Having been a student of the markets for most of my life, I find the current rally in precious metals to be interesting to say the least. Whether it is due to the fear of inflation or impatience with the pace of economic recovery, precious metals have been outperforming most asset classes for several years now.
I have my own opinions about whether or not this price level is sustainable, but the fact of the matter is that precious metals are edging closer to 30-year highs.
Silver, "the poor man's gold," has always been a more volatile metal that tends to go in the same direction. While gold has made a substantial move higher in this rally, silver has far outperformed it. There are many reasons for this. For the most part, if gold does well, silver will do even better, because silver is an industrial metal that is actually consumed in the production of various items, most notably in electronic goods. Gold is almost always recovered and recycled.
As a vending operator, you may be handling silver every day and not even realize it -- or you may not. This is because dimes and quarters minted before 1965 have 90% silver content; they are known in the industry as "junk silver." A pre-1965 quarter or dime is worth its face value in a store (or a vending machine), but its silver content is worth a great deal more -- 15 to 20 times more, at this writing.
So if you have $100 worth of "junk silver coins," at the current price of silver, you may be sitting on silver worth $1,500 to $2,000. I am not saying that these coins are easy to find, but it is worthwhile to look for the ones that continue to circulate, given the continuing rise in the price of silver.
If you wanted to make a hobby out of it, you could do a bit of research on the Web. I did.
I found an inexpensive device that separates the regular coins from the junk silver ones. It is manufactured by a small company called Coinalyzer -- coinalyzer.com -- and is a $140 apparatus that looks like a coin mechanism sitting on top of a wooden box. You pour coins into the mechanism, and they are separated into two bins, one for the silver pieces and the other, for the nonsilver ones. It's kind of neat.
So, while I am sure that most of you have better things to do, you might be able to encourage your kids to try it -- especially if they are unemployed. If it works out, you may make some money at it, or at the very least, get some peace and quiet this holiday season, while your family is busy trolling for silver in your daily collections.
I hope everyone has a prosperous New Year. It looks like we are finally pulling out of the recession, and that is something to look forward to.
DAVID LEVINE is a former financial advisor and vending company owner. He now runs MB Media Brokers (Phoenix), which specializes in low-cost wireless retrofittable signage for vending machines. Founded in 2005, MB Media Brokers was born out of Levine's conclusion that the vending industry's potential is impaired by the current perception of vending. He believes that this problem can be addressed while providing additional revenue to operators. His solution is to use digital signage to convert the existing machine base into a massive network of digital billboards, capable of both broadcasting and advertising.