Gold and Silver Terms - And What They Mean
Gold and Silver Terms: Alloy - In the case of gold and silver, an alloy is a mixture of different types of metals. The purest gold and silver are soft. In coins and jewelry other metals are added for strength, longer wear, and sometimes for color. Amalgam - Used in dental work amalgams are mixtures of metals used for fillings and bridges. If you have precious metals removed from your mouth, save them for resale to a gold buyer. Coin Debasement - The process of diluting the precious metals in coins with cheaper metals. The English did this in the 1500’s. In America silver coins were 90% silver up until after 1964, when the coins were debased. Collectable Coins - Collectable, and Numismatic coins are usually rare, or artistic coins. These coins may, or may not have been in circulation. Their value lies in their rarity, and condition. Many of these coins are made of precious metals, but their value may exceed the precious metal content.Commodity - Raw materials that are bought and sold. Gold, silver, copper, steel, wheat, corn and many other raw materials are commodities. Federal Reserve - The private company that prints the U.S. reserve notes. These notes are loaned to our government at interest. Many patriots today call for abolishing the Federal Reserve to end the cost of these loans. “I believe that banking institutions are more dangerous to our liberties than standing armies. Already they have raised up a monied aristocracy that has set the government at defiance. The issuing power (of money) should be taken away from the banks and restored to the people to whom it properly belongs.” -- Thomas Jefferson, 3rd president of the USA and Founding Father 
Gold and Silver Terms Fiat Currency - Paper money, and non precious coins are not backed by gold, or silver reserves. Due to the excess printing of fiat currencies, all fiat currencies eventually fail. U.S. Federal Reserve notes, the Euro, and all paper currency today, are fiat currencies. Devaluation of fiat currency is called inflation. Inflation causes currency to buy less, while gold and silver increase in value. Since fiat currency is not backed by real money it’s value is set by the government saying what it’s value is. Fiat money is not convertible into gold or silver. It’s value remains only as long as it’s people have faith in it. Fiat currency is not money; it is a certificate of indebtedness. Learn more about Fiat Currency here. “You have to choose [as a voter] between trusting to the natural stability of gold and the natural stability of the honesty and intelligence of the members of the Government. And, with due respect for these gentlemen, I advise you, as long as the Capitalist system lasts, to vote for gold.” -- George Bernard Shaw, Irish Playwright Fineness - The proportion os a precious metals purity. For instance .999 silver is 999 parts of 1,000 parts pure. Gold and Silver Terms
24 karat gold is softer and wears faster. This is why those in pioneer days would bite gold to test whether it was real. Most jewelry is made of a mixture of gold and other metals for longer durability. Rarely will you run into 24 karat gold. Most U.S. gold jewelry is from 10k to 14k, and occasionally 18k. “Gold and silver (especially silver) have been real money over and over again, in all ages and on all continents.” -- Howard Ruff, Author and Publisher Gold and Silver Terms Gold Bullion - Gold Bullion is nearly pure gold. Gold bullion is usually from 22 to 24 karat purity. Usually it is sold in 1 ounce, 10 ounce, 100 ounce, and 1,000 ounce gold bars. The most popular form of gold bullion is one ounce coins like the American Eagles, or Canadian Maple leafs. Gold Buying Scams - Gold buying scams are used by unscrupulous gold buyers to cheat you out of your gold. Like any industry that exists in America today there are always a few shady characters to take advantage of the unsuspecting clients. Gold Grams - The grams used in measuring gold are different then the grams most people see on a home scale, or a postage scale. Gold is weighed in Troy ounces. Postage ounces, called avoirdupois ounces, are not the same as Troy ounces. Gold and other precious metals are sold in Troy ounces. Troy ounces are heavier then postage scale ounces. There are approximately 31.1 grams in a troy ounce. Gold buyers weigh your gold an a scale to determine how many grams of gold you are selling. Here’s how to figure the Price of Gold Per Gram. Gold Marks - There are many types of gold jewelry, and costume jewelry. By law much of this jewelry must be marked to identify what it is. These markings help consumers, jewelers, and gold buyers to understand what they are looking at. Learn to identify gold jewelry by it’s Gold Markings. Gold and Silver Terms Unfortunately even fake gold and silver can be marked as real when it is not. For that reason a mark must be verified by further testing. A mark is simply a starting place, not proof that a piece of jewelry is real. It is quite common to find silver plated jewelry marked as .925. Gold Manipulation - While the price of gold and silver have been rising for some time, prices have been kept artificially low by central banks. This keeps fiat currencies values artificially higher than they should be. Even with price manipulation gold and silver continue to rise as governments worldwide contine to overspend. Learn more about Investing in Gold Gold or Silver Plated - Jewelry that is gold plated or silver plated, has a very thin layer of gold over a cheaper metal to make it appear like gold, or silver. It is worth little except to wear for appearance. Also see Silver Plated Flatware Gold and Silver Terms Gold or Silver Filled - Gold or silver filled jewelry may appear the same as gold or silver jewelry, but it has a layer of gold bonded to a base metal. Generally more precious metal is used than with gold or silver plated jewelry. This jewelry may last from 5-30 years before wearing through. It is worth very little even as scrap. Gold Standard - The gold standard is the system whereby all currency in a country is backed by physical gold, or silver. The United States was once on the gold standard. Statist politicians hated it because it restrained the growth, and power of government. See what the experts have to say in our Gold and Silver Quotations. Gold and Silver Terms “An almost hysterical antagonism toward the gold standard is one issue which unites statists of all persuasions. They seem to sense... that gold and economic freedom are inseparable.” -- Alan Greenspan, former Federal Reserve Chairman Gold Testing - Gold buyers test gold to determine the actual karat weight of the gold. This can be done with an electronic gold tester, or an acid test. If a piece is suspect both tests may be used. Gold is tested because not all gold is correctly marked, or genuine. See Buying Gold Karats Gold and Silver Terms Holding Periods - Holding periods refers to the time a gold buyer must hold your items before they can sell them. These holding periods exist to give the consumer and the police time to investigate a Gold Theft. These holding periods are set by the state or local government entities. Honest Money - Honest money is the opposite of fiat currency. It retains it’s value. It is not diluted by printing of more unbacked bank notes. This continued printing dilutes the value of the current currency. That is why gold and silver are called honest money. “For if human liberty is to survive in America, we must win the battle to restore honest money.” -- Bix Wier, at www.roadtoroota.com Inflation - Inflation is when prices of goods and services rise. This is due to the dilution of the money supply when Countries, or their central banks print more money. This makes the money you are holding worth less. It’s like taking whiskey and watering it down with water. Soon it’s not worth anything. That’s why paper money loses value over time. Gold and Silver Terms
Junk Silver - Junk silver refers to circulated coins minted in the U.S. prior to 1965. Many of these coins are 90% silver, and worth far more than their face value. These coins are in fair condition due to having been in general circulation, and may have no numismatic (collectible) value. They are held by people as a hedge against inflation, or in case of a the failure of a country’s paper currency. Karat - Karats describe how pure gold is. A karat is 1/24 pure gold by weight. Pure gold is 24 karat or .999 fine gold. Lower karats are alloys of gold, and other medals. Gold jewelry is almost never made of 24k gold since 24k is very soft. For more on Karats see What is a Karat? Metal Softness - Precious metals like Gold, Silver, and Platinum are soft metals. When made into jewelry they are usually mixed with other metals to make them more durable. These mixes are display as karats or decimals. For instance 22k gold would be .917 while 12 k would be shown as 12k or .500. Popular karats (purities) of gold are 10k (.417) 14k (.583) and 18k (.750). In silver .925 is also known as Sterling silver. Most Sterling Silver is marked as Sterling. Pre-1965 American coins are 90% silver (.900). Pre-1965 Canadian coins are 80% (.800). Silver bullion is .999 silver. Silver bars, rounds and AmericanSilver Eagle coins are .999, and must be marked as .999 on their face. Platinum in usually a purity of .950, .900, or .800. Purer platinum is very soft, and easily bent. Paper Gold and Silver - Paper gold and silver is just that. Paper refers to owning stock, or owning a certificate exchangeable for gold and silver. The fact that is paper means it may be problematic, as compared to Physical gold, or silver. Gold and Silver Terms Pennyweight - 1 pennyweight = 1.55517384 grams. Abbreviations are Pw, Dwt, and Pwt. It takes approximately 20 pennyweight to make a troy ounce. Gold and silver prices are in troy ounces. Honest Gold Buyers usually do not buy using pennyweights. When a gold buyer offers you $20.00 per pennyweight they are really only offering you only $12.86 a gram, or $400.00 an ounce for your gold. Many in the jewelry industry use pennyweights to measure gold and silver. To convert a pennyweight price to a gram price take the $20.00 example above and divide by 1.555. The pennyweight originally came from the British system, when a pennyweight was the weight of an English penny. Also see What is a Pennyweight? Gold and Silver Terms Physical Gold and Silver - Physical gold and silver are simply that; they are the real thing. Buying physical gold and silver refers to owning gold and silver, and taking possession of the metals yourself for safekeeping. This means you have them physically in your possession. You may also like to learn about Gold Storage. Price Fluctuation - Gold, Silver, and all metals are commodities. This means their prices can fluctuate not only daily, but hourly, and minute by minute as these commodities are traded electronically across the world. Events in a country across the world can cause gold to shoot up or down at a moments notice. In addition some larger banks are able to manipulate gold and silver prices with rapid fire electronic trading. Fear of currency drops or actual drops in country’s credit rating can cause moves towards gold purchases, as well. Gold and Silver Terms Real Money - Real money is gold, silver, copper, platinum, and other precious metals. It is rare and precious. Like honest money, real money is the opposite of fiat currency. It retains value. It is not diluted by printing of more unbacked bank notes, which dilute the value of the current currency. This dilution is called inflation. America’s founding fathers felt so strongly about money that they stated “Only gold and silver could be used as money.” When fiat currency becomes worthless through inflation, real money rises in value. Refining - Refining is separateing pur silver and gold from other metals. Scratch Testing - Scratch testing is done by rubbing off a little gold, or a deeper filing, if the gold is suspected of being fake. Testing with acid can be used to see what karat weight the gold is. It is also referred to as acid testing. Gold dealers will usually ask your permission, prior top doing this test.
Silver - Silver has many industrial uses, as well as it’s anti-bacterial use, and use in coins. Sterling silver usually contains 92.5% silver, or 925 parts per thousand silver. Older circulated silver coins are usually 90% silver. Silver has also been used as money for thousands of years. Silver’s usage, and short supplies can cause it to go up in value, as fiat currencies decline. Click the following link for more info on Silver’s Uses. Silver Bullion - Silver Bullion is called fine silver. It is .999% pure, raw silver. Usually it is sold in 1 ounce, 10 ounce, 100 ounce, and 1,000 ounce silver bars, or as silver bullion coins like the American Silver Eagles. Silver Bullion is very desirable due to the highest silver content Gold and Silver Terms Silversmith - A silversmith is a craftsman who makes objects from gold or silver. Spot Price - Gold, silver, and other precious metals are traded as commodities. The spot price is the price large buyers can buy commodities at for immediate delivery. Generally local coin, and bullion dealers will sell these commodities for spot plus a small markup. Usually buyers of scrap gold and silver buy scrap for refining at a percentage of the spot price of gold, or silver. Unscrupulous, We Buy Gold, or mail order dealers usually pay 20-40% of spot. Honest Gold Buyers usually pay from 65-75% of spot. Honest Gold Dealers usually buy common gold and silver coins for spot, less a percentage. And sell for spot plus a small markup. Sterling Silver - Sterling silver is silver with a .925 percent of silver content. Some coins are .925 silver, such as pre-1920’s Canadian coins. Silver flatware sets are commonly made from .925 sterling silver or from plated silver. Gold and Silver Terms Troy Ounce - 1 troy ounce = 31.1034768 grams. So to come up with a price to buy your gold or silver, first it is weighed to see how many grams the item weighs, then multiplied by it’s purity. The troy weights system was developed by the Romans. There are 32.1507466 troy ounces in 1 kilogram. Under-karated Gold - It is fairly common to test gold marked as 14 karat and find it to be 12 karat, Many jewelers mix their 24 karat gold with other metals to make 14 karats. Evidently quite a few get the mix wrong, or somebody is cheating their customers. White Gold - Gold alloy of yellow gold mixed with silver, palladium, nickel or other whitening metals. It comes in the same karats as yellow gold, and has the same value based on it’s kaqrat. Gold and Silver Terms Have these Gold and Silver Terms been useful to you? Do you have any questions about any other term? Use my Contact Me Form and I’ll do my best to help you. We constantly update this Gold and Silver terms page. Return to Top of Gold and Silver Terms Gold and Silver Terms Updated 02/11/2012
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Gold - Gold has been used as money ever since 500 BC. Pure gold is known as 24 karat or 24K. Usually gold is from 10k to 24k which indicates how pure the gold is. For instance 14k would be 14 parts gold mixed with 10 parts of base metals. The lower the karats the lower the gold content, and the lower the value. Gold may be marked as as 10K-24K, but is tested to be sure what karat it is, prior to purchase by a gold buyer.
Gold and Silver Terms