Serious Silver Stacking – Part 1, by East Sierra Sage

How I learned to save my money and make it grow without the oversight of a Bank, Credit Union, or other Financial Institutions. And how to insulate yourself from inflation, domestic financial stagnation, and an eventual economic depression or financial and equities collapse!

I never looked at money from a long-term perspective until the end of my military career when I realized that I should have done better with saving my money for when I was older. I can say that I put three kids through college and helped them out whenever they needed it, but as for my wife and I, we didn’t “pay ourselves first”!

After I retired from the Marine Corps, I started a career where I made a handsome six-figure salary. That career choice lasted seven years and the only real thing I have to show for it is a “showpiece” home. My home is modest on the outside, but well-furnished and tastefully decorated inside. Fortunately, I have a “grey man” home from the outside.

I caught the fever for Silver at a good time, after the last economic downturn in 2008. Things did go very bad for a lot of Americans who were living paycheck to paycheck AND who were living beyond their means, I have rarely lived paycheck to paycheck and have always lived within my means, HOWEVER, I have felt the sting of inflation, especially in the year of 2021! I cannot go into the many reasons for America’s current inflationary surge, but I can illuminate for you, the reader, how I am affected and how I am insulated.

I have been buying Silver since 2008. I got a tipoff from a fellow Devil Dog when we were in Albany, New York on an assignment training Reserve Marines. We traveled on a Friday so that we could get to our destination early for our Monday morning meet-up with the Leadership of that unit we were training.

We went out for dinner and cocktails on Saturday evening, we left the hotel and traveled in our rental, I was driving and my associate, Jason, saw a coin shop and asked me to stop there briefly. I went into the small shop with him. Jason asked the clerk about silver bullion. After some friendly conversation and some product selecting, Jason paid the man for the two pieces of silver that he wanted. When we were seated at the restaurant I decided to ask him what that was all about. I was very surprised that silver could be had for such an inexpensive sum of cash. Jason informed me that he read this “Preparedness” blog (yes, SurvivalBlog) he said he learned some interesting things about investing his cash on the Blog. Jason told me that Silver was a commodity that was easily found and conveniently purchased, It was affordable and it was a great “long term” investment.

When we got back to our hotel, I planted myself in front of the hotel computer and became engrossed in the SurvivalBlog site and with the Idea of parking my money somewhere other than a bank, credit union, or other forms of structured investment. I wanted to know everything there was to know about Silver. I read about the History, the scientific usage, the versatility of this precious metal, I was surprised to find out that during the Colonial times of America, that many residents used Spanish Silver as currency in the Colonies, which seems strange on the face of it, because a majority of the residents of the colonies were of English descent, not Spanish descent. I live in the “East Sierra” portion of California and Northern Nevada, the story of Silver in Virginia City, Nevada, just by itself could inform a person of the true nature of the Value of Silver, regardless the source of the ore, or the minting of the coinage. Silver and other precious metals have real intrinsic value.

While traveling home the following Friday, I badgered Jason during the whole flight about buying my Silver online, Jason discouraged me from making my purchases online, primarily due to issues with shipping and charges. “Why wait for it and pay shipping, when you can go in, see it, touch it and make a human connection”? Hmmmmm, Jason made a good point! He directed me to several places in our area where I could go in and purchase Silver in its various forms from coin shops and pawnshops. Jason informed me that Silver can be found in Antique stores, especially the consignment kind where many of the booths or tables are owned by different vendors.

In our area there is a small family-owned chain of stores that deals in Gold and Silver Bullion, as well as Coinage and new and used jewelry. This Mom & Pop shop has a good reputation and has an outstanding customer service ethic. I tend to shop there for my Silver but I also have made purchases from several other venues, I found a particularly good deal once in a consignment Antique store. I believe that some vendors are siblings whose aged parents pass and don’t have a clue about the worth of some items, I purchased about $4.00, face value of Buffalo Nickels, they were in good shape for the $12.00 that I paid for them. When I brought the coinage to my Mom & Pop shop, I made $63.00. Not a large amount of money, but I converted my profit to Silver, which at the time was going for about $14.00 to $15.00 an ounce so essentially I got two pieces of Silver Bullion rounds, the remaining money went for lunch at a nice local bistro with my wife.

Tangibles have value

I have watched Silver more than double in price from what I paid. This served me well in December of 2018 when my Daughter got married. I was only 8 months into a new job after a 5-month unemployed period. I needed money to pay the caterer, the DJ, the facility, and the Hotel room for my Daughter and new Son-in-law. I ended up selling about 110 ounces of my precious stash, I walked out of the shop with $2,090. Not too bad considering the fact that I averaged paying between $12.90 to about $14.75 per ounce and got back $19.00 an ounce.

I didn’t purchase this Silver all at once. Instead, I did it bit by precious bit. The largest purchase I made then was 10 ounces of Silver Bullion at around $14.50 an ounce, this felt large to me at the time, it can be scary to purchase something that needs to be protected and has no use, except to appreciate in value.

When I walked out of the shop and showed my wife the Two-G’s, she was impressed, my wife has never been interested in my “preps” at all, and suddenly she started taking notice! I will address the “buy in” that my wife has developed later in this article.

My misses and I still had to take money out of savings for the wedding, but the lion’s share of the spending came from “Stacking them deep”. I think we took $700 out of the bank for the payoffs, but that sum is better than if I had to source savings for the entire sum of debts owed for services rendered.

By selling that 110 ounces, I violated my first principle for investing in Silver in the first place: Long term investment. Despite violating this principle I parted with that Silver satisfied knowing that as the Father of the Bride (FOTB), I was going to pay for things that I committed to paying for, No debt, No Credit Card revolving debt! When I paid those who still needed paying, I handed them all cash, when you hand over cash, you get smiles, and gratitude. To the future FOTBs, I will offer this piece of advice, when it is time to be the FOTB, Show up, Pay up and Shut up!!! I did and I had a wonderful experience, and gained a Son!

The World of Value

For those who are unfamiliar with the myriad issues of investing your money into physical Silver, Bullion Rounds are what I mainly invested in. Bullion comes in many different types, the kind I preferred is the Round coins that are produced by many different mints and financial interests. I prefer Silver bullion rounds because I can store them in stacks of twenty in convenient plastic containers which cost about fifty cents. If you purchase twenty Silver rounds all at once, they give you the plastic container for free. This plastic container is how the mints/manufacturers ship them to your dealer, and to you, if you shop online, (I dislike shopping online).

Silver is also available as genuine U.S. currency, I have some of this, I generally don’t like it because there are factors that drive up the cost of this and other precious metals.

1) Silver coins are actual money minted by the Government of these United States, which means that it is illegal to melt it down, cut it, fraction it, or even make jewelry out of it! (I have seen some very beautiful Jewelry made out of One Dollar pieces.)

2) You, as the purchaser, will pay more for actual currency because of the fact that it is real money. It is backed by the U.S. Government and it is a precious metal.

3) Dealers add a fee called a “premium”. Dealers don’t just sell currency for the market-driven spot price of Silver, they add on their premium. This is how they make money from a sale. Some of the larger dealers will give you a discounted bulk price. Please consider this: If Silver were selling at $25.00 per Troy ounce and the premium the vendor charges is about $4.50 a coin, your investment is $29.50 per coin. Bullion “rounds” that I have purchased have generally been about $1.50 a round for the premium. During the beginning of the Covid pandemic my Mom & Pop shop must have taken a bath on Silver, it went way down to about $11.00 an ounce. They were still asking the $1.50 premium on a Tuesday, when I went and made a “major” purchase, on Wednesday they figured it out and started asking (demanding) $7.60 for the premium. I am glad that my attention to the market and my learning, via this blog, allowed me to save so much money on that Tuesday.

4) It is important to mention that Actual U.S. currency has another factor: numismatic value. Some coins are old and in collector quality condition, or some coins are super rare or even flawed in a manner so rare that it demands a high price. Most coins are old, tarnished, worn, and sometimes just ugly! I mentioned the buffalo nickel coins earlier, they were worn and ugly, but to me they had character, this is bad for value retention from a numismatic perspective.

5) Actual U.S. currency are legally coins, Silver bullion is legally not allowed to be called “coins” or “Coinage”. The first time I went to make a purchase of Silver bullion rounds I called them coins, The clerk working my Mom & Pop shop, gave me a very informative lecture about the terms used in the Silver/Gold industry, as well as the “Numismatic” community. For Coin collectors there is a language unto itself. I took the knowledge forward by generally avoiding U.S. coinage, and sticking exclusively to silver bullion rounds.

6) The Silver bullion that I have purchased over the years is my property! U.S. Coinage can and has been recalled in the past. When Franklin Delano Roosevelt (FDR) was president, he sponsored a law that required U.S. Citizens to surrender their Gold Coins! I am not sure what the denominations of the coinage was, I believe they were $20 denominations, In 1933, $20 had the potential to obtain a lot more goods and services than it does today. All four of my Grandparents talked about this when I was a child and teenager, their generation adored FDR! My people were no exception, however, they had venom in their voices when they spoke of this law that FDR enacted. All four of my grandparents were first-generation Americans, so I suppose they had some of their European parents desire to make a better life here, in the land of Milk and Honey. I am now Fifty years old and can really appreciate the things that my people talked about when I was young, they suffered through the Great Depression and then fought in the Second World War, Both grannies worked at home in the steel industry.

My paternal Grandpa served in the Pacific theater and then again during the Korean War. He died young, but financially wealthy, because he was willing to walk away from a cookie cutter union job and applied his ability to calculate and mitigate risks into a ridiculously financially rewarding career as a restaurateur. My maternal Grandpa was a steel worker and welder, he learned and developed skills which served him until he died at 83. The man could weld anything and could mend anything made out of metallic products. These skills made him income that helped him do good and fun things because they supplemented his meager day job income, and allowed him to invest in stocks and bonds, which served his generation well through a Post-World War Two economy which boomed from 1946 until 1965. In short, they were the greatest generation because they went from being the dirt poor children of dirt poor Immigrants from Ireland, France, Germany, and Sweden, having nothing, to having the healthiest, longest-lived offspring that any human civilization has ever produced. (Baby Boomers). This is a type of investment in human flesh that may inspire me to write another article in the future.

A lot can be learned from that generation and from the crucible of time that their metal was cast from! I often worry about the future of These United States. I worry because of the concept of the idea of the “death of currency” if this happens in these United States, I know that the American dream is over. Then we will certainly have a hot civil war, which will make the War Between the States look like schoolyard fistfight. Prayer for our Nation is needed now more than ever.

7) When I was a wee lad, my Mother taught me this: “possession is nine-tenths of the law.” Would you want “Biden-Flation” or any other political movement/belief to force you to surrender your property? I already know the answer, but consider this, I believe that there has been a war waged against wealth for at least the last seven years. In fact, just his week Thomas Piketty, the renowned French economist and author released his latest book: Time for Socialism. I have read his other books, and have learned a lot of useful information. I recoil at the idea of Socialism simply because it almost always leads to full-on Communism. Both political philosophies have an inhuman tolerance for wealth, wealthy people, the pursuit of wealth, and the influence of wealthy people. Both philosophies also have a long historical record of killing wealthy people, persecuting wealthy people, and then redistributing their assets. This simply put is stealing with state sponsorship. Again, I believe that this nonsense will lead to a hot civil war. All “Civil Wars” lead to the annihilation of economies and property.

8) This Blog: SurvivalBlog has a deep library of articles and free resources for the readers to access that present ideas and strategies for an investor to turn to, if they want to gain knowledge. Knowledge is power. This Library also has many articles that discuss the concept of Inflation and how durable goods hold their value. This requires more funds [in inflated dollars] to acquire said named item(s). No one complains when a gallon of milk is $2.00 to $3.00. Everyone complains when that same product becomes $4.12 a gallon. The reader must ask themselves this: How can I stretch my money? There are so many ways that I couldn’t begin to cover them in this article. I will share with you my real-world examples of something that I am enduring as of the time of my writing this article, I think that the wisdom of silver investing will shine through!

(To be concluded tomorrow, in Part 2.)