Release: MONDAY JULY 24, 2020
In 1963, a St. Louis man had a premonition. He was a successful stockbroker named Harry Langenberg. Stockbrokers, of course, need to have a good idea of what might rise or fall in value. Some would say Harry had a sixth sense about certain things. He certainly did his homework, but he also had remarkable insight.
One thing Harry believed in was hard assets – specifically precious metals. Back then, that meant gold and silver. The thing is, in the early 1960s, one precious metal was actually circulating in pocket change. Dimes, quarters and half dollars were struck from 90 percent silver. You could tell they were silver by the distinctive “chime” they made when dropped on a counter.
In 1963, the government announced the dime, quarter and half dollar would, in 1965, change from being made of silver to a clad composition of copper and nickel as we have today. They contended that the new coins would “seamlessly mix in with the older coins” and we would see no difference. Many accepted that at face value. Not Harry. Even though the silver content value of ten dimes or four quarters was just one dollar, Harry knew something was afoot.
When the switch-over to clad coinage began in 1965, Harry initiated his plan to accumulate as many of the “old” silver coins as possible. He enlisted the help of the newsboys in downtown St. Louis. Harry offered every newsboy $1.05 for every dollar’s worth of silver dimes, quarters or half dollars they brought to his office. Every afternoon, newsboys lined up to cash in their silver coins and make an immediate five percent profit.
If you think Harry was taking advantage of the newsboys, consider their profit was five percent DAILY. Today, the best Money Market account is paying a paltry three percent per YEAR. Not a bad haul day after day. And adjusted for inflation, a nickel in 1965 would be over 40-cents today.
It took a while but the value of silver slowly began to rise. By 1968 it had climbed to over $2.00 per ounce. Had Harry cashed in, he would have doubled his money in just three years. It dropped a bit in the early ‘70s but really began to take off in the mid-70s. Then, in 1980, inflation went crazy and precious metals skyrocketed. Gold soared from $100 to $850 per ounce. (Not surprisingly Harry had also been buying gold.) For a short time, silver had even climbed to $50 per ounce.
Since the roller coaster ride of the 1970s and ‘80s, silver and gold have continued to intrigue investors. It’s also had an impact on collectors. Not only do casual collectors have to pay more for common coins struck from precious metals, many of those coins are becoming scarce due to the large number of them melted down for their metal content. It is believed that hundreds of thousands of collectible silver (and gold) coins – including loads of silver dollars from the early 1900s disappeared due to melting in the early 1980s.
In the past few months, the price of both gold and silver have quietly been rising. As of this writing, the price of gold is just shy of $1,900 per ounce and silver is $22.50. That means, for particularly nice $20 gold pieces from before 1933, many dealers are paying upwards of $2,000 per coin. Rare dates will fetch substantially more.
For those of us with dimes and quarters lying around dated 1964 and before, their value may be a pleasant surprise. Dealers often advertise to buy silver coins at a multiple of their face-value. Right now, most dealers are paying just over 12 times face. So, for every silver dime they will give you $1.20. For every quarter they will pay $3.00. And, for every silver half dollar they will pay $6.00.
Understand, as recently as nine years ago, in 2011, the value of silver had climbed to $48 per ounce. It only lasted for a few days but that would mean dealers were paying upwards of 25 times face value or $2.50 for every dime.
Sadly, my crystal ball is still on the fritz so, pandemic or not, I can’t predict where precious metals prices are headed. Is this an advantageous time to buy or to cash in what you have to take the money and run?
Alas, where’s Harry when you really need him?
For more collecting advice, visit www.peterexford.blogspot.com