Platinum

The Isle of Man, in 1983, issued a very popular, 1 oz. Noble platinum bullion coin which enticed other mints to issue their own platinum coins.  The American Platinum Eagle was introduced in 1997 but for nearly 10 years, Australia’s Koala and the Canadian Maple Leaf coins have been among the leading platinum coins sold.

Platinum is nearly impossible to corrode with gases or chemicals and heavier than gold and was finally recognized as a new element in 1751.  It was used to make laboratory instruments in Belgium in 1784 and was used in France for glass production and it is still used today.  Platinum has also been used by jewelers and goldsmiths.  The Royal Goldsmith to Louis XVI and Pierre Chabaneu of Spain used the metal for expensive cutlery, coat buttons and watch chains but platinum was rarely used until high-temperature torches were developed and Louis Cartier became the first person to successfully set diamonds into platinum jewelry.  King Edward VII of England then hailed Cartier as the “jeweler of kings and the king of jewelers.”

The daughter of the King of Thebes was buried in 700 BC in a platinum and gold decorated sarcophagus but knowledge about and usage of platinum did not reawaken until many centuries later.  We do know that the Incas used platinum in their jewelry and the use of platinum re-appeared again, briefly, when the Europeans explored the New World.  The Spanish conquistadores called platinum ‘platina’, meaning ‘little silver’, and they threw it back into the rivers of Ecuador to ‘ripen’, thinking it was an inferior metal.

Though Columbia is still the only major producer of platinum, it ceased exporting platinum in 1820 and in 1822 Russia became the source in the gold fields of the Ural Mountains.  The Russian government produced almost 500,000 ounces of platinum over the next 18 years and started the world-wide assumption that platinum was like gold.

The world’s largest platinum deposit was found in 1924 in Johannesburg, South Africa and in 1985 small amounts of platinum bars for individual investors were introduced in Japan.  Johnson Matthey & Co. Ltd. and the Engelhard Corporation, two platinum fabricators, began to produce one and ten ounce platinum bars after the huge price changes, during the late 70’s and 80’s, when interest in platinum bullion spread to Europe and the U.S.

Silver is used in so many ways and in so many products from dental fillings to computer keyboards and circuits, photographic film, mirrors and so many other products as well.  Some of silver’s unique properties are its strength, malleability, electrical and thermal conductivity.  Silver also has sensitivity to as well as high reflectance of light and the ability to endure extreme temperature ranges.

Silver is known to kill bacteria.  It can affect and break down cell membranes, promote production of new cells and increase the healing rate in wounds and bone.  It can even regenerate new skin where skin has been lost.  Silver also has natural antibacterial qualities used in bandages and other wound-care products.

The list for silver uses is nearly endless.  Included in this never ending list are silver-coated quartz tiles used in NASA space shuttle missions.  The new silver-lithium-aluminum alloy is the strongest wrought aluminum alloy known.  Silver oxide-zinc batteries are used in watches, cameras and other small electronic devices as well as larger batteries for tools and commercial portable TV cameras.  Silver is also used in polyester fabrics, hydraulic fluids, engine antifreezes and most flexible plastics such as Mylar.

Geologists estimate that 17 ounces of silver exist for every ounce of gold which helps to explain why an ounce of gold has sold for 15-20 times more than the price of silver.  In 1900 there were about 12 billion ounces of silver in the world.  Today that figure has fallen to about 300 million ounces of above-ground, refined silver.

With all the applications of silver use in the world today and plenty of potentially new uses on the horizon, such as the new “low E squared” silver on glass which reflects nearly 95% of the hot sun’s rays, there are plenty of good reasons to add silver to your portfolio.  Silver is a highly liquid asset and as a semi-numismatic coin (meaning there is a limited supply), silver coins have appreciated 1400% since 1960.  There’s also privacy with investing in silver coins because silver coin purchases are not reportable and are also considered collectible meaning that they are more likely to remain legally tradable in the event of another confiscation.

Silver demand has been surging, while available supplies have been shrinking over the last decade.  Wealthy investors such like Bill Gates and Warren Buffet have diversified into silver.  The possibilities that silver prices could soar, are staggering!

During times of world turmoil, depressions, wars and economic crisis, people crave financial security and owning physical gold can answer that need.  Traditional investment strategies are becoming more and more obsolete and every investment portfolio should hold some physical gold.

In 1933, Roosevelt’s Executive Order declared it illegal for American citizens to own gold.  Americans were forced to hand over all their gold on or before May 1, 1933 or face 10 years in prison.  Paper dollars replaced the gold.  One type of gold, however, was recognized as having special value to collectors and was not confiscated.  Those coins were numismatic (collectable) and semi-numismatic (semi-collectable) gold coins.

Americans have been allowed to own gold since 1975 but could gold be confiscated again?  Yes, it could but collectible gold coins have been and are still excluded from confiscation.

Frighteningly, nearly every investment we make today is highly visible and reportable to the government.  With new regulations and transaction reporting laws, nearly everything from cash, cashier’s checks, money orders and even some forms of gold are reportable.  Your privacy, which was supposed to be guaranteed by the Constitution’s 4th Amendment, seems to have disappeared all together when it comes to your investments.

Coin dealers are now required by law to report the sale of your bullion coins sold to them to the IRS.  However, coins with a 15% premium do not have to be reported when sold to a coin dealer.  The semi-numismatic $20 Liberty and $20 St. Gauden gold coins have premiums well above 15% and, therefore, are non-reportable.  Currently the semi-numismatic $20 Liberty and St. Gauden gold coins have a 40-90% premium over bullion.

The premium on Semi-numismatic $20 gold coins has recently grown to 100% and could potentially rise even higher.  While bullion coins are minted each year by the millions, semi-numismatic coins are in a very limited supply and nearly 100 years old so when gold goes up semi-numismatic coins typically double.