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Asante
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Save Your Nickels -- an exploration of investing in present day US Nickels.
#14332394 - 04/22/11 09:16 AM (12 years, 9 months ago) |
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Straight from the horses mouth. "nothing added, nothing taken away"

Quote:
Note: Permission to reprint, repost or forward the following article in full is granted, but only if it is not edited or excerpted.
Mass Inflation Ahead -- Save Your Nickels! By James Wesley, Rawles -- Editor of www.SurvivalBlog.com
Updated, February, 2011
I've often mused about how fun it would be to have a time machine and travel back to the early 1960s, and go on a pre-inflation shopping spree. In that era, most used cars were less than $800, and a new-in-the box Colt .45 Automatic sold for $60. In particular, it would be great to go back and get a huge pile of rolls of then-circulating US silver dimes, quarters, and half dollars at face value. (With silver presently around $30 per ounce, the US 90% silver (1964 and earlier) coinage is selling wholesale at 22 times face value--that is $22,000 for a $1,000 face value bag.)
The disappearance of 90% silver coins from circulation in the US in the mid-1960s beautifully illustrated Gresham's Law: "Bad Money Drives Out Good." People quickly realized that the debased copper sandwich coins were bogus, so anyone with half a brain saved every pre-'65 (90% silver) coin that they could find. (This resulted in a coin shortage from 1965 to 1967, while the mint frantically played catch up, producing millions of cupronickel "clad" coins. This production was so hurried that they even skipped putting mint marks on coins from 1965 to 1967.)
Alas, there are no time machines. But what if I were to tell you that there is a similar, albeit smaller-scale opportunity? Consider the lowly US five cent piece--the "nickel."
Unlike US dimes and quarters, which stopped being made of 90% silver after 1964, the composition of a nickel has essentially been unchanged since the end of World War II. It is still a 5 gram coin that is an alloy of 75% copper and 25% nickel. (An aside: Some 1942 to 1945 five cent coins were made with 35% silver, because nickel was badly-needed for wartime industrial use. Those "War Nickels" have long since been culled from circulation, by collectors.)
According to www.Coinflation.com, the 1946-2008 Nickel (with a 5 cent face value) had a base metal value of $0.0733 in February, 2011. That was 146.7% of its face value. I predict that as inflation resumes--most likely beginning in late 2011--the base metal value of nickels will rise substantially.
The Root of the Problem
It is inevitable that any country that issues a continually-inflated fiat paper currency will run into the problem of their coinage eventually having its base metal value exceed its face value. When this happens, it is one of those embarrassing "emperor's new clothes" moments. Unless a government takes the drastic step of lopping off a zero or two from their currency, this coinage problem is inevitable. In essence, we were robbed by our own government when silver coins were replaced with copper sandwich coins in the 1960s. I predict that essentially the same thing will soon to happen with nickels.
Helicopter Ben Bernanke will inflate his way out of the current liquidity crisis. through artificial lowering of interest rates, massive injections of liquidity, and monetization of the Federal debt. That can only spell one thing: inflation, and plenty of it. Mass inflation will mean much higher commodities prices (at least from the perspective of the US currency.)
In February, 2010 it was announced that the Obama administration had endorsed a change in the metal composition of pennies and nickels. And then, in November 2010, President Obama signed "The Coin Modernization, Oversight, and Continuity Act of 2010". It is very likely that the U.S. mint will begin producing debased nickels in late 2011 or early 2012. Once this change is implemented, you will then have to manually sort the "old" from the "new" debased nickels! But for now, there is still an open window of opportunity, during which time SurvivalBlog readers can salt away countless rolls and bags of nickels.
Within just a few years, the base metal value of a nickel is likely to exceed two times ("2X") its face value. (10 cents each.) The nickel will then begin to disappear from circulation. (Gresham's Law is unavoidable.) Unlike the mid-1960s experience, the missing nickels will not cause a crisis, since pennies will suffice for making small change, and most vending machines now use dimes as their smallest purchase increment. Meanwhile, most bridge tolls and toll roads have inflated so that tolls are in 10 or 25 cent increments. The demise of the nickel will hardly cause a ripple in the news.
Unless the Treasury decides to drop the issuance of nickels entirely, the US Mint will within the next three years be forced to introduce a "new" nickel with a debased composition. It will possibly be stainless steel, zinc (flashed with silver) or possibly even aluminum.
Why Not Pennies?
You may ask, why not accumulate 95% copper (pre-1982 mint date) pennies? They already seen a spike in their base metal value to 2.2 cents each. But unfortunately, pennies have two problems: confusion and bulk. They are confusing, because 95% copper pennies are now circulating side-by-side with 97.5% zinc pennies. They are also about four times as bulky (per dollar of face value) as nickels.
With nickels you won't have to spend time sorting out pre-1982 varieties. At present, visually date sorting pennies simply isn't worth your time. Although I suppose that if someone were to invent an automated density-measuring penny sorting machine, he could make a fortune. As background: The pre-1982 pennies recently had a base metal value of about $0.0295 each.) Starting in 1983, the mint switched to 97.5% zinc pennies that are just flashed with copper. Those presently have a base metal value of only about $0.0067 each.
Pennies are absurdly bulky and heavy to store. Nickels are also quite bulky, but are at least more manageable than pennies for a small investor's storage. (Storing pennies would take a tremendous amount of space and constitute a huge weight per dollar invested.)
The biggest advantage of nickels over pennies is that there is no date/composition confusion. At least for now, a nickel is a nickel. Even the newly-minted "large portrait" nickels have the same 75/25 cupronickel composition. But that is likely to change within just a couple of years. The US Mint cannot go on minting nickels at a loss much longer. My advice: start filling military surplus ammo cans with $2 (40 coin) rolls of nickels.
The standard U.S. military surplus .30 caliber size can is the perfect size for rolls of nickels. They will hold $188 of rolled nickels per can. Any larger containers would be difficult to move easily. (Avoid back strain!) Cardboard boxes are fragile, and lack a carry handle. But ammo cans are very sturdy, have an integral handle, and they are relatively cheap and plentiful. They are available at military surplus stores and gun shows. The current difference between a nickel's base metal value and its face value is fairly small, but trust me, it will grow! Someday, when nickels are worth 4X to 8X their face value, your children will thank you for it. Consider it an investment in your children's future.
In December of 2006, the US congress passed a law making it illegal to bulk export or melt down pennies and nickels. But once the old composition pennies and nickels have been driven out of circulation, that is likely to change. In fact, a bill now before congress would remove pre-1982 pennies from the melting ban. In any case, once the base metal value exceeds face value by about 3X, an investor's market will develop, regardless of whether or not melting is re-legalized. Count on it.
What if Uncle Sam Decides to Drop a Zero?
As previously noted in SurvivalBlog, inflation of the US dollar has been chronic, cumulative, and insidious. So much so that turns of phrase from old movies like "penny candy" and "its your nickel" (to describe the cost of a call on a pay phone) now seem quaint and outdated. When inflation goes on long enough, the number of digits required to express a price grows too large. (As has been seen with the Italian lira, the Zimbabwean dollar, and countless other currencies. One whitewash solution to chronic inflation that several other nations have chosen is dropping one, two, or even three zeros from their currency, in an overnight revaluation, with a mandatory paper currency exchange. The history of the past century has shown that when doing so, most governments re-issue only new paper currency, but leave the old coinage in circulation, at the same face value. This is because the sheer logistics of a coinage swap would be daunting. Typically, this leaves the holders of coinage as the unexpected beneficiaries of a 10X, 100X.or even 1,000X gain of the purchasing power of their coins. Governments just assume that most citizens just have a couple of pocketfuls of coins at any given time. So if a currency swap were to happen while you are sitting on a big pile of nickels, then you would make a handsome profit. To "cash in", you could merely spend your saved nickels in the new currency regime.
How To Build Your Pile of Nickels
How can you amass a big pile-o-nickels? Obviously just saving the few that you normally receive as pocket change is insufficient. Here are some possibilities:
1.) If you live in a state with nickel slot machine gambling (such as Nevada or New Jersey), or near an Indian tribal casino with nickel slots, go to a casino frequently and buy $50 in nickels at a time. Do your best to look like a gambler when doing so, by carrying a plastic change bucket with a few nickels in the bottom.
2.) Obtain nickels in rolls from your friendly local bank teller. Most "retail" banks are already accustomed to handing over rolls of coins to private depositors because of collector demand for statehood commemorative quarters and the new presidential dollar coins. Ask for $20 or $30 of nickels in rolls each time that you visit to do your normal banking deposits or withdrawals. It is best to ask for new "wrapped" (fresh Federal Reserve Bank issue) rolls. This way, you might have the chance of getting rolls with valuable minting errors--such as "double die" strikes. These are usually noticed and publicized a few months after the fact, and can be quite valuable. You will also be assured that you are getting full 40 coin rolls. (Getting shorted with 38 or 39 coin rolls is possible with hand-rolled coins.) If the tellers ask why you want so many, you can honestly tell them: "I'm working on a collection for my children." (You need not tell them how large a collection it is!)
3.) If you live in or near an urban area and you operate a business, you can effectively "buy" rolled coinage from your commercial bank. (They generally will not do any business with anyone unless they have an account.) It might be worth your while to on paper start a side business with "Vending Service" in its name, and have business cards and stationary printed up in that name. Have that "DBA" business entity name added to your commercial bank account. At a high-volume commercial bank you could conceivably buy hundreds or even thousands of dollars worth of nickels on the pretense of stocking change for a vending business. Depending on your relationship with the bank, they may waive any fees if you ask for a few rolls of coins. Be advised, however, that if you ask for any significant quantity at one time, they will probably charge you a premium. (Down in the small print of your account contract, there is probably wording something like this: "Coin Issued - Per Roll: .03 Currency Issued - Per $ 100: .08" Before you cry "foul", be aware that the Federal Reserve actually charges your bank a small premium when they obtain wrapped rolls of coins. (Most folks have held to the convenient fiction that a paper dollar was the same as a dollar in change. Obviously, it isn't.) In effect, your commercial banker will just be passing along this cost to you. Unless they charge you a heavy fee, don't worry about it. Ten years from now, when a $2 roll of nickel is worth $16, you'll be laughing about how you obtained $4,000 face value in nickels at just a small fraction over their face value.
4.) If you know someone that has a machine vending business, offer to buy all of their excess nickels once every month or two, by offering a small premium.
5.) If you operate a "mom and pop" retail business with a walk-in clientele, put up a small sign next to your cash register that reads: "WANTED: Rolls of nickels for my collection. I pay $2.25 per 40 coin ($2) roll, regardless of year!" Once the nickel shortage develops (as it inevitably will), you should raise you premium gradually, to keep a steady stream of coin rolls coming in.
An Aside: Nickel Logistics
Nickels are heavy! Storing and transporting them can be a challenge.
Some SurvivalBlog readers and I have done some tests:
$300 face value (150 rolls @$2 face value per roll) fits easily fit in a standard U.S. Postal Service Medium Flat Rate Box (This is the USPS "FRB1", with dimensions 11" x 8-1/2" x 5-1/2"). Full of Nickels, it weighs about 68 pounds. They can be mailed from coast to coast for less than $25. Doing so will take a bit of reinforcement. Given enough wraps of strapping tape, a corrugated box will securely transport $300 worth of Nickels. At ULINE you can get a corrugated to fit inside the corrugated Medium Flat Rate Box, to reinforce it. It is item #S-4517. It measures 10"x8"x5". These boxes presently cost 54 cents each in lots of 25.
The standard US .30 caliber ammo can works perfectly for storing rolls of Nickels at home. Each can will hold $188 of nickels in rolls. You can stack the nickel rolls vertically (on end, standing up) four to a row across the width of the ammo can. (Think of like stacking one shotgun shell on top of another.) Each of the two layers takes 11 rows of 4, plus one odd row of 3. That makes 47 rolls per layer equaling 94 rolls total. This makes for $188 of coins per can. The larger .50 caliber cans also work, but when full of coins they are too heavy to carry easily.
I've already had some ridicule, with e-mails accusing me of "hoarding." So be it. Let me preemptively state that I realize that money tied up in coins will not benefit from the interest that a bank deposit would earn. But foregoing interest is not a major concern. Why? Because I think that it is a fairly safe bet that commodity price inflation will outstrip the prevailing interest rates for at least the next five years. In five years, the circulating nickel as we now know it, will be history, and it will be treated with nearly the same reverence that we now give to pre-'65 silver coinage.
We saw what happened when clad copper dimes, quarters and half dollars were introduced in 1965. We should learn from history. Something comparable will very likely soon to happen with nickels. You, as a SurvivalBlog.com reader, are now armed with that knowledge. You can and should benefit from it, before Uncle Sugar performs his next sleight of hand trick and starts passing off silver-plated zinc tokens as "nickels". - James Wesley, Rawles -- Editor of www.SurvivalBlog.com
Permission to forward, repost, or reprint this article is granted, but only in its entirely with attribution and links intact.
Copyright 2009-2011. All Rights Reserved by James Wesley, Rawles - www.SurvivalBlog.comβ’ Permission to reprint, repost or forward this article in full is granted, but only if it is not edited or excerpted.
About the Author: James Wesley, Rawles is a former U.S. Army Intelligence officer and a noted author and lecturer on survival and preparedness topics. He is the author of "Patriots: A Novel of Survival in the Coming Collapse" and is the editor of SurvivalBlog.com--the popular daily web journal for prepared individuals living in uncertain times.
Source
Thanks Yrat for finding this 
Gentlemen, discuss.
NOT INTENDED AS INVESTMENT ADVICE, DO YOUR OWN RESEARCH - 100% AT YOUR OWN RISK
-------------------- Omnicyclion.org higher knowledge starts here
Edited by Asante (04/22/11 09:27 AM)
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teknix
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Registered: 09/16/08
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Re: Save Your Nickels -- an exploration of investing in present day US Nickels. [Re: Asante]
#14332491 - 04/22/11 09:41 AM (12 years, 9 months ago) |
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It just seems like a hassle to deal with all those nickels!
I think my silver is heavy enough as it is lol.
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Asante
Mage


Registered: 02/06/02
Posts: 86,799
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Re: Save Your Nickels -- an exploration of investing in present day US Nickels. [Re: teknix]
#14332891 - 04/22/11 11:22 AM (12 years, 9 months ago) |
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I think..
Silver > Nickels
But it does seem like an opportunity so why not? Unlike silver you are buying at face and its already worth more than that.
-------------------- Omnicyclion.org higher knowledge starts here
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bryguy27007
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Re: Save Your Nickels -- an exploration of investing in present day US Nickels. [Re: Asante]
#14333262 - 04/22/11 01:03 PM (12 years, 9 months ago) |
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I just responded in the other thread but I'll go here too. This seems like a pretty good opportunity. I need to look into getting nickels.
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Yrat
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Re: Save Your Nickels -- an exploration of investing in present day US Nickels. [Re: Asante]
#14334708 - 04/22/11 06:45 PM (12 years, 9 months ago) |
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agreed. nickels are nice because you can currently purchase them at 40% under spot (at their face value of $0.05). i can get $100 boxes of nickels prepackaged from my local bank. i go in and order them and they show up on tuesday. a $100 box of nickels weighs about 50lbs, and is worth about $140 in metal. $140 for $100 ain't bad, and it's prob only going to go up from here hell, it's never going to be less than $100 since it will always be a guaranteed $0.05 in legal tender, there is literally no downside risk. the only downside is dealing in 50lb boxes of nickels.
-------------------- "There are a thousand hacking at the branches of evil to one who is striking at the root." -Henry David Thoreau Strike The Root
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ZippoZ
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Re: Save Your Nickels -- an exploration of investing in present day US Nickels. [Re: Yrat] 1
#14335053 - 04/22/11 08:02 PM (12 years, 9 months ago) |
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but its illegal to melt these down! perhaps in a currency devaluation situation it would be a definatel plus.... people would find you out though, you cant buy milk bread and eggs every day with nickels without the locals getting jealous/pissed at you.
also $300 worth of nickels =68 lbs (1 flat rate box) so 2000lbs would be about 29 boxes, worth $8700 I mention this weight, because that is about the maximum you are going to be able to transport in your pickup truck, weight wise.... logistically, you are going to have to transport these to a smelter at some point, which may be a logistical nightmare... hoarding them in close proximity to said smelter would be a necissity.
-------------------- PEACE
zippoz "in times of widespread chaos and confusion, it has been the duty of more advanced human beings - artists, scientists, clowns, and philosophers - to create order. In such times as ours however, when there is too much order, too much m management, too much programming and control, it becomes the duty of superior men and women and women to fling their favorite monkey wrenches into the machinery. To relieve the repression of the human spirit, they must sow doubt and disruption" "People do it every day, they talk to themselves ... they see themselves as they'd like to be, they don't have the courage you have, to just run with it."
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Yrat
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Re: Save Your Nickels -- an exploration of investing in present day US Nickels. [Re: ZippoZ]
#14337645 - 04/23/11 10:07 AM (12 years, 9 months ago) |
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it is definitely illegal to melt them down, but if you hold on to them for 10-20 years maybe they'll be worth 30x their face value, like silver, and you can sell or trade them for their value. it's just another way to preserve your capital/purchasing power outside the dollar where it can't be stolen from you.
-------------------- "There are a thousand hacking at the branches of evil to one who is striking at the root." -Henry David Thoreau Strike The Root
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Groovy Grant

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Re: Save Your Nickels -- an exploration of investing in present day US Nickels. [Re: Yrat]
#14337684 - 04/23/11 10:21 AM (12 years, 9 months ago) |
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Interesting. I didn't know about the penny change, but I heard recently even the new mix they're using is costing more than what the penny is worth.
Anyways,this may be one of the first times I agree with some of you. I figure it can't hurt to put nickels aside. I'm not going to make runs on the bank or anything, but if I get a nickel I'll drop it in a jar and save it.
Thanks for sharing guys!
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ZippoZ
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Registered: 06/17/03
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Re: Save Your Nickels -- an exploration of investing in present day US Nickels. [Re: Groovy Grant]
#14338667 - 04/23/11 02:09 PM (12 years, 9 months ago) |
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id just as soon spend the $8000 that it would cost to buy a ton if nickels on prospecting, and mining claims for actual nickel deposits in the ground....
-------------------- PEACE
zippoz "in times of widespread chaos and confusion, it has been the duty of more advanced human beings - artists, scientists, clowns, and philosophers - to create order. In such times as ours however, when there is too much order, too much m management, too much programming and control, it becomes the duty of superior men and women and women to fling their favorite monkey wrenches into the machinery. To relieve the repression of the human spirit, they must sow doubt and disruption" "People do it every day, they talk to themselves ... they see themselves as they'd like to be, they don't have the courage you have, to just run with it."
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Yrat
Hello

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Re: Save Your Nickels -- an exploration of investing in present day US Nickels. [Re: ZippoZ]
#14338951 - 04/23/11 03:09 PM (12 years, 9 months ago) |
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you would rather spend the $8k on having to dig out and mine your own ore instead of purchasing already mined, refined, and minted metal at an immediate 140% gain?
whatever floats your boat.
it would take a lot more than $8k to make any sort of profit off a claim.
-------------------- "There are a thousand hacking at the branches of evil to one who is striking at the root." -Henry David Thoreau Strike The Root
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ZippoZ
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Re: Save Your Nickels -- an exploration of investing in present day US Nickels. [Re: Yrat]
#14339516 - 04/23/11 05:06 PM (12 years, 9 months ago) |
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Realistically with a small miners exemption, you could claim and hold 10 claims for the rest of your life, for abotut $3000.... the other $5k could very easily be used to locate a potential source... and you can have your theoretical 140% gain, and i say theoretical because you actually cant cash in on that...
and ill go off and stake some mining claims, in an industry where 1000% gains are not uncommon.
-------------------- PEACE
zippoz "in times of widespread chaos and confusion, it has been the duty of more advanced human beings - artists, scientists, clowns, and philosophers - to create order. In such times as ours however, when there is too much order, too much m management, too much programming and control, it becomes the duty of superior men and women and women to fling their favorite monkey wrenches into the machinery. To relieve the repression of the human spirit, they must sow doubt and disruption" "People do it every day, they talk to themselves ... they see themselves as they'd like to be, they don't have the courage you have, to just run with it."
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Yrat
Hello

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Re: Save Your Nickels -- an exploration of investing in present day US Nickels. [Re: ZippoZ]
#14342703 - 04/24/11 09:20 AM (12 years, 9 months ago) |
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or also where going bust is not uncommon.
i can't cash in on my 40% gain (40% is correct, should not have used 140% earlier, each nickel is 140% of face value) now, but if you know anything about the history of silver coinage in the US, then you know what will happen to nickels over time as well. it would be foolish not to hold at least a bit of money in this form if you plan to have it sitting around for quite some time.
-------------------- "There are a thousand hacking at the branches of evil to one who is striking at the root." -Henry David Thoreau Strike The Root
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ZippoZ
Knomadic


Registered: 06/17/03
Posts: 13,227
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Re: Save Your Nickels -- an exploration of investing in present day US Nickels. [Re: Yrat]
#14343177 - 04/24/11 11:45 AM (12 years, 9 months ago) |
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but you guys are sitting here, saying that nickel will do the same thing as silver.....
but you have to realize, its a totally different thing! also, commodoty prices are extreemely high at this point, the largest bulk commodity in the world (iron ore) keeps smashing through new levels.... but even with that, no one expects those levels to be maintained indefinitely.... new production is coming online, and more and more exploration is being funded.... the market usually just balances itself out.
short of a Zimbabwe situation, im hard pressed to see a massive return... however, i suppose there is some value in hedging against such a situation.
-------------------- PEACE
zippoz "in times of widespread chaos and confusion, it has been the duty of more advanced human beings - artists, scientists, clowns, and philosophers - to create order. In such times as ours however, when there is too much order, too much m management, too much programming and control, it becomes the duty of superior men and women and women to fling their favorite monkey wrenches into the machinery. To relieve the repression of the human spirit, they must sow doubt and disruption" "People do it every day, they talk to themselves ... they see themselves as they'd like to be, they don't have the courage you have, to just run with it."
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Yrat
Hello

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Re: Save Your Nickels -- an exploration of investing in present day US Nickels. [Re: ZippoZ]
#14344977 - 04/24/11 07:13 PM (12 years, 9 months ago) |
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if you think it's a totally different thing... you don't understand the premise at all.
-------------------- "There are a thousand hacking at the branches of evil to one who is striking at the root." -Henry David Thoreau Strike The Root
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ZippoZ
Knomadic


Registered: 06/17/03
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Re: Save Your Nickels -- an exploration of investing in present day US Nickels. [Re: Yrat]
#14345162 - 04/24/11 07:53 PM (12 years, 9 months ago) |
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i have a pretty good grasp of the intrinsic nature and value of gold and silver, their limited availability in the world, and their place in the international commodity markets.
http://www.mapsofworld.com/minerals/world-nickel-producers.html 140,000,000 tons of nickel reserves (known reserves)
30,562.5 tons World Gold Reserves http://en.wikipedia.org/wiki/Gold_reserve
570,000 tons world silver reserves http://seekingalpha.com/article/14922-is-the-old-gold-silver-ratio-of-16-still-alive-today
gold and silver reserves 600,562.5 tons/140,000,000tons =.004% Gold and silver reserves as a percentage of Nickel reserves is less than half a percent.
bottom line, there is just too much nickel in the world for it to ever become the next 'gold' or 'silver'
-------------------- PEACE
zippoz "in times of widespread chaos and confusion, it has been the duty of more advanced human beings - artists, scientists, clowns, and philosophers - to create order. In such times as ours however, when there is too much order, too much m management, too much programming and control, it becomes the duty of superior men and women and women to fling their favorite monkey wrenches into the machinery. To relieve the repression of the human spirit, they must sow doubt and disruption" "People do it every day, they talk to themselves ... they see themselves as they'd like to be, they don't have the courage you have, to just run with it."
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Yrat
Hello

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Re: Save Your Nickels -- an exploration of investing in present day US Nickels. [Re: ZippoZ]
#14347439 - 04/25/11 03:46 AM (12 years, 9 months ago) |
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nickels are 75% copper. this is one of your misunderstandings. we are talking about the coins and not the metal itself.
but even disregarding this, the point is not that the metals will become "the next" gold or silver as you say. the current opportunity exists because the metal that the coin is made of is currently worth more than the coin itself. you can "buy" the coin for less than it is worth! it is not about reserves or being the "next" silver/gold. it is about dollar devaluation and the potential preservation of capital in the form of nickels (which ironically are only 25% nickel). it doesn't seem that you understand this.
the point remains that you would have been a fool to not buy and hold silver coinage at face value when it was discontinued not too long ago. the reason was that the base metal in the coin exceeded the face value of the coin due to dollar depreciation. we are currently at the same. exact. point. with nickels (NOT a "totally different thing," literally IDENTICAL), which will probably soon be made out of stainless steel slugs. you would again be a fool not to at least collect the nickels you come across in your daily interactions.
i hope you understand this now. if not, more nickels for me
-------------------- "There are a thousand hacking at the branches of evil to one who is striking at the root." -Henry David Thoreau Strike The Root
Edited by Yrat (04/25/11 04:18 AM)
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ZippoZ
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Re: Save Your Nickels -- an exploration of investing in present day US Nickels. [Re: Yrat]
#14347963 - 04/25/11 08:25 AM (12 years, 9 months ago) |
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reserve base of copper 940,000,000 tons (about 5x that of nickel)
still too much of it in the world to ever compare it to rare elements such as gold and silver. Perhaps one day you might actually be able to (legally) sell these nickels for more than they are worth.... but not for a long long time.... and the individual value of the metals within them will never shine a light to the value of gold or silver, not by a long shot.
If you were to prorate the hours you spent hoarding nickels, over their estimated rise in value over 10 years... and amortize the costs of running around to collect, and then deliver them to a smelter.... you would be looking at making cents on the hour. A friends father works in the silver and gold melting business (buying scrap silver gold) and even he has to ship his metals over 2000 miles for melting. consider the costs of that......
another interesting thing to consider, is that all of the above listed resource numbers, will inevitably grow (albeit proportionally). What you probably have not taken the time to realize is that those numbers are calculated on the basis of what we currently know of in existence, and what can be 'proven' and 'indicated' Modern exploration for minerals and metals has barely scratched the surface of the earth.... literally most exploration these days barely goes over half a mile into the ground. What lies beneath and otherwise undiscovered at this point is bound to be exponentially larger than everything we have come to locate up to this point.
-------------------- PEACE
zippoz "in times of widespread chaos and confusion, it has been the duty of more advanced human beings - artists, scientists, clowns, and philosophers - to create order. In such times as ours however, when there is too much order, too much m management, too much programming and control, it becomes the duty of superior men and women and women to fling their favorite monkey wrenches into the machinery. To relieve the repression of the human spirit, they must sow doubt and disruption" "People do it every day, they talk to themselves ... they see themselves as they'd like to be, they don't have the courage you have, to just run with it."
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Cherk
Fashionable



Registered: 10/25/02
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Re: Save Your Nickels -- an exploration of investing in present day US Nickels. [Re: ZippoZ]
#14348075 - 04/25/11 08:59 AM (12 years, 9 months ago) |
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Quote:
Yrat said: nickels are 75% copper. this is one of your misunderstandings. we are talking about the coins and not the metal itself.
but even disregarding this, the point is not that the metals will become "the next" gold or silver as you say. the current opportunity exists because the metal that the coin is made of is currently worth more than the coin itself. you can "buy" the coin for less than it is worth! it is not about reserves or being the "next" silver/gold. it is about dollar devaluation and the potential preservation of capital in the form of nickels (which ironically are only 25% nickel). it doesn't seem that you understand this.
the point remains that you would have been a fool to not buy and hold silver coinage at face value when it was discontinued not too long ago. the reason was that the base metal in the coin exceeded the face value of the coin due to dollar depreciation. we are currently at the same. exact. point. with nickels (NOT a "totally different thing," literally IDENTICAL), which will probably soon be made out of stainless steel slugs. you would again be a fool not to at least collect the nickels you come across in your daily interactions.
i hope you understand this now. if not, more nickels for me 
In the big picture you aren't understanding what zippoz is saying about the relation between value and currency/price.
The only people who will accept more value for metal currency are collectors...you can't take a pre 1945 nickel to the convenience store, tell them it is silver and buy more than a 5 cent stick of a gum....
value is as arbitrary as currency/price...don't you think the government has this shit on lock down...
http://www.usatoday.com/money/2006-12-14-melting-ban-usat_x.htm
anyways why would you bother collecting nickles when you can take your truck around the city and find at least $100 of scrap metal in dumpsters and alleys every single day?
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I have considered such matters. SIKE
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Yrat
Hello

Registered: 11/08/07
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Re: Save Your Nickels -- an exploration of investing in present day US Nickels. [Re: Cherk]
#14348956 - 04/25/11 12:58 PM (12 years, 9 months ago) |
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like i said, whatever floats your boat.
personally, if i could take a time machine back to be able to collect silver coinage AT FACE VALUE, i certainly would.
you currently have the same opportunity with nickels, which may be worth 10, 20, 30x their face value in several years.
anyone who has read the article should realize this is not designed around short term gains. this is a "buy and hold" idea. just as if you were to have exchanged $1000 in paper for quarters while they were still made of silver. if you had done so, you would have $34,420 worth of metal today. if you had kept paper, it would still only be $1000. see the difference now folks?
in fact, this is not about gains at all, but rather hedging against inflation via metals, just as you would with gold or silver.
we will see what happens to the value of the metals composing nickels over the next several years.
-------------------- "There are a thousand hacking at the branches of evil to one who is striking at the root." -Henry David Thoreau Strike The Root
Edited by Yrat (04/25/11 01:09 PM)
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cole2684
Gamer



Registered: 02/17/10
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Re: Save Your Nickels -- an exploration of investing in present day US Nickels. [Re: Yrat]
#14373515 - 04/29/11 04:23 PM (12 years, 8 months ago) |
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This seems like a good long term idea but how sure can we really be that base metals and/or commodities will continue to rise? Like...are commodities even rising or is the dollar just plummeting?
I want to jump on this idea head over foot, but there is this hesitation...
Edit-- How many nickels would you need to have in order to truly benefit long term? Thousands, tens of thousands?
-------------------- --------------------------------------------- I'm a man who really enjoys his taffy. ---------------------------------------------
Edited by cole2684 (04/29/11 06:10 PM)
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cole2684
Gamer



Registered: 02/17/10
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Re: Save Your Nickels -- an exploration of investing in present day US Nickels. [Re: cole2684]
#14377046 - 04/30/11 11:10 AM (12 years, 8 months ago) |
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If you did indulge in this idea, and purchased a lot of rolls of circulated nickels from your bank, would you look through each nickel to see if was a buffalo/war time nickel or would you just keep em rolled up and not care?
-------------------- --------------------------------------------- I'm a man who really enjoys his taffy. ---------------------------------------------
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