Three Letters Re: Advice on Silver or Gold Jewelry for Barter?

Three Letters Re: Advice on Silver or Gold Jewelry for Barter?

From the Survival Blog

Friday, Mar 13, 2009

Hi -
I just read your comments regarding not holding jewelry for precious metals holdings. As one who makes his living (and has done so for decades) in jewelry, coins and guns, I fully agree with your comments. I have had many customers in over the years that had decided that jewelry was a good place to invest in precious metals, and after I went over it with them, they have all switched to good products.
There are some very good fake jewelry out there these days that will fool many, even with the use of a stone and acid. I learned the old fashioned way, using straight nitric acid rather that the acid mixes used today, which are much more fool-able and can tell much closer the karat and whether or not an items is solid, filled or totally phony. I also learned diamonds using just a loupe rather than with an electronic probe. And I agree with your comments about gemstones as well - they look great in the bottom of an aquarium but unless I know I can sell it to someone, I would never put my own money out for them.
You might go over (or you may have already in the archives) some of the other good silver and gold products to buy and hold, or I would be happy to write something up for you. I give this advice out daily in my shop, where I do guns and coins. Many of my customers are buying both, and food storage is increasingly a topic of discussion as well. I do a lot of digging and searching for ammo, so I am one of the very few places in town with ammo on the shelf and guns on the rack. - G. in Las Vegas

 

Dear Mr Rawles,
I just read the letter about using jewelry for barter on your web site and think your answer is right on. I am a jeweler in the Midwest and would like to add to your comments.
If someone wanted to sell jewelry now and buy items that would be easier to barter with during a post-dollar society here are some tips and insights.

1. Never send your jewelry away to a company advertising cash for gold on television. These people are crooks and you will get next to nothing for your gold.

2. The next worse place to take your jewelry for sale would be a pawn shop.

3. A jeweler or coin dealer is a better bet and will generally give you more money for what you have. Go to an independent jeweler, not a nationwide chain. Check with a couple of jewelers if you don’t have one you trust.

4. To get top dollar for your jewelry try selling it yourself. This has some drawbacks, it will take time and is a serious breach of OPSEC. Some jewelers may be willing to sell nicer pieces on consignment, this eliminates most of the OPSEC issues.

I can tell people how much they should get from a jeweler and why. Expect to get 50-65% of the actual market value of gold for your jewelry. Why so low you ask? There are a couple of reasons.
First the jeweler isn’t buying your gold, he’s buying your gold’s future. He doesn’t send the gold in to the refiner the day you sell it, he sends it in when he has several ounces to send at once. If the market falls between the time you get your money and when the gold is sent in the jeweler could loose money.
Refining gold isn’t free. First the package must be insured and shipped to the refiner. The refiner charges a fee to assay the gold, to determine its precious metal content. Then the refiner takes a cut off the top. The price varies from refiner to refiner but they generally get between 7-10%.
And finally the jeweler has to make a profit to keep his doors open.
A better bet for old, unused jewelry might be to have it melted down and made into something you will use.
Some things that will come in handy if you want to take in jewelry as payment in a post-collapse setting. Get an acid test kit and learn how to use it. These kits will give an approximate karat quality for 10-14-18k gold. Below is a list of how much gold is in each quality of gold.

10k = 41.66% gold (sometimes stamped 416)
14k = 58.5% gold (sometimes stamped 585)
18k = 75% gold (sometimes stamped 750)

It is illegal to put a quality mark on anything less than 10K gold in the USA. If you run across anything stamped 8K or 9K it probably came from Mexico and should be considered suspect. Always file the piece to be tested in an inconspicuous place, removing just a bit of metal, and put the acid on that spot. This will cut through any possible plating and give a test on the metal underneath. Get a scale, I’m sure most of you have a grain scale for measuring out powder charges, this works fine for weighing gold, just convert to ounces and remember that precious metals are weighed in Troy ounces not Avoirdupois ounces. [14 versus 16 ounces per pound.] A gram or pennyweight scale isn’t expensive and every house should have one. After weighing its just a matter of figuring out how much gold is really worth. Also get a good, strong magnet and check everything with it. There are lots of frauds out there, anything that sticks to a magnet is gold plated and should be considered junk.

A word of caution about gemstones, don’t give any money for gems unless you know exactly what you’re dealing with, and never trust an appraisal. Tell the seller that you aren’t interested in the stones and they can remove them from the setting if they want them. Don’t remove them yourself. Also don’t expect to get much for stones in jewelry you are selling unless they are exceptionally rare and valuable. Jewelers usually have many carats of diamonds on hand, they don’t need yours, and if they do buy them the stones will sit in inventory for months before being used.

Be careful dealing with jewelry after TEOTWAWKI. I know what I’m doing around jewelry and I’d much rather deal in coins or other forms of wealth. Its easier and faster and I could use the coins to trade with almost anyone. Remember, just because you are willing to trade for jewelry doesn’t mean that someone will [later] want to take it from you in trade. Take note of what my old boss used to say, “Gold is a wonderful thing, but you can’t eat it and it doesn’t keep you warm at night.
Keep your powder dry, - Kestrel

 

Hi Jim,
I have recently started a business buying and selling unused/unwanted jewelry, coins and PMs (precious metals). One thing that I have learned through the start-up process, is that in a TEOTWAWKI situation, being able to identify PM coins or jewelry's value will be a skill that could really come in handy. Having scales, acid testing kits, and electronic testing equipment such as the ones I bought from igem.com, could really give you an edge when the balloon goes up. I bought the GLR-24 tester that can determining the karat content of a piece from 6-24 karat gold, and can also detect the presence of platinum and silver. My acid kit (which only runs about $20), can identify gold as well, but the process is bit more time-consuming, however the advantage is that I will not be entirely reliant on a battery-operated electronic device when/if it breaks later on down the road. Using an acid testing kit takes practice, and you would be wise to learn how to do it now, and not try to figure it out under more stressful times that are sure to come.

I also acquired a gem tester in the kit (that detects diamonds, moissants, and zirconium gems), although the value of these items would be suspect at best, as not many would trust their authenticity, and thus, they would be hard to utilize as a form of currency (but having the ability to test them can't hurt either as an opportunity could present itself I suppose). In the kit I also received an electronic scale that weighs in ounces, grams, and grains and a lighted loop for reading the stampings.

Keep in mind that people can stamp whatever they want on metals or jewelry, but that does not make it authentic! Coins are even forged a lot (read: China) in today's world. The only way to truly determine something's worth is to have the means to test it!!! I would also recommend that all survival bloggers have a print-out of weight and measure conversion charts, and that you become familiar with the process of calculating the worth of 10K, 14K, 18K and 24K gold. It is also important to know how to calculate the value of coinage and know their purity content for their respective years they were minted. Remember, fiat currency will probably become a thing of the past, and bartering skills as well as the ability to identify what the other guys stuff is worth will be key to fair trade. - Jeff in Michigan

JWR Replies: Thanks for that info. Here is some additional data from one of my early FAQs that folks should keep on hand both in electronic form, and in hard copy. Pack those pages with your touchstone, scale, Fisch calipers,and acid test kit:

Silver dollar bags ($1,000 face value) contain approximately 765 ounces of silver
Thus, if the "spot" price is $5.20/oz., a $1,000 bag would be worth $3,978, wholesale. (Or think of it as 3.97 times the face value of any single coin.) Small quantity purchases (less than $10 face value) get the buyer the worst rate (currently roughly 5.5 times face value.) Large purchases (multiple $1,000 bags) allow the best rate--roughly only 4 or 5% over the melt value

90% .50/.25/.10 bags ($1,000 face value) contain approximately 715 ounces of silver

40% half dollar bags ($1,000 face value) contain approximately 296 ounces of silver


Conversion Formulas:
Grams to pennyweights, multiply grams by .643
Pennyweights to grams, multiply pennyweights by 1.555
Grams to troy ounces, multiply grams by 0.32
Troy ounces to grams, multiply troy ounces by 31.103
Pennyweights to troy ounces, divide pennyweights by 20
Troy ounces to pennyweights, multiply troy ounces by 20
Grains to grams, multiply grains by .0648
Grams to grains, multiply grams by 15.432
Pennyweights to grains, multiply pennyweights by 24
Avoirdupois ounces to troy ounces, multiply avoirdupois ounces by .912
Troy ounces to avoirdupois ounces, multiply troy ounces by 1.097
Avoirdupois ounces to grams, multiply avoirdupois ounces by 28.35
Grams to Avoirdupois ounces, multiply grams by .035

Gold Purity Standards (by Karat):
24 K = 99.9% fine Pure Gold. Too weak for jewelry, but ideal for industrial use
23.5K = 97.92% fine
23 K = 95.83% fine
22.5K = 93.75% fine
22 K = 92.67% fine Some coin gold, though not that of the U.S., is 22K
21.6K = 90.00% fine The approximate purity of U.S. gold coins
21.5K = 89.58% fine
21 K = 87.50% fine
20.5K = 85.42% fine
20 K = 83.33% fine
19.5K = 81.25% fine
19 K = 79.17% fine
18.5K = 77.08% fine
18 K = 75.00% fine The highest grade of gold normally used in jewelry.
17.5K = 72.92% fine
17 K = 70.83% fine
16.5K = 68.75% fine
16 K = 66.67% fine 1/3 copper. This grade is commonly used in dental work.
15.5K = 64.58% fine
15 K = 62.50% fine
14.5K = 60.42% fine
14 K = 58.33% fine
13.5K = 56.25% fine
13 K = 54.17% fine
12.5K = 52.08% fine
12 K = 50.00% fine Half gold, half copper. Used extensively in low priced jewelry. (Will show brownish tinge in reaction to Nitric Acid.)
11.5K = 47.92% fine The percentage of copper now exceeds that of gold.
11 K = 45.83% fine
10.5K = 43.75% fine
10 K = 41.67% fine Used in some low-grade jewelry such as class rings. Shows a marked reaction to Nitric Acid.
9.5 K = 39.58% fine
9 K = 37.50% fine Not much more than one-third gold.

Silver Purity Standards:
.9999 fine "Pure Silver"
.9584 fine "Britannia Silver" Often used in manufacturing.
.9250 fine "Sterling Silver" Normally stamped "Sterling" or ".925"
.9000 fine "Coin Silver" Some antique items are marked "Dollar" or " D" or ".900" or "Coin Silver" to indicate they were made from melted coins.
" German Silver" is +/- 97% base metal and only +/- 3% silver, and thus has no bullion value.

Exactly what silver or gold coins will bring you in barter will depend on the times. Immediately after a collapse, coins may not be worth much. As law and order is gradually restored, they will probably be worth more and more. The bottom line is the old legal maxim: "The value of a thing is what that thing will bring."