Investing In History Precious Metals Dealer Gambles On Silver Ingot

When the monthlong runup in the price of silver hit $6 an ounce a couple weeks ago, a lot of silver investors were happy to sell and take their profits.

But Spokane precious metals dealer Bill Graham was buying.

And he’s betting he can sell his latest investment - an 84 Troy pound silver bar - at more than twice that $6 price.

Graham, the owner of American Coin and Vault, isn’t expecting silver prices to hit $12 or $15 an ounce.

“The pure silver value is only about $6,000 or $6,500,” Graham says. “But what we’re dealing with here is history.”

Dealing through a computer network a couple of weeks ago, Graham acquired a silver ingot recovered in one of the largest sunken treasure discoveries in history.

The ingot was recovered in 1985 by Treasure Salvors Inc. from the wreck of the Nuestra Senora de Atocha.

Graham is offering the ingot for $15,000.

Graham has been very successful as a precious metals dealer over the past 15 years, and a big part of that success is his sense of timing. And with interest in silver peaking along with the recent publicity concerning silver prices, Graham decided this is a good time to buy sunken treasure.

“Any time there’s volatility in the market, whether it’s up or down, we get real busy here,” Graham says.

Graham got into the precious metals trading business in the late 1970s, when the Hunt brothers’ adventures created the liveliest silver market in a half century. While he remains active in the business, Graham has turned management of American Coin over to his son Shan.

American Coin doesn’t deal in paper transactions for precious metals. It buys and sells the real thing.

And it’s been moving more silver over the past six months than at any time since the last big run-up in silver after the outbreak of the Persian Gulf War.

But unlike then, the activity has been on a steady, measured increase this time around.

“When the Gulf War broke out,” Graham recalls, “in one day we sold a half million dollars worth of silver. We used up all of the silver Sunshine Mine Co. had stored in its vaults. They had to go to the secondary market just to meet our shop’s demand.”

Graham became interested in the Atocha treasure about a year ago when a display of Atocha gold, silver and coins was touring jewelry dealerships throughout the country.

“When the Atocha display came through town, we got five phone calls a day inquiring about Atocha coins,” Graham recalls.

Then, with silver on most of his customers’ minds, he saw the availability of the Atocha silver ingot on the computer network a few weeks ago and decided to acquire it.

The Atocha, a Spanish treasure galleon laden with tons of gold, silver and other precious cargo, sank in a hurricane off the Florida keys on Sept. 6, 1622. Treasure hunters searched for the fabled ship for decades before Treasure Salvors Inc. made its discovery on July 20, 1985.

Over 1,000 silver bars were listed on the ships manifest, according to the ingot’s authentication certificate. The majority of those ingots were the property of individuals, although 133 of the bars were in boxes marked with the red crown mark of King Philip IV. Most of the bars were mined and processed in what is now Bolivia.

The bar acquired by American Coin is among the better preserved ingots that were recovered, Graham says. The ship’s manifest number, assayer’s bite, purity number and other markings are clearly imprinted in the heavy grey slab.

Investors who supported the Treasure Salvors project, as well as participants in the recovery of the treasure, were paid with the treasure itself. So, Graham says, as some of those investors and workers sell their shares of the treasure to get cash, bits and pieces of the treasure are showing up on the open market.

Alex Burgess, American Coin’s diamond broker who also is knowledgable about treasure recovered from the Florida Coast area, warns that some of the Atocha silver and gold is being melted down into coins and offered for sale as Atocha coins.

“While they are real Atocha gold and silver,” Burgess said, “they aren’t the actual coins that were recovered from the ship. Buyers should be sure they get authentication papers if they buy coins.”

Graham says he is in the process of acquiring some of the genuine Atocha coins, which will go on display with the ingot for eventual sale.

Graham says he’s received several offers for the ingot already from other dealers. But he prefers to display his personal piece of history at American Coin for a while, and then hopes it will end up in the hands of one of his customers.

Someone who appreciates the history behind this hunk of metal that rested on the bottom of the Atlantic Ocean for more than 350 years.