Jul 20, 2008 | gold, video
Last Wednesday, I wrote about the potential seigniorage of the 2008 American Buffalo 24-karat Gold Coins and suggested that some may be used as an investment. Remember, I am not an investment advisor and don’t pretend to know what I am talking about in that area. But if you are watching the market price of gold as an investor or interested bystander, you know that it has been in a real roller coster ride this year.
Since writing about the gold Buffaloes, gold has dropped to $954.60 (as of 5:15 PM, NY Time) from Wednesday’s close of $975.10. It may have a lot to do with the upward movement of stocks on the New York Stock Exchange—NASDAQ was down because of lower than expected earnings reports from Microsoft (MSFT) and Google (GOOG), two technology sector bellwethers.
As an interested bystander, I was wondering about gold in this market. I was pointed to TheStreet.com, the site started by financial guru Jim Cramer, to see what they had to say. I came across the following video report about investing in gold during these economic times:
It is an interesting take on the market. My posting it here is by no means an endorsement of these opinions or a recommendation. You should consult with your investment adviser (if you have one) and make the decision that fits your investment goals. My interest is as a coin collector but would like to see some value from the collection as I consider the eventual passing of my collection to my family.
Jul 16, 2008 | gold, US Mint
While I was in surgery, the US Mint announced that they will be accepting orders for the new American Buffalo 24-karat Gold Coins starting on July 22, 2008. In addition to the one ounce coin that has been issued since 2006, the Mint will add half ounce ($25), quarter ounce ($10), and one-tenth ounce ($5) fractional issues. They will also sell a four-coin sets that contain one coin in each size.
I was curious as to what premium the Mint was putting on these coins. Using the spot price of $975.10 (as of market close, 4:00 PM on July 15), I took the Mint’s announced price of these coins to create the following table:
| Option |
Price |
Metal Value |
Premium |
Premium Pct |
| Proof One Ounce |
$1,199.95 |
$975.10 |
$224.85 |
23.06% |
| Proof Half Ounce |
$619.95 |
$487.55 |
$132.40 |
27.16% |
| Proof Quarter Ounce |
$329.95 |
$243.78 |
$86.18 |
35.35% |
| Proof Tenth-Ounce |
$159.95 |
$97.51 |
$62.44 |
64.03% |
| Proof Four-Coin Set |
$2,219.95 |
$1,803.94 |
$416.02 |
23.06% |
| Uncirculated One Ounce |
$1,059.95 |
$975.10 |
$84.85 |
8.70% |
| Uncirculated Half-Ounce |
$539.95 |
$487.55 |
$52.40 |
10.75% |
| Uncirculated Quarter-Ounce |
$289.95 |
$243.78 |
$46.18 |
18.94% |
| Uncirculated Tenth-Ounce |
$129.95 |
$97.51 |
$32.44 |
33.27% |
| Uncirculated Four-Coin Set |
$1,959.95 |
$1,803.94 |
$156.02 |
8.65% |
If you are into buying gold coins for investment purposes, it looks like the uncirculated one-ounce and multi-coin sets are the best bargains. Since I am not an investor, I will be purchasing the proof one-ounce coin to go with my 2006 and 2007 coins.
Jul 1, 2008 | coins, gold, US Mint
While checking the US Mint’s Public Release RSS Feed, there was an announcement for the coming sale of the American Buffalo fractional coins. However, the press release pointed to by the feed does not exist. There is no listing for these coins in the online catalog and the product release schedule does not announce a date for their release.
The information in the RSS feed was as follows:
Washington – The United States Mint announced today that it will begin accepting orders for fractional denominations of the American Buffalo Coin, now available in proof and uncirculated versions, on July 15, at 12 noon Eastern Time. Both versions of the coin will be offered in four sizes – one ounce, one-half ounce, one-quarter ounce and one-tenth ounce, as well as a four-coin set which contains one coin in each size.
I am looking forward to see how the Mint treats the fractional Buffalo coins. Let’s see what happens over the next few days regarding this pseudo announcement.
Jun 27, 2008 | ANA, coins, gold, US Mint
Another reason to attend the World’s Fair of Money® at the end of July in Baltimore is to be there for the unveiling of the 2009 Ultra High Relief Double Eagle Gold Coin.
The US Mint announced that US Mint Director Ed Moy will participate in the show’s opening ceremony and then officially open the Mint exhibit that will feature the one ounce gold coin that will go on sale in 2009.
The coin&rsqou;s design will be a high-relief $20 gold piece on a double-thick, 24-karat gold planchet (sometimes called a piefort) 27 millimeters in diameter. The design will feature Augustus Saint-Gaudens original 1907 design where the date will be in roman numerals (MMIX). The inspiration for this coin came from 1907 when the Mint tried to strike an experimental double eagle using two stacked $10 eagle planchets. When it was realized that congress would have to approve the striking of the coin for circulation, the project was abandoned and the test pieces were melted.
Aside from the date, the only difference between the 1907 test pieces and the 2009 bullion issue is that the the motto “In God We Trust” will be added over the rising sun as it appeared in 1908.
May 17, 2008 | CCAC, CFA, coin design, gold, US Mint
Today, I noticed that the US Commission of Fine Arts posted the final minutes from their April 17, 2008 meeting. The CFA is part of the coin design bureaucracy that is required to approve, reject, or recommend changes to coin designs. These minutes approve of the 2009 Double Eagle gold coin US Mint Director Edmund Moy proposed the design to the Citizens Coin Advisory Committee.
The CFA approval reads as follows:
Confirmation of recommendation on the 2009 Double Eagle Gold $20 ultra-high relief coin based on 1907/08 design by Augustus Saint-Gaudens. Mr. [Thomas E.] Luebke [Secretary] said that the proposal had been circulated to the Commission members for a vote prior to the Commission meeting due to the U.S. Mint&rsqou;s tight production schedule and the similarity of the proposal to a historic coin design; he asked the Commission to confirm the recommendation. He said that the Mint’s proposal was to reissue a coin from 1907 designed by Augustus Saint-Gaudens: the original high-relief design was minted for one year, then adapted by the Mint to a low-relief coin that was issued from 1908 to 1932. The only proposed changes to the 1907 design would be to update the minting year, which will continue to be rendered in Roman numerals; to add a rim which will improve the production process; and to add the phrase “In God We Trust” which was historically included on the coin from 1908 onward. Upon a motion by Mr. [Earl A.] Powell [Chairman] with second by Ms. [Dianna] Balmori, the Commission confirmed its recommendation to approve the updated design with the comment that the Roman numerals for the issue date be as similar as possible to the original design in scale, spacing, and character.
As for the necessary legislation to allow the Mint the produce these coins, H.R. 5614 passed the House of Representatives on May 15 with a unanimous vote. The Senate’s version, S. 2924, is still in committee.
May 7, 2008 | BEP, cents, coin design, coins, currency, gold, Israel, legislative, US Mint
It has been a week since my last post and I thought an update was in order. I will follow up with a post for some of these at another time. This will give me something to do while proctoring the final exam in an information security course I am teaching this semester.
I recently received four polymer 20 New Israeli Shekelim notes from a dealer in Israel. These notes are the first that Israel is producing on polymer “paper” that was developed by the The Reserve Bank of Australia. Israel is another in the growing list of countries to start using the polymer material. The notes include the same security features as rag-based notes and include a new clear window with a watermark that is said to be extremely difficult to counterfeit. While the polymer substrate costs little more and the production is only marginally more expensive, the benefit will come from the reduction in counterfeiting and the durability of the note. Polymer will last three-to-six times longer than rag-based paper.
According to unconfirmed reports, the Bureau of Engraving and Printing is experimenting with different types of polymer paper for both US and foreign production. If the BEP can adjust their equipment to print on polymer paper, they can solicit business from other countries to produce their currency. Once the BEP builds its portfolio, they are prepared to go to congress to recommend discontinuing production of the one-dollar note. Until then, the BEP will continue to produce one-dollar notes in order to keep workers in key congressional districs in the Washington, DC and Fort Worth, TX areas employed. Remember, 95-percent of the BEP’s production are for one-dollar federal reserve notes.
The spot price of gold continues to drop as the dollar gains against the Euro and the Pound. Prices are returning to pre-2008 levels. However, buyers of gold collectors coins from the US Mint has not seen their prices reduced. While the Mint repriced gold and platinum coins in February and March, the Mint has not lowered their prices with the market. The one-ounce American Gold Eagle proof coin is still $1,199.95, the new price given in February. With gold closing at $876.88 today, the $327.07 premium is 36.8-percent higher than the spot price. This will cause problems for those who buy at thiese prices when reselling these coins.
While we are talking about gold, the Original Saint-Gaudens Double Eagle Ultra-High Relief Bullion Coin Act was simultaneously introduced in both the House (H.R. 5614) and Senate (S. 2924). These identical bills will allow the Mint to strike high-relief $20 gold pieces using the Augustus Saint-Gaudens original 1907 design. The date will be in roman numerals and the motto “In God We Trust” will be added over the rising sun as it appeared in 1908. The coin will be on a double-thick, 24-karat gold planchet (sometimes called a piefort) 27 millimeters in diameter.
The US Mint finally posted its online product schedule for the rest of the year. The only thing that jumps out at me is that the 2008 American Buffalo 24-karat gold proof coin is not listed.
On Tuesday, the House of Representatives began to debate H.R. 5512, the Coin Modernization and Taxpayer Savings Act of 2008. The primary provisions of the bill will allow the US Mint to determine the size and composition of US coins without having to ask congress for permission. It also specifies that following 2009, the one-cent coin would be “be produced primarily of steel and treated to impart a copper color to its appearance similar to one-cent coins produced of a copper-zinc alloy.” Debate was cut off on procedural grounds by Republican lawmakers who oppose the bill.
It was just another uneventful week!
Apr 23, 2008 | Eagles, gold, silver
In the volatile commodities and money markets, the spot price of gold dropped under $900 per ounce briefly as the dollar rose against the Euro. Pressure is being placed on the Euro as analysts think it may not be able to maintain its current value against the weakening dollar and the high price of crude oil.
Bloomberg is reporting that analysts believe that the price of crude oil is unsustainable and will weaken other non-dollar currencies as the price falls. Speculators are selling gold futures looking to make more money with oil and currency futures. This has lead some analysts to believe that gold will fall below $900 by the end of the year citing lows in the range of $860 to $880.
Silver is also trading lower but above the $17 mark. Analysts speculated that silver will slip below $17. Nobody expects the prices to reach the levels seen in 1980.
For numismatics, the lower spot price of precious metals should lower the cost of bullion coins, such as the American Eagles. However, with the popularity of collecting earlier common date gold coins, those prices may not fall as much since their numismatic value may help them maintain their prices.
Feb 16, 2008 | coins, gold, US Mint
On February 8, 2008, a report from the Moscow News reverberated in both the numismatic press and found its way into some mainstream media outlets said that a couple in Egypt found a 1933 Saint-Gaudens $20 Gold Double Eagle. The forbidden coin, which there is only one legal tender specimen, could be the most valuable coin if it is real.
Online forums have parsed the words of this short article noting that the line “Specialists believe that the double eagle found in Egypt could be part of Theodore Roosevelt’s 1933 collection of coins redesigned by famed American sculptor Augustus Saint-Gaudens and given to King Farouk of Egypt as a present,” contain significant factual errors. For instance, Roosevelt did not collect coins, but did commission Saint-Gaudens to design the coin and owned a high-relief coin. Even if Roosevelt did collect coins, he died in 1919 and would have never collected this coin. Saint-Gaudens died in 1907.
Further, evidence discovered by David Tripp and published in his book Illegal Tender suggests that the Farouk coin was sold to an emissary by a dealer.
After parsing the words, you have to realize that this is a story by a Russian news organization quoting a Qatar news organization reporting an event in Egypt. Aside from translation being an issue, even some collectors are confused by the provenance of these coins. So the mistakes could be understandable. But is it a real coin?
The 1933 Saint-Gaudens Double Eagle coin sold in 2002 for $7.6 million was assumed to the be the Farouk coin based on the assumptions of its travels until its confiscatio But part of the evidence was that a 1933 Double Eagle coin was removed from the 1954 auction of King Farouk’s coin collection. Although a coin was confiscated from British dealer Stephen Fenton who testified that it was the Farouk specimen, no evidence exists to prove the claim.
Since the sale of the only legal tender 1933 Double Eagle, ten coins found by the family of the late jeweler and coin dealer Israel Switt where authenticated as genuine by the US Mint and subsequently confiscated them. While the family is suing the government for the coins’ return, it was though that this may be the last of the escaped Double Eagles… until now.
If the coin is real, the US government considers the coin government property and illegal to own since it was never released into circulation. Although the US Secret Service has not commented on this story, history suggests that the coin will be confiscated should it return to the United States.
If the coin is real, the $15 million estimate in the Russian article may be possible, but could be too expensive. Should the coin be accurately linked to King Farouk with convincing evidence, $15 million may be a low estimate. However, it would have to be sold overseas to prevent its confiscation by the US Secret Service.
This may not be the last we hear of this coin. But I still want to know how the grandfather of this tailor came to own this coin. Even in 1954, the coin was known to be very rare, so how did it end up in a box in the bottom of a closet? It will make an interesting story!
Feb 2, 2008 | BEP, coins, gold, US Mint
On Friday, the US Mint announced that the American Buffalo 24 karat gold coin will begin selling on Tuesday, February 5. It was noted that the release coincides with the Lunar New Year that begins on February 7 since the number “8” is traditionally associated with wealth and prosperity in Asian cultures. For 2008, the Mint will be producing special packaging associated with this occurrence.
Although the US Bureau of Engraving and Printing has been offering the Lucky Money Collection products for a few years, this is the first time such a product is being offered by the US Mint. Of course, it is easier for the BEP to offer such products using the properties of the serial numbers to promote these products. Also, it should be noted that Mint Director Edmund Moy is the first Asian-American to hold this position.
Notably different will be the price of the proof coin. With the price of gold at historical highs ($907.90 when the market closed on Friday), the Mint has priced the coin at $1,018.88. The last price for the 2007 American Buffalo was $899.95. The press release notes that “as with all precious metal numismatic products, a future pricing change may be required.”
Given the state of the economy, it will be interesting to learn how this product will sell. I know I will wait before purchasing.
Jan 19, 2008 | gold, legal
It was reported on the website AccessNorthGa.com that police was able to stop a conspiracy to steal coins from the Dahlonega Gold Museum. It began when museum staff was tipped off by an anonymous caller on Christmas Eve. Officials then contacted one of the alleged co-conspirators who supposedly visited the museum and researched the value of the coins.
“We put them on notice that we knew about the conspiracy and none of the coins would be stolen,” Lumpkin County Sheriff Mark McClure said. And, “We would be definitely looking to charge individuals if that did occur.”
Details about the conspiracy was provided to the Numismatic Crime Information Center, an organization that maintains a database and provides information to law enforcement about numismatic crimes.
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