looking good.