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The American Silver Eagle coin is the official silver bullion coin of the United States. These were planned as an investment alternative to silver bullion coins produced outside of the country. They have since become a widely popular and internationally recognized bullion coin.
Development, Introduction and History
American Silver Eagles were introduced and are authorized by the United States Congress. Initially made available in 1986, Silver Eagles are a product of the Liberty Coin Act of 1985.
The release of a silver coinage series was largely the byproduct of unsuccessful attempts by the United States government to sell off silver reserves from the Defense National Stockpile during the 1970s. In June 1981, the Reagan administration proposed that a sale of silver could help balance the federal budget. The United States Congress passed legislation to that effect in July 1981. However, it took several years for coinage to become the official vehicle of silver sales.
By 2002, the silver stockpile was nearly depleted and, without new legislation, the American Silver Eagle program would be discontinued. In response to this, the Bush administration signed bill S. 2594 into law on July 23, 2002. This bill authorized the Secretary of the Treasury to purchase more silver on the open market in order to continue production of Silver Eagle coins.
Each American Eagle coin also comes in “proof” versions, which are specially minted for collector value. These coins are more polished than bullion versions in an effort to increase visual appeal. Proof coins are otherwise identical to bullion coins in size, shape, quality and appearance.
The US Mint introduced gold and silver version of American Eagles – American Eagle Uncirculated Coins – from 2006-2008 and again from 2011-present. Uncirculated coins undergo a different minting process than their Bullion Coin counterparts, though remain similar in appearance. The term “uncirculated” refers to coins that are created only for collecting or investing, but not for transactional use.
Special issues of American Silver Eagles have been released periodically since their introduction. For example, in 1993, special Silver Eagles were minted to commemorate the 200th anniversary of the first official United States coins from the Philadelphia mint in 1793.
In 2007-08, uncirculated Silver Eagles were packaged with the Presidential Dollar coins in the “Annual Uncirculated Dollar Coin Set.” It was towards the end of this period that global recession lead to a rush of investors looking towards bullion coins as a hedge against inflation and economic turmoil. In March 2008, sales of American Silver Eagles increased from 200,000 to more than 1.8 million, forcing a suspension to authorized dealers. By April, the US Mint was allocating Silver Eagle bullion to dealers on a weekly basis, rather than allowing unlimited open purchases.
American Silver Eagle Physical Characteristics
The content, weight and purity of all Silver Eagles are guaranteed by the United States Mint.
The front side of American Silver Eagles (“obverse” in coinage terms) features the “Walking Liberty” design by Adolph A. Weinman. This is the same image that appeared on the Walking Liberty Half Dollars which were minted by the United States from 1916-1947. The word LIBERTY stretches across the top of the obverse side; the year of mintage is printed on the bottom and the words IN GOD WE TRUST appears towards the lower right.
The back side (“reverse”) shows John Mercanti’s American Eagle. This iconic symbol of America, very similar to the Great Seal of the United States, is a proud eagle behind a shield, holding an olive branch with its right talons and arrows in its left talons. In its beak, the eagle holds a banner with the words E PLURIBUS UNUM. Thirteen stars (representing the 13 original colonies) appear in an inverse pyramid above the eagle’s head, and the words UNITED STATES OF AMERICA stretch above the stars. The bottom edge of the reverse side includes the weight (1 OZ.), content (FINE SILVER) and face value (ONE DOLLAR).
American Silver Eagle Bullion is only struck in one weight denomination: one-troy ounce. The specifications for Silver Eagles includes:
- Mass of 31.1 grams (1 troy ounce)
- Diameter of 40.6 mm
- Thickness of 2.98 mm
- 99.99% silver content
American Silver Eagle Pricing
Each American Silver Eagle carries a face value, or its transactional value when used as currency. This value is dictated by law. All American Silver Eagle Bullion coins carry a face value of US $1.00.
While technically legal tender, these values are largely symbolic; the actual value of Silver Eagles is typically much greater than the listed face value.
This is because the face value is completely separate from a coin’s intrinsic value, or value determined in the market. For American Silver Eagles, this value is primarily determined by the spot price of silver.
Since the price of silver fluctuates daily, the market prices for American Silver Eagles will fluctuate daily as well. You can check out our home page for live metal pricing.
Investing in American Silver Eagle Coins Through an IRA
American Eagles have been authorized additions to self-directed Individual Retirement Accounts (IRAs) since their inception.
By placing real, physical silver inside of an IRA, investors add a level of diversification to their portfolio that is independent of fluctuations for stocks and bonds. Since the spot price of silver tends to be much lower than gold, silver can be a more affordable, alternative hedge.
The Internal Revenue Service (IRS) allows specific types of IRAs to carry gold, silver, platinum and palladium bullion in a portfolio. Sometimes referred to as a “precious metals IRA”, these IRAs may only contain IRS-approved bullion – such as the American Eagle coins. Investors must make a minimum initial purchase of $5,000 of approved metals in order to establish a precious metals IRA. Each subsequent purchase must be at least $1,000.
Any IRS-approved bullion must meet minimum purity requirements in order to be included in an IRA. All American Eagles are guaranteed by the United States Mint to meet these requirements. Additionally, when an investor makes a purchase of American Eagle Silver coins (or any other investment-grade bullion), the IRS mandates that the metal be held in an approved depository. This precious metals depository is responsible for the safety and maintenance of the bullion it houses.
Those with existing IRAs have the option of transferring or rolling over funds into a precious metals IRA.
American Gold, Silver and Platinum Eagles coins are not available for direct purchase from the United States Mint. Rather, American Eagles are sold in bulk to qualifying institutions at a slight premium. The US Mint does, however, allow direct purchase of uncirculated and ‘proof’ coins at a fixed price.
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