Should You Buy Silver Bullion or Join Numis Network?

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You have probably been hearing about gold and silver bullion lately, well, depending on what TV channels you pay attention to. The higher end channels have been telling people to buy gold and silver and the lower end channels have been telling you to send your metals in a little envelope and they may send you a check. So, what to do and also what is Numis Network and what does it have to do with this topic? Read on for these answers and more..

What is Silver Bullion?

Silver bullion can be bars or rounds (coins) that are pure silver or 90% or higher in silver. The purity does not matter as much as the actual amount in weight of silver in the product. For example the American silver eagle is .999 pure silver but what is more important to know is that it is one ounce of silver. Silver bullion is being purchased by folks that believe in a currency crisis and think that times are going to get worse before they get better, thereby a “hedge” against the dollar.

What is Numis Network?

Numis Network is a network marketing company that instead of yummy shakes, juices or soap, has gold and silver as their product. Specifically, they deal in gold and silver graded coins. These are coins that have been certified and graded by a third party company as to their authenticity and condition. The main product of Numis Network is modern issued Mint state 70 graded government issued gold and silver coins. The collectible coin or Numismatic industry is a $100 billion industry. That means $11 million an hour is sold of these coins but prior to Numis Netork had never been attempted in a network marketing company.

Is Silver Bullion vs. Numismatic coins the real question?

Well, not really. The reasons people would buy silver bullion vs join Numis Network are different. However, you can talk about Numismatic coins vs. silver bullion. Here is one interesting article that came out the other day that talks about the volatility of bullion vs Numismatic coins.

I should note here, just for full disclosure that I personally do invest pretty heavily in silver bullion but my main source of income does come from Numis Network. The reason I say that is sometimes people think that Numis Network is suggesting that buying silver bullion is bad and that is NOT the case, it just isn’t the product of Numis network.

So, why do people Join Numis Network?

People join Numis Network are typically looking for an additional income, tax advantages or to win some lifestyle rewards like cruises, cars, etc. Buying silver bullion cannot directly offer any of those things but we will come back to that.

So, if Silver Bullion is NOT the competition of Numis, what is?

Well, juicy juices, yummy shakes, soap, technology, etc are all the standard products that have been done in network marketing the last 70 years. Companies that offer tax advantages, lifestyle rewards and a passive income are the competition, not bullion.

Why do people REALLY buy Silver Bullion?

It is an investment. Again, predicting the collapse of the dollar would be a good reason to diversify and have some precious metals. But, lets dig a little deeper. Why do people really invest, in anything? Well, it is the pursuit of increase right? The pursuit of leverage a smaller amount of money into a larger amount of money. Keep digging..why do people want larger amounts of money? For a few reasons, 1) It gives security. 2) It creates options and 3) It can, if used wisely, create more freedom in ones life. So, in a nut shell, people buy silver bullion to create a better lifestyle. Did you know that silver bullion held for over a year is NOT taxed at the standard 15% capital gain but at 28%? It is also impossible to create a passive income with silver bullion. Even if you were daytrading ETF’s or whatever, that is NOT passive income which is arguably the best way to reach that lifestyle that people really invest to achieve.

What about Gold and Silver Bullion in an MLM? Perfect World or Potential Problem?

If you like bullion and you like passive income, well, why not just have a network marketing company use bullion as the product? If you had that idea, don’t worry, so have a lot of other people. Historically there have been 9 other companies that have attempted to do bullion in a network marketing company, all with a 100% failure rate for varying reasons. It is actually not illegal to do bullion as a product in a network marketing company but the problem comes in with two very specific areas.

1) Profit margins and prices charged on commodities
2) Compensating non-licensed folks on commodities

The biggest problem is number one. There is very little profit margin in bullion. It is extremely competitive and any “price adjustment” to create profit in a product highly scrutinized and regulated, well, historically has not fared well for the past gold and silver bullion mlm’s. There is one gold mlm out there right now that has you not receive your product physically as they conveniently store it for you out of country. Not only do I not trust that but I also don’t think a government entity would either.

Are Numis Network Coins Overpriced?

Here is the phenomenon that I have noticed. You have about 2-3% of the population at least slightly educated that know it might be a good time to buy gold and silver. The rest of society is more focused on Britney’s hair color or whatever the preferred media distraction of the day is. I am a HUGE proponent that people should become more educated about the times we are in. Ron Pauls book “End the Fed” might be a good start to get up to speed. However, those that are slightly educated on gold and silver have learned about bullion and think all other forms of buying gold and silver is silly. Intelligence, they say, is the ability to make distinctions. This is an area of non-intelligence for most people.

The numismatic industry, according to the American Numismatics Association (ANA), is a $100 billion a year industry. Larger than the pet industry and an average of $11 million an hour is sold in collectible coins each hour. So, the smarter question is, does Numis Network have competitive prices in this industry? The answer is, well, do your own reseach! Haha, OK, I will give you some examples for those that don’t feel like it. These are prices I just looked up today (10-3-2011), I wanted to pick several examples.

Example 1: 2011 MS70 Silver Libertad (1 Ounce of Silver) – Apmex Price – $349 – Numis Price to members – $119
Example 2: 2010 PR70 Silver Disabled Veteran (1 ounce of silver) – Govmint Price – $149 – Numis price to members – $129
Example 3: 2001 MS70 and PR70 Buffalo Silver Dollars ((2) 1 ounce of silver coins) – Home Shopping Network Price – $1499 – Numis Price to Members – $1099

You can also check pricing on graded gold and silver at First Federal, ShopNBC, Franklinmint, as well as the three mentioned above. Numis Network is NOT the low price leader of every coin ever minted but all in all, the prices are competitive, which, is what you really want to have in a business.

What to do! – Guideline to Bullion or Numis

I will help you out so you know which to consider:

– Have tons of cash, need no tax breaks or residual income but want to hedge against the dollar? Buy bullion, oh, and congrats by the way!

– Need an income? Consider joining and building Numis Network as bullion can only give you a capital gain when you sell, cannot create an income for you.

Other Consideration

Bullion is more volatile than Numismatic coins but that does NOT mean I am anti-bullion, quite contrary actually. I buy a lot of silver bullion every month but it is from money I made from Numis Network (leverage baby!). One neat thing that Numis Network offers is a 5 year buyback guarantee on their coins shipped through autoship. That means if you are unhappy with your coins or coin values 5 years after you receive them, you can sell them back to Numis for 100% of what you paid. Now, most places that sell silver bullion will buy your coins back but at the market price. So, if the mere chance that Silver dropped significantly (like it just did), the bullion companies would NOT pay you what you paid but what the market is at the time you want to sell.

Rather hear this on audio? – Here is a recording I did for my Numis Network team where I talk about some of the things I covered in this blog. – Listen here

As always, your feedback is appreciated!

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