Silver, being one of the precious metals on earth due to its unique attributes, has been a convenient store of wealth for millennia. Up until 1965, most American coins were composed of 90 percent silver. In Spanish, the word “plata,” or silver, means money. Silver has been used even more than gold as a means of exchange throughout history simply because it was more common and affordable than gold.
Though silver has been generally regarded as a commodity rather than as a form of money since it stopped being used in coinage, the recent precious metals bull market that peaked in 2011 and the proliferation of information on its history as money on the internet have fostered a rebirth of interest in the metal as potentially a new form of money should there be a monetary reset given the failures of the current system.
Sterling Silver Historically Was Seen as Money
Sterling silver, given its high purity of 92.5 percent silver combined usually with 7.5 percent copper for durability — even higher in purity than pre-1965 American coinage — has been regarded as a store of wealth by moneyed families in Great Britain and Colonial America that could be melted into money during times of economic turmoil. It served a dual purpose of beautifying a home and diversifying its assets.
Similarly, silver has been regarded as a store of wealth in India, particularly among the poor who could not afford gold. When there is great price divergence between gold and silver and silver is seen to be undervalued, interest in purchasing silver — whether as an alloy or in pure bullion form — increases in the subcontinent. In China, the government has encouraged the public to purchase gold, and, given the growth of its middle class, silver has increasingly been seen as an alternative form of wealth preservation.
Because silver has not been used as money or seen as a store of wealth by most of the world in modern times, its price has been depressed, creating a nice entry point for those who are interested in this ancient form of wealth preservation or who are interesting in sterling silver collectibles. The misidentification of sterling silver pieces as base metal pieces due to widespread ignorance of common sterling hallmarks also has created opportunities for collectors to obtain valuable pieces for very cheap prices.
The Advantage of Sterling Silver Over Bullion
The advantage to collecting sterling silver over bullion is that much of the sterling silver produced has a rich history with pieces unique to particular eras and places, and with distinct art forms and varied uses. Sterling silver tableware that was used over a century ago can still be used to this day, retaining its dazzling eye-appeal with proper polishing and care. It can be used to decorate one’s home, whether in the form of candle holders, picture frames or jewelry boxes, among other things.
Lastly, collecting sterling silver provides wealth in the gratification it brings to a collector, given that it allows a collector to partake in preserving and possessing a unique part of history. Given the widespread melting and destruction of sterling silver pieces over time, every collector can potentially become a guardian of the past.