From the Publishers of Coins and Numismatic News
Gold & Silver SIZZLE in a Hot Market
Inside: • Gold shows paper’s weakness • Gold and silver business booms • Diversify investments with silver, gold • American Eagles more than just bullion • Modern commemoratives bring proﬁts • Coins to retire with • Keep taxes at bay
TABLE OF CONTENTS
Eternal Value: Gold shows paperâ€™s weakness by Patrick A. Heller
Gold & silver business booms by Debbie Bradley
Precious metals part of investment mix by Debbie Bradley
Opportunity Knocks: American Eagles more than just bullion
Online Poll: Are you buying more silver and gold?
Modern Commems: Unusual vein of profits? by David L. Ganz
Old or new? Profit found in both by David L. Ganz
Keep taxes at bay: Treat coins as heirlooms by Eric Jordan
1794 dollar: Coin price moves ever higher by David L. Ganz
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FROM THE EDITOR
Open the door to precious metals â€œMay you live in interesting times,â€? is the old Chinese curse. Times are most assuredly interesting, but rather than being a curse, I think our present interesting times offer great opportunities for those who are willing to take the risks that are associated with them. That is why the editors and contributors of Coins magazine and Numismatic News teamed up to bring you this special online issue of Precious Metals. The subject area was chosen because day after recent day gold has set new all-time highs. Silver has returned to levels last seen in the boom year of 1980. Ah, those were the days. Fortunes were made. Precious metals helped some coin dealers establish themselves as permanent players in the numismatic market for the next 30 years. The present precious metals boom will also establish a new crop of winners as permanent players in the market for the next 30 years.
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Will you be one of them? There are many things to think about. It is impossible to include everything about precious metals in a single package. But I think we have assembled a useful group of articles to help you navigate in present market conditions. Where is gold going? In what form should you buy it? Writers here have addressed these questions and others. Some of the contributions presented here put the precious metals market in historical context. As good as the market has been, metals donâ€™t trend up in a straight line. It pays to be prudent in deciding whether to get into the market and to what degree. Naturally, there is a strong numismatic component in Precious Metals. It is important to remember that carefully selected collectible coins can generate large profits over time. As an historical note, the price performance of a 1794 dollar is traced by David L. Ganz. This is interesting because records of its
price movements date back to the late 19th century. Coin collectors have been active in years when gold and silver have gone up and in years when they have gone down, during wars and during economic hard times. The remarkable thing is not that the 1794 dollar has gone up in every single year. It has not, but it has moved higher relentlessly over the long run. This shows the power of the numismatic premium derived from inherent collector demand. How rewarding all of this will be depends on the choices you make and on the actions of the marketplace going forward. It will be interesting. An educated participant will minimize any chance that this will be a curse and maximize the opportunities that are all around us.
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WHERE’S GOLD’S TOP?
BY PATRICK A. HELLER
Eternal value Gold shows paper’s weakness To write that gold will hit $2,000 has no meaning if you don’t know the state of the U.S. dollar, central banking and monetary history. It also helps to know why timing is important. With these issues in mind, let’s go forward together to my conclusions as to where gold is heading. Gold is a metal with many properties that made it ideal for use as money thousands of years ago. It was relatively scarce, it was durable, did not deteriorate in the presence of most other substances found in nature, it was relatively easy to fabricate even with long ago technology, a small quantity could go a long way and it was portable. Some of the earliest coins were made of a gold alloy called electrum, which was a naturally occurring alloy that could be used without first requiring a refining process. Gold proved much more useful as a store of value for large sums. All of the gold recovered thus far in history, between 5 billion and 6 billion ounces, could fit within the boundaries of one typical American homestead. Over history, there have been thousands of experiments using some other standards as a medium
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of exchange. When paper currencies first appeared in Europe in the 17th century, their acceptability depended on the ability of the issuing government to redeem them on demand mostly for gold (and sometimes silver or another tangible asset). In the American Revolutionary War, the paper Continental Currency promised to “pay the bearer in Spanish milled dollars or the value thereof in gold or silver.” When it became obvious to the populace that this was an empty promise, the value of Continental Currency fell to almost nothing. This American experience with worthless paper money is the major reason that Article One, Section 10 of the U.S. Constitution states, “No State shall ... make any Thing but gold and silver Coin a Tender in Payment of Debts.” For dozens of centuries, gold and silver in physical form never failed as a circulating medium. However, every paper currency ever issued has eventually failed, excepting those now in circulation about which you can only say that they have not failed – yet. In today’s world, with transactions often taking place between parties who are separated by hun-
dreds or thousands of miles, physical gold might seem to be a less convenient medium of exchange. It would be a whole lot easier to transfer pieces of paper or simply computer code to handle monetary transfers. However, such systems, such as the U.S. monetary system coordinated by the Federal Reserve, have no ultimate backing other than “the full faith and credit of the U.S. government.” If you don’t already know, the value of the full faith and credit of the U.S. government is slipping fast. In fact, recent statements by U.S. President Barack Obama, Treasury Secretary Timothy Geithner, Federal Reserve Chair Benjamin Bernanke and the presidents of the Federal Reserve Banks of Boston, Chicago and New York that they want the value of the U.S. dollar to drop even more in the near future are a near certain guarantee that is exactly what will happen. The price of gold represents a report card on the U.S. dollar, the U.S. economy and the U.S. government. An ounce of physical gold on one date is still worth an ounce of physical gold on another day. Its price, as measured in U.S. dollars, is what changes. What has really been happening for more than the past
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10 years is that the value of the U.S. dollar has been depreciating while gold remained stable. Another way of examining relative value is to divide the Dow Jones Industrial Average by the spot price of gold to see how many ounces of gold it would take to buy the Dow. On Dec. 31, 2001, the DJIA closed at 10,136.99 and gold at $279. At that time, it would have taken 36.33 ounces of gold to acquire the Dow. The DJIA closed Oct. 14 at 11,094.57. As I write this on the evening of Oct. 14, the latest gold spot I see is $1,378, which means that it now only takes 8.05 ounces of gold to buy the Dow. Or, if you assume that an ounce of
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gold on Dec. 31, 2001, is still worth an ounce of gold on Oct. 14, 2010, then the value of the Dow Jones Industrial Average has fallen by 77.8 percent over close to the past decade. This closely parallels the 79.8 percent decline in the value of the U.S. dollar versus one ounce of gold over the same time frame. Gold and silver have been classic hedges against the suffering inflicted by the inflation of paper currency supplies. Those who have owned gold over the past decade have protected their wealth better than almost everyone who didn’t own it, no matter which nation you lived in. In the past month, numerous
countries have taken steps to try to stem the further decline in value of the U.S. dollar. Chief among them are Japan, Switzerland and Brazil. There is a developing sense that each nation wants to depreciate its own currency by more than the U.S. dollar in order to promote exports and preserve domestic jobs. An article just released by a Chinese think tank used the term “currency wars” to describe developing efforts around the globe for major nations to destroy the value of their respective currencies. In such an environment, more private citizens and central banks are seeking safe harbors to protect their accumulated wealth. It seems
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WHERE’S GOLD’S TOP?
like almost every week, another central bank reveals that it has been adding gold reserves. Not only are more people acquiring some form of gold, the greatest percentage increase seems to be demand for physical metal. There are a growing number of reports of suspicions that central banks (especially the Federal Reserve) do not possess all the gold they report in their reserves. At least some of the gold held in America’s COMEX market and the London Bullion Market Association vaults may be subject to multiple ownership claims. Similarly, some of the physical gold that is allegedly owned by exchange traded funds may be out on lease or stored in unallocated storage accounts that could be subject to multiple ownership claims. In my judgment, the safest form of gold to own is the physical metal that is either in your direct possession or in a segregated storage account under the owner’s name. Gold stored in unallocated accounts and maybe even in allocated accounts may be subject to claims by the creditors owed amounts by the company operating the storage vault. I recommend owning physical forms of gold that are readily liquid and trade at the lowest premiums to their gold value. As the price of gold rises, premiums tend to decline, with the smallest drops experienced by forms that are already at low premium levels. Issues such as Austrian 100 coronas, Mexican 50 pesos, U.S. American Arts Medallions and even
10 PRECIOUS METALS
one ounce or larger ingots tend to get you the most gold for your money. Shop around for the best deal – and make sure you take reasonably prompt delivery! With the globe on the brink of an expanding currency war and so many other financial crises brewing, I now recommend a hard asset (gold, silver, and maybe even rare coins) position equal to at least 10 percent and maybe as much as 33 percent of someone’s net worth. Consider about half of this to be an insurance position that will be kept indefinitely. The other half can be kept for possible trading if the market appears to be at a temporary peak. It is not possible to foresee where the eventual long-term top will be for gold (or silver). I personally expect to see gold reach $1,600 by the end of January 2011 at the latest, and think it will surpass $2,000 before the end of 2011. Rather than trying to predict a price where I think gold will peak, I would rather describe the public psychology at the time. As we saw in late 1979 and early 1980, when almost everyone seems to be current with gold prices, when strangers waiting in lines talk about the benefits of owning gold, when barbers, shoe shiners, taxi drivers, hair dressers and the like talk about owning gold with their customers, that will be the time to liquidate your trading position. Another sign that could signal a market top is if record gold prices grab the front page headlines in local newspapers.
Coin dealers have another indicator that could tell them that the peak is near. That would be if customers simply start buying in a frenzy, where they are not doing their due diligence research before stepping up to buy. Back in January 1980, when there was a surge in the number of customers who simply came in to my company’s store to throw money on the counter and take whatever they could, without even worrying about the price, that signaled the end of the boom. I expect that the same behavior will again mark the next peak. In the long-term, gold will still be a stable unit of money. It will continue to be the benchmark against which all paper currencies will be measured. Gold will survive. I cannot promise the same for the U.S. dollar and other paper currencies. Patrick A. Heller owns Liberty Coin Service and Premier Coins & Collectibles (www.premier-coins.com) in Lansing, Mich., and writes “Liberty’s Outlook,” a monthly newsletter on rare coins and precious metals subjects. Past newsletter issues can be viewed at www.libertycoinservice.com. Other written commentaries are available at Coin Update (www.coinupdate. com). Heller’s radio program, “Things You ‘Know’ That Just Aren’t So, And Important News You Need To Know” is broadcast every Wednesday morning about 8:45-9 a.m. on 1320-AM WILS (which streams live and is archived at www.1320wils.com).
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BY DEBBIE BRADLEY
Gold & silver business booms When buying, don’t let emotions win Ross Hansen admits he’s a bit of a heretic. The president of Northwest Territorial Mint has been buying and selling precious metals for more than 30 years, and right now, business is booming. But don’t expect him to advise you to liquidate your other assets and buy heavy into silver and gold. Quite the opposite. “Don’t panic. Use common sense, and keep your portfolio in balance,” Hansen said during a recent telephone interview. And he puts that balance at 10 to 20 percent in precious metals assets. No more. “I have seen people here who have sold their homes to buy metal,” he said. To him, that’s not logical. “I tell people to invest logically, not emotionally, but most people believe in the doom and gloom and they get scared, and when they get scared they get panicky and they
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get emotional and they make bad investments.” So yes, buy some gold and silver, but be sensible about it, he said. Gold Maple Leaves and gold American Eagles are popular, Hansen said, but it’s different from what he saw two years ago when the financial crisis hit in earnest. “Then, a lot of people were buying fractionals,” Hansen said. He called it crisis investing. “They were purchasing small amounts of gold so they could use it as money if currency blows up. “This latest round you see people simply buying gold for gold’s sake,” he said. “Kilo bars are real popular right now at over $40,000. We sell those bars by the dozen.” As for silver, buyers like the 1ounce rounds and 10-ounce bars. Northwest Territorial Mint owns silver mines and makes its own rounds and bars, as well as rounds for such brands at Pan American. “We make a lot of silver for a
lot of different brands, but people are not as brand conscious as they used to be. They want clean looking rounds with a good name on them, but a low premium. And we are selling a lot of silver Eagles, too.” So where does Hansen see the price of gold and silver in six months? “I’m going to talk heresy here,” he said. “These current prices are not supported by any fundamentals.” Those fundamentals should reflect the cost of production of the mining industry taking into account labor, fuel, steel and the cost of environmental regulations. “With gold, we’re more than double the cost of production and with silver, more than triple,” he said. “All it is is we’re in a bubble. And people can argue about the reality of the bubble, but mainly we’re in a bubble because of a confidence crisis. People aren’t confident in the government, the global economic crisis, ...”
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CHASING THE MAGIC They call it gold fever. And if you ask Northwest Territorial Mint President Ross Hansen, people are infected with it now. “There is something magical about gold and silver,” Hansen said. “People have been killing each other over it for 5,000 years.” Look back at what happened during the first gold rush, he said. “People went nuts. They killed
each other,” Hansen said. And his great-grandfather was one of those who chased the dream. “I own his silver mines now,” Hansen said. Over time, hunderds of thousands of people have died in pursuit of gold and silver, he said. “There is an old adage: A lot more money has gone into the ground
But that’s nothing new, he said. Buying precious metals in the face of crisis has been going on for decades. “In 1972 I bought my first bar of silver and with it came a book that talked about the the collapse of the United States and its currency coming in the next couple of years.” When talk turns to crisis, people turn to precious metals, he said. “As we went through the 1970s we had stagflation under Ford and then real inflation under Carter. Then cowboy Reagan was going to get us in a nuclear war. Then that didn’t pan out so people were going to buy metal because of the collapse of communisim. “Then it was rush off and buy metal because of the first Gulf War in 1991. Prices skyrocketed and then plummeted. Then between 1992 and 1998 it was relatively calm. Then came a rush because of Y2K, and people were buying metal and wood stoves because electrici-
ty wasn’t going to work. That turned into a big goose egg and metal collapsed. Then there was 9/11 and everyone rushed to buy metal. Then there was the rush to buy metal because of the second Gulf War, then a rush again to buy because of the financial crisis on Wall Street. The next big crisis will be the end of the Aztec calendar in 2012.” “People will be prophesying about the end of the United States, famine and wars. It’s already starting to build.”
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than come out of it,” he said. “Mark Twain said it. A mine is a hole in the ground owned by a liar.” And although he believes in buying gold and silver, he wants people to do it wisely. “Get away from people who have a vested interest – gold miners, investers, fabricators,” Hansen said. “They want to keep the music playing.”
And that’s when Hansen issues his warning. “I’ve been doing this for 30 plus years,” Hansen said. “I’m tired of the hype. I want people to make logical investments, to use their brain and not use their emotions. “When you use emotion, you will make a wrong move every time.” By all means, buy some silver and gold, Hansen said, but do it wisely. “Gold needs to be a means to a quality of life,” he said. “It doesn’t replace quality of life.”
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BY DEBBIE BRADLEY
Now part of investment mix Rising gold, silver prices get public’s attention As prices of gold and silver keep rising, Joe Public is taking notice. And he wonders, should I get a piece of the precious metals pie? “There’s a lot going on, but it’s not because gold and silver is doing anything,” said Michael Haynes, Chief Executive Officer of American Precious Metals Exchange. “It’s still the same metal, still the same atomic number, but everything else around it is changing.” There is concern about the amount of potential inflation in the marketplace because of all the money the Federal Reserve has put
into the economy and the growing debt in the United States and globally, Haynes said. “As a result, people are waking up and saying, I’ve got to find a repository for some portion of my assets – not all of them – that if this continues at its current pace and direction, I have something that will retain value.” Some folks have already been participating in the precious metals market and have enjoyed “quite a nice run-up,” Haynes said. But now Joe Public is taking notice. “The general public is beginning to grasp what happened to
their investments in 2008 and looking for ways to protect themselves as we slowly dig out of this,” Haynes said. “From an economic perspective there is concern about how fast the economy is growing and recovering from the great recession and concern about the impact on purchasing power,” Haynes said. “The general view is that purchasing power in the next few years may decline faster than the economy can grow.” The real message for the public regarding gold and silver is asset allocation, Haynes said. Previously, assets were basically put into stocks,
“The general public is beginning to grasp what happened to their investments in 2008 and looking for ways to protect themselves as we slowly dig out of this.” —Michael Haynes
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COINS GOOD CHOICE FOR NEW BUYERS Right now, the only gold you own is on your left hand. You want to expand your precious metals holdings, but what do you buy? American Precious Metals Exchange CEO Michael Haynes recommends coins for the firsttime investor. And he suggests legal-tender coins from the U.S. and foreign governments. “Premiums for coins are somewhat higher with the sovereign governments,” he said. But what you’re paying for, in part, by buying government authorized coins is the assurance that they are gen-
uine. And they are more difficult to counterfeit. The investor can look at purely bullion coins, or at coins that may have both a bullion and numismatic value, he said. Take the Canadian silver Wolf, for example., he said. It has limited production but it is being sold like a bullion coin with a bullion coin premium. Then there is the silver American Eagle, which is a bullion coin with unlimited production. “A prudent buyer might say, if I can buy a bullion coin that has at least some possibility at being
bonds and cash. “The theory of asset allocation is you are looking for pools that have correlations in their movements that aren’t directly related to each other,’ Haynes said. But unfortunately, he said, during 2007 and 2008, those pools of assets didn’t give the kind of protection that was necessary in those economic times. By expanding into precious metals as assets, it helps balance the asset pool when the other components aren’t doing as well. “The proper way to look at this alternative investment category is
it’s a hedge, it is a safety place, it’s an insurance policy against where most of your money is invested,” he said. “Say 90 percent of your assets are in stocks, bonds and cash and 10 percent is in the metals complex. You really hope metals go to zero because then all the rest go crazy. But if the others lose, then you’re glad to have something like metals to offset it.” Because the prices for precious metals have risen dramatically in recent months, a lot of attention is being paid them as an investment.
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rare at some time and it costs the same, why not buy the one that has some (mintage) limit on it?” he said. Someone who wants to pay a lower premium can purchase gold bars, he said, but they aren’t as easy to liquidate and they are easier to counterfeit. A 400-ounce bar can be stamped .999 gold but only contain .700 gold, he said. “It doesn’t have Hershey’s chocolate in the middle, but the counterfeiter has made a lot of money,” he said. “It’s a lot harder to counterfeit a gold American Eagle.”
“Today, the metals complex is up the PR ladder and its visibility is becoming greater,” Haynes said. “For the foreseeable future, a metals complex is going to be part of a well-balanced portfolio. You can no longer say, ‘My stocks and bonds are safe.’” But remember, it is an investment. “This is not a day trade,” Haynes said. “You should be thinking about your investment portfolio. This is my retirement. We are talking some multi-decade element. That’s what you should be thinking about for this diversification.”
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U.S. GOLD COINS
Opportunity knocks American Eagles more than just bullion
veryone loves gold coins. The problem of course for most is the cost of assembling anything close to a top quality gold coin collection. In the case of early U.S. gold coins, they are scarce. In some cases they almost impossible to find even in Mint State. That problem of finding Mint State examples continues through
the Coronet Head types produced during the mid 1800s and there are significant rarities as well. If you try the gold dollar or $3 gold piece, there are similar difficulties and even more recent issues can be extremely expensive as is seen by the fact that a Saint-Gaudens double eagle collection now has four coins in it likely to bring $1 million or much more in the
form of the ultra high relief 1907, the 1921, 1927-D and 1933. Looking for other gold collecting options, the only other place many can turn to are gold commemoratives. There in the case of historic gold commemoratives there are not many coins and the Panama-Pacific $50 is going to be very expensive especially in top grades. In the case
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U.S. GOLD COINS
of modern gold commemoratives, while many can afford the collection, there is a reasonable question as to whether you can keep up with the new issues while also acquiring some of the older ones which in some cases are soaring. That area’s potential has been identified by David L. Ganz and Eric Jordan and their new books. Take a look at what they have to say elsewhere in this special online issue of Numismatic News. All things considered, you have to come to the conclusion that there are challenges no matter where you turn. But there is another area to consider. These coins are the American Eagle gold coins issued since 1986. The American Eagle gold coins come in ounce, half-ounce, quarter-ounce and tenth-ounce sizes with face values of $50, $25, $10 and $5. The face values were intentionally placed at well before the value of the metal in the coins so that people would not try to spend them at the corner grocery when they ran short of money. The reason for face value at all is that by having a legal tender value, the round disk becomes a coin rather than a medal. Coins are preferred in the international markets. If you don’t believe that, take a look at American Arts Gold Medallions. With gold bullion in the stratosphere we are now at a crossroads. Can you actually collect coins that are intended solely to serve the investor market? The answer is yes. Collectors will collect anything. However, this can require nerves of steel because sometimes the market gets so crazy
22 PRECIOUS METALS
that coins with mintages of a mere fraction of others trade for the same price. Since 1986 the United States has issued a large number of gold coins priced virtually at their gold value. That’s why the American Eagles are called bullion coins. The Mint issued sold them to its network of authorized purchasers, who then sold them to investors for their metallic value. In some years when demand was high, mintages soared. In other years, when demand was low, mintages contracted. In the long term, these mintages should have an affect on prices. The scarce ones should be more than the common ones. When the price of bullion soars, as it is now doing, nearly all of the coins are treated as just so much bullion. But collectors shouldn’t lose sight of the fact that some are much tougher than others, making for further potential profits when the rest of the market wakes up to that fact again. Understanding what the American Eagle gold bullions coins have to
offer and why they have been overlooked in many cases requires that we consider the situation when they were introduced. For many years Americans had been frustrated when it came to buying gold coins. For decades the restrictions imposed on ownership starting with the Gold Recall Order of 1933 had prevented Americans from buying any gold coin dated after that date. It did not matter if the coin was a Canadian commemorative or an interesting issue of another country, the prohibitions were the law. It might be little remembered today, but it was illegal for Americans to own gold until the last day of 1974. This allowed Americans to purchase modern gold coins without restriction. If you wanted a gold coin containing an even troy ounce of gold in it, it had to be a Krugerrand of South Africa, which was created in 1967 as the first coin made containing precisely one ounce. The U.S. $20 came close at 0.9675 ounces, but that is not what gold buyers of the time want-
ed. They wanted the convenience of knowing that if gold was trading for $1,350 an ounce, that was the value of the gold in the coin. Canada copied the idea in 1979 with its Maple Leaf. Other countries followed. American gold buyers wanted to own American gold coins, but the government was slow and indirect in granting that wish. It seemed actively indifferent to gold investors and their needs. The introduction of the American Eagle gold coins came as something of a surprise then as it represented a complete change in policy. But the purpose was not helping investors so much as attacking the apartheid government of South Africa at the time. It became illegal to import Krugerrands. There is no doubt that the 1984 Los Angeles Olympic gold commemorative $10 was an enormous success and helped to pave the way for the American Eagle program. It was a simple evolution of thinking on the part of officials of the 1970s who initially feared that somehow gold coins would create problems. At least for officials getting to know gold coins in the 1980s was getting to like them and as the fears vanished, eyes were opened to the idea that there was money to be made by producing gold coins. The report of the U.S. Gold Commission in 1982 might have ruled out a return to the gold standard, but it helped open the door to positive thinking about gold. Moreover, if Americans were going to buy millions of ounces of gold every year anyway, it might as well be American gold. By the time the American Eagle
program was introduced in 1986 the public was really way ahead of officials in terms of their view toward gold coins. The general view had changed in the 1970s with rising gold prices. Gold hit almost $200 a troy ounce at the end of 1974, coincident with its legalization. Just three years earlier it had been $35 an ounce, an official price that had not changed since 1934. Americans in large numbers discovered that gold coins were capable of moving in price and they wanted a chance to be in on the action. This attitude was reinforced when gold soared from just over $100 in August of 1978 to $850 in January 1980. That time seems to be very simi-
lar to the present. By the time the first American Eagle gold bullion coin appeared in 1986, the price of gold had settled down to the $400 level and most Americans were already old hands at investing in gold and that probably caused some uncertainty as to what the reception of the United States entry into the bullion coin market would be like. The extent of the American Eagle gold bullion program probably surprised many. The United States not only issued a one-ounce gold coin, but it also issued fractional sizes as well as a one-ounce silver bullion American Eagle. Few countries offered such a selection and the Mint was not finished as it also offered a proof ver-
www.redwhiteandbluecoincatalog.com WWW.NUMISMASTER.COM 23
U.S. GOLD COINS
sion of the $50 and its popularity rapidly resulted in proof versions of the other denominations the following year. Clearly there was at minimum, an audience of collectors interested in proof gold coins. The interest at least on the part of collectors was certainly helped by the fact that someone had an interesting idea, which was that the silver American Eagle would use the A.A. Weinman Walking Liberty half dollar design on its obverse while the gold American Eagles would all feature the famous Saint-Gaudens double eagle obverse and with a Family of Eagles reverse. The lure of having the Saint-Gaudens design on a proof gold coin was too much for many to resist.
While the proofs were sold to collectors, the American Eagles were marketed as bullion coins and as such many collectors didnâ€™t pay much attention to them. What was overlooked by most at the time is the fact that realistically the gold and silver coins of the United States have historically been bullion coins. The price of silver and gold was basically stable and the coins of the United States had a gold or silver value that was very close to their face value. If, however, the price of gold or silver changed significantly then the United States did not change the face value but rather the amount of gold or silver in the coin. In the case of gold the classic example was in 1834 when the amount of gold was reduced slightly with the
24 PRECIOUS METALS
$5 half eagle which was the largest gold coin in production at the time being reduced from 0.258 troy ounces of gold to 0.242 troy ounces of gold. Lest anyone think the change was not needed, the fact is that gold coins had been basically unable to circulate for over a decade prior to the change. If anyone received a gold coin they would usually sell it to a broker and that coin would end up being melted in another country. That is the reason the gold coins of the 1820s are so tough as despite mintages that would suggest they should be scarce, but available many dates especially in the popular half eagle size are almost unknown, with very small numbers having survived to the present day. In fact a very similar situation would happen with silver over time as the amount of silver in the coins was reduced in 1853 and then increased 20 years later, reflecting the price movements of silver. As another example, it is the silver Trade dollar that most directly resembles the modern American Eagle. In 1876 the legal tender status of the Trade dollar was revoked and that meant it was no longer a dollar but rather 420 grains of silver. With the price of silver declining, the Trade dollar which some had accepted as a dollar, was rapidly selling for 90 cents or less. The history of American gold and silver coins did not seem to matter much in 1986 as the proofs would sell to collectors while the business strikes were being sold to gold buyers from all over the world. Like any other gold bullion coin, the American Eagles were not treated
with much respect. The $5 in particular became popular as jewelry while the large $50 one-ounce coins were frequently dumped with no care whatsoever in display cases or store windows. That was in addition to the careless handling that saw coins going from hand-to-hand with no concern about the impact the handling might have on the coin’s grade. At first showing off their American Eagle $50 was more important to most than whether the coin might some day return from the Professional Coin Grading Service or Numismatic Guaranty Corp. with an MS-69 grade. That of course changed. We have already seen proof in that in at least one case a 1998 $50 has been graded at a major grading service as AU-58. It is safe to assume there are many others and possibly even in lower grades which are unlikely to ever be sent in for grading. At least for some years the idea that American Eagle gold coins were bullion coins seemed to translate into a general view that they were all created equally and in equal numbers. Even though there would be sales totals announced at the end of every year, few if any seemed to notice that some years had much higher mintages than others. The $50, which is the most popular size for bullion buyers, was the sales leader and remains that way today. The second most popular size is the small $5 as it is one gold coin virtually anyone can afford. That has also made the $5 popular for use in jewelry although other denominations have been used as well, but not in the same numbers as the $5 and
the jewelry use makes the mintage totals of the $5 potentially suspect as indications as to how many might really be available if there was suddenly significant collector demand. The $25 and $10 generally post far lower sales totals. With indifferent handling and few collectors to save nice examples, there is a situation where the possibility is real that some will turn out to be in short supply. This is not a prediction. It is a fact as a couple dates have already jumped to price levels far above their gold value. A good example is the 1990 $25. It had a mintage of 31,000 pieces – a stark contrast with the largest $25 mintage of almost 600,000. The 1990 is up again to a current listing of $1,450 as opposed to the avail-
able date price of roughly $774. Certainly those paying almost double the gold related price are doing so for a reason and that reason is that 31,000 mintage. The 1991 is even more dramatic with its lower mintage of 24,100. That mintage has produced a price surge to $2,075, making the 1991 at least for now the key $25 American Eagle. A similar situation can be seen with the $10. The sales in 1986 of the $10 were 726,031, but that number had dropped by 1990 to just 41,000, which slipped even further to 36,100 in 1991. Naturally the 1990 and 1991 are tougher than the 1986. However, their current prices are hardly more than bullion value. Smart bullion buyers today might look to purchase the scarce issues for
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U.S. GOLD COINS
the current gold price. The trend is less apparent in the case of the $5 which has seen mintage as high as 912,609 and as low as 165,200. There are a couple dates like the 1988 and 1991 where we are seeing some indication of potentially higher prices, but collector interest in the $5 so far appears to be modest, possibly reflecting the fact that small coins in general have not been very active in recent years. There is another factor as well and that is the mintage totals in the case of the $5 are many times higher even for the lowest mintage dates than they are in the case of the $10 and $25. That has an impact as it means a greater supply. For prices to rise to premium levels the supply must be threatened
and that is far easier in the case of the $10 and $25. That is also potentially the case with the one-ounce $50. The $50 with the highest sales of all denominations naturally has the largest supply available of any specific date. It would be safe to suggest that while the most heavily produced, the $50 also probably has the largest number of coins that do not receive proper care. While that might cause thousands of any $50 date to fall to grades where collectors are not interested, the fact remains that the lowest $50 sales so far were the 2001, which had sales of 143,605, more than 1 million pieces lower than the highest year for sale. Even so, current demand does not appear to be enough to dry up the
Gold Coin Survival Kit It is the belief of some very smart people that with the continuation of printing paper by all governments in the world that all paper currency will eventually collapse against the price of gold. This will lead the worlds governments to restrict gold bullion ownership to its citizens. (thousands of years of history has proven this 100% of the time.) People will have a short time to sell their gold, probably at depressed values. However, there will be some exceptions to be able to own gold, such as gold jewelry, watches and gold numismatic collectible coins. Many of the most popular bullion coins today may be illegal to own based on type date, and premiums. After the turn in date expires, the price of gold will probably be ﬁxed at many multiple times its value. The type of certiﬁed coins we offer here are numismatic and semi numismatic rare coins. The kind that will be exempt, (many grade 70 and mintages under 1,000 pieces) they have slightly higher premiums than common bullion coins and are in short supply. We would like to recommend acquiring as many as you can at this lower price of gold. The premiums will of course soar in value (probably to 100% or higher) upon announcement of these restrictions and the world will rush to acquire these coins and very few will be available at that time or at current premiums. Take this opportunity to check out our inventory. If we can help please feel free to contact us. $25 off ﬁrst purchase on invoices over $200 and free shipping inside the US on orders over $1000.
26 PRECIOUS METALS
supply of the 2001 or any other $50 date for that matter so there are no premium prices for the bullion coins. That could certainly change over time. The situation is different with the proofs. Premiums there come and go. Buyers pay to put them in their Individual Retirement Accounts. Collectors are attracted to issues like the 2006 reverse proof and the availability of new proof issues after what happened in 2009 cannot be taken for granted. Over time there are likely to be dates with special collector value. Generally speaking the probability is that the prices of the proofs eventually will follow very directly their mintages. It will be interesting to watch. Some day many will be as much interested in the mintage differences as you are. When that day comes, they will realize that they missed a real opportunity to acquire a great collection for just a bullion price. The indications are clear based on better $25 and $10 dates that there are some better gold American Eagles that are already bringing prices far higher than their gold value. This trend seems likely to continue after the price of gold has had its day and as more discover that American Eagle gold coins are collection in their own right that many can assemble and enjoy. For those wishing they could have been around to get in on the ground floor for Saint-Gaudens double eagles or other historic coins of the past this is your second and probably last opportunity to really assemble a great gold coin collection.
Are you buying more gold and silver than you were a year ago? Here are some answers sent from our Oct. 19, 2010, e-newsletter readers to Editor Dave Harper. Read more responses at www.numismaticnews.com.
I think you are asking if I am chasing the precious metals, especially gold and silver. I do not chase gold and silver. I am building a collection of coins that I enjoy collecting. Some just happen to contain gold and silver – gold Buffalo and silver Eagle. I do not purchase more (in quantity) than the collection. Thank you for the opportunity to express my thought. — Daniel SooHoo • San Francisco, Calif.
I am buying heavily this year. I did not buy much in the last three prior years. Gold will hit $5,000 plus and silver is certainly going to be at $100 as the economy fails and paper is devalued. —Mark Pollachek • Address withheld
Still buying about the same gold and silver as last on a monthly dollar average. However, I am buying better quality than I did last year. — Mike Gardina • Address withheld
Yes, I purchase 100 to 1 ratio in silver to gold. The rates of returns can easily be seen to justify the move over the past year. —Bill VanSyckel • Address withheld
No, I am not buying more gold and silver than last year. The prices are just too high for me. I’ll wait and see if the bubble bursts again. Then I might get into he market. — Charles Hildebrand • Johnston, Iowa
Yes, I have plowed a sizeable lump into silver coins. I have about six times what I had at the turn of the year. Sorry, I have no confidence in the U.S. economy and it appears to be a “smoke and mirrors” illusion. When it falls, I expect the Japanese economy to go with it. I re-located to Chongqing, China, a year ago. — Francis Petchey • Congqing, China
I sold gold this year and purchased more silver this year than any since 1979. Thank you for asking. — Michael Hassler • Greensburg, Ind. I have slowed or stopped buying gold, but have increased purchases of silver coins – mostly low grade dimes and quarters purchased on eBay below spot. I also purchased some certified modern silver dollars earlier this year. — Michael Chazin • Deerfield, Ill.
Yes I am buying more silver than I did a year ago. — Dave Hed • Address withheld
I am buying silver, but mostly when I find it under melt. And most of the silver I buy are coins that I collect. I don’t consider myself an investor. I do have doubles in silver coins that I use to trade for ones I need. But silver will have to get pretty high for me to sell any. I am, I think, a dying breed. I consider myself a hobbiest. I don’t buy to make a profit, flip or even sell online.
Coins are my hobby and that’s it. When I add a coin to my collection, what it may be worth a week or a year from now never comes to mind. I enjoy building circulated sets. And if I see a coin and like it, I buy or trade for it. By the way the Medal of Honor $5 gold coin is the first gold coin I have seen that I plan to buy. This is, in my humble opinion, a great design and wish the silver coins would have had the same design. I enjoy Numismatic News and look forward to each edition. — John H. Rich • Address withheld Yes, I am buying bars and ingots instead of bullion coins from the U.S.
Mint as the premiums are simply outrageous. I can easily obtain better pricing per ounce of silver at my local coin shops or jeweler. — Robert McKenna Belleville, Mich.
ing at these levels. Now, if it sells off in the next few months... I have not gone so far as to dig out all those old silver Eagles I bought at $4 and $5 each in the 1990s. — Walter Fortner • Milwaukie, Ore.
No, I am not buying more silver or gold. I haven’t bought any of the latter in years. I bought more silver last year than usual, as I just became reacquainted with the Liberty “coin” series from NORFED. For the most part, these items are too far above the silver value to interest me now. I may look to add a silver Eagle or two this year, and I’ll get the silver proof set, but otherwise silver is not that interest-
At today’s record prices there is no way I would buy precious metals. Its just a matter of time until prices fall. Now is the time to sell, not buy! Bill Dwyer • Address withheld What a stupid question for us old collectors. Are you buying gold now? LOL — Randy Ralston No more for now. Waiting to see if we can stop the Federal spending and thereby slow the printing presses. — Dwayne Helmuth
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28 PRECIOUS METALS
About the same as last year — David Pai • Long Beach, Calif. The government will not let silver prices go much higher due to industrial needs for silver. You remember in 1980 when silver rose to over $50? The Feds suddenly called in margin calls and silver went down in three days to wipe out the speculators. This happened two years ago when oil went to $145. The Feds one day said you had to take delivery of the oil barrels and the speculators got out of the market quickly. The big question is what they are going to do to gold speculators. — John R. Blair • Palm Beach, Fla.
COINS WITH POTENTIAL
BY DAVID L. GANZ
Modern Commems Unmined vein of profits? Which is better? An old type coin, a genuine rare coin in very fine condition, that you could buy for $30,500 with a recommended holding period of (say) 26 years and a subsequent selling price of $207,500, or a Morgan silver dollar in MS-64 condition that has a selling price of $76, a holding period of a dozen years, and a resale price of $215? If you picked the first, a 1794 silver dollar in very fine condition, with a pedigree going back to the Philip Strauss collection (Stack’s, 1959) at $1,350—next resold at a 1981 Bowers & Merena sale for $30,500—it’s not a bad choice. (The 1959 to 1981 average annual return is over 15%; the coin was eventually resold in 2007 after an intermezzo at a Stack’s sale for $207,500—for
a 48-year average return rate of a little over 11 percent compounded daily over the period. But that wasn’t the choice. The 1981 to 2007 gain, while a handsome $177,000, measures an average of (compounded) 7.65 percent rate of return on an overall gain of 580 percent. How does that compare with the Carson City cartwheel that sells for a fraction of the price? It turns out the CC King does quite well, thank you. Here’s how it did—a real life choice found in my 1998 book Planning your rare coin retirement (Bonus Books), where the $76 selling price was taken from an advertisement in Numismatic News. The story is amplified in my new book, Rare Coin Investing: An affordable
Way to Build Your Portfolio, just published (2010, Krause, $24.99). The current bid price for an 1882-CC Morgan dollar is $215 (the price on which calculations are based). Change that final number, and the calculations are altered as well. (My old buddy Dennis Baker’s “NumisMedia” lists the fair market value of the 1882-CC in MS-64 at $269. (The results are better—we’ll get to that in a minute). So from $76 to $215 is a gain of 182 percent—and an average rate of return (compounded) of 9.05 percent, which outpaces the 7.65 percent return of the scarce 1794 silver dollar. (The comparable rate of return calculated using Baker’s Fair Market Value ($269) is 11.1 percent (compounded).
COINS WITH POTENTIAL ABOUT THE FORMULA When I started writing about coin prices in the early 1960s, I used a slide rule to calculate the percentage gain. By the time I was out of college (Georgetown University), I had graduated to a calculator, which was still expensive but more precise than the slide rule, which I used with considerable proficiency. For years, I searched for a formula to quickly do compounded rates of
Anyway, having said that, there are lower-priced numismatic rarities today for which the sky is the limit. It is virtually limitless because their relatively modest prices today are going to take a lot to beat and, mostly, because they remain coins that people want to buy. So here’s my list (taken from the new book) which may cause some initial price changes in the general network. It’s where I see the most likely areas of profit in the coming dozen years. As you plan for your rare coin retirement, the three most common areas to consider are singularly under-exploited and presently affords the most potential for upward mobility. The coins are the modern commemorative coinage (1982 to the present), statehood quarters (the extended series of 11 years that includes all 50 states, Washington, D.C., and five territories), mint errors involving contemporaneous coin issues, and the new modern circulating commemorative coins and other items sold by the Mint that include design changes. (This
30 PRECIOUS METALS
return because showing a gain of 182 percent over 12 years (simple rate 15 percent annually) just isn’t real world accurate; in fact it is a compounded rate of 7.65 percent, which you can use as a point of comparison with any other financial calculation. If the world is using Excel spreadsheets, I still use Quattro Pro for Windows, because Michael Haynes (when he chaired the fi-
nance committee of the American Numismatic Association in the 1980s used it and showed me how to). Well, I bought a Quattro manual, and they had an easy formula for compounding, called “@Rate.” The formula: “@rate(end value, beginning value, # of years.” For the 1882-CC silver dollar, that’s @ rate(215, 76, 12). The result is 7.65 percent.
includes the cent, the nickel, the quarter plus all of the new commemorative issue). Some of this is going to be hard and some of it is even going to be counterintuitive, but for these new issues, you need to acquire the object or coin involved in uncirculated condition, rather than a proof. Mint spokesmen will give the opposite impressions and suggest that proofs have a popularity that runs three to one—true enough—but that leaves the uncirculated coins a rarity all their own. Collectors ultimate base value on mintage numbers or survival rates. So if proofs start out with three purchased for
every one uncirculated, you can see that in the long run it is the uncirculated coins that will be the objects of future collector attention. From my desk, the single most undervalued area of American numismatics is uncirculated modern commemoratives. First, look at the evidence which is in chart form. I began keeping this chart when I served on the Citizens Commemorative Coin Advisory Committee, during the Clinton Administration. I kept and updated the records, and from 19931996, gave updated copies to all of my colleagues on the Advisory Committee. Long after leaving the committee—14 years ago—I still update the records faithfully because of the useful information that it provides. Note that in analyzing all modern commemorative issues, the combined number of coins minted is a little over 60 million pieces of which 47.4 million (or 77%) are proof. A mere 12.6 million are struck as uncirculated on average or about 24.8 percent of the pieces coined.
My general feeling is that mintages of less than 50,000 pieces can set up a real score. Here then are my candidates in silver (Iâ€™ve provided total mintage and the breakdown between proof and uncirculated, but the mintage total is compared based on the uncirculated column (marked with an asterisk (*)). Look at the difference between availability in proof and uncirculated. These look like real winners to me.
1996 Olympics Paralympics wheelchair
1996 Olympics High Jump $1
1996 Olympics Tennis $1
1996 Olympics Rowing $1
1995 Olympics cycling $1
1999 Dolley Madison $1
1996 National Community Service
1999 Yellowstone $1
1995 Olympics track and field $1
2000 Leif Ericson
1997 National Law Enforcement Memorial
1995 Olympics Paralympics
1997 Jackie Robinson $1
1996 Smithsonian 150th Anniversary
2001 Capitol Visitor Center
1998 Black Patriots
2007 Little Rock
2002 Salt Lake City Olympics $1
1995 Olympics Gymnastics $1
2006 Ben Franklin old
2006 Ben Franklin youth
1995 Civil War Battle $1
2005 Chief Justice Marshall
2009 Louis Braille bicentennial
COINS WITH POTENTIAL
Look what happens when the gold commemorative coins are also pitched into mix:
1997 Jackie Robinson 50th Anniversary
2000 Library of Congress gold/platinum
1996 Smithsonian 150th Anniversary $5
1996 Olympics $5 Flag Bearers
1996 Olympics $5 Cauldron/flame
2003 First Flight $10
2002 Salt Lake City Olympics
1995 Olympics Stadium $5
1997 Franklin D. Roosevelt $5
1995 Civil War Battle $5
2008 Bald Eagle
1995 Olympics $5 Runner
2006 San Francisco
1999 George Washington
1994 World Cup $5
1993 MADISON $5
1994 WWII $5
1992 Columbus $5
1992 Olympic $5
1991 Mount Rushmore $5
2001 Capitol Visitorâ€™s Center
1989 Congress $5
32 PRECIOUS METALS
These are relatively easy to find. But the best value: do a comparison of gold coin mintages (proof versus uncirculated) and if the price is relatively the same, the uncirculated is the best buy. Here’s an additional list where there is near price parity (the mintages may be a little higher, but there is still great value in these coins):
2008 Bald Eagle
2006 San Francisco
1999 George Washington
1994 World Cup $5
1993 MADISON $5
1994 WWII $5
1992 Columbus $5
1992 Olympic $5
1991 Mount Rushmore $5
1989 Congress $5
1986 Statue of Liberty $5
There are a lot of other coins, rare and otherwise that would qualify —but these are hidden secrets you can extract for big profits. My book mentions many more. Read it and let me know what you think!
MORE ON MODERN COMMEMORATIVE COINS 왘
Find these and many more resources at www.ShopNumisMaster.com RARE COIN INVESTING An Affordable Way to Build Your Portfolio By David L. Ganz
MODERN COMMEMORATIVE COINS Invest Today Profit Tomorrow, Featuring U.S. Coins from 1982 to Date By Eric Jordan, Debbie Bradley, Contributing Editor
COINS TO RETIRE WITH
BY DAVID L. GANZ
Old or new? Profit found in both
This is the year of gold, silver, platinum and other precious metals, as gold nears $1,400 an ounce, silver $25 and platinum $1,800. It is a comeback year for the Dow Jones Industrial Average (with the best September since 1939) is back over 11,000. Without even saying it, those who have discretionary income available to take a plunge in the coin market are jumping back in. It remains a good opportunity for the coin market, as my new book, Rare Coin Investing: An Affordable Way to Build Your Portfolio (Krause, 2010, $24.99) clearly shows. Timing is everything; the book came out on Oct. 2, and is already popular on Amazon.com as a coin investment guide as well as investments overall.
34 PRECIOUS METALS
The 1982 edition of the Red Book, A Guide Book of United States Coins by R.S. Yeoman, had a guest chapter that I wrote entitled “Planning Your Rare Coin Retirement,” which melded together a report by the Boston Federal Reserve Board with a survey done at the behest of Salomon Brothers, then a major Wall Street powerhouse firm. The Fed and Salomon looked at the stock and bond market and the tangible asset market as well, and came to the concusion that stocks were a good buy in 1978. (Put differently, coins were outperforming stocks). They were, and it was. Several years later, Bonus Books contracted with me to write a book by the same title – I always
loved the title more than the book – and in 1997, Planning Your Rare Coin Retirement came out to a giant yawn. Too bad, because that book had dozens of recommendations, many model portfolios, and (if not a theory), then the real thing in terms of advice. Unlike a number of other books that offer glistening generalities of portfolio stuffers, or great rarities that simply cannot be acquired by the many, the theory of Planning Your Rare Coin Retirement was simple: a $10,000 portfolio with a number of selected components that were waiting to be acquired. So that there was no misunderstanding, I price sampled Numismatic News and Coins magazine, and per-
SILVER DOLLARS 1998 TO 2010 Date
1881 1878 1879 1880 1881 1882 1883 1884 1885
S CC CC CC CC CC CC CC CC
Morgan $ Morgan $ Morgan $ Morgan $ Morgan $ Morgan $ Morgan $ Morgan $ Morgan $
MS-63 MS-63 VF MS-60 MS-60 MS-64 MS-64 MS-64 AU-50
$28 $82 $100 $130 $143 $76 $76 $76 $155
$37 $255 $235 $400 $410 $215 $210 $210 $500
haps a few other sources, to see what their selling prices were. There were no “buy gold bullion coins for $200 an ounce” when the market was $335 an ounce. Nothing was fake. Everything was transparent and above board. Although it was modeled after the Salomon Brothers portfolio that Stack’s had assembled for the Wall Street firm, it had fewer preconceived notions. Where Stack’s included no gold coins at all because Salomon wouldn’t let them – they were afraid it would skew the results – my portfolios embraced all metals, gold and silver alike. In keeping with the underlying decision to not emphasize scarce and rare coins that were priced out of range insofar as the average collector was concerned, at least one of the portfolios listed more than 100 gold coins whose average cost in 1997 was $85 a coin (more or less). (That model portfolio, which had dozens of modern gold coins) cost under the $10,000 mark (about $9,400). Want an estimate of what that portfolio is worth this week? That
$9,000 investment of about 100 coins was selling for about $30,000 (which assumes a general markup on inventory of 25 percent over the spot price, and then 15 percent for profit and overhead). Thud, in this scenario, a new Queen Elizabeth sovereign has a retail price of $543, a 20 Franc rooster is a $435 coin, an old sovereign is about $544, and an Austrian ducat is about $250. The original book is now out of print (it cost $13.95 when it first came out); on Oct. 10, Amazon.com had a used copy listed for sale for $40.81. The new volume that Krause published includes the original recommendations, a follow-up (“How’d we
Overall Gain 32.14% 210.98% 135.00% 207.69% 186.71% 182.89% 176.32% 176.32% 222.58%
Annual Gain 2.35% 9.92% 7.38% 9.82% 9.17% 9.05% 8.84% 8.84% 10.25%
do?”) and a profits calculation. My dear friend of more than 40 years, Donald Kagin, saw the manuscript and some of the charts (lots of bling: color everywhere) and immediately asked for copies for some of his customers – and then he asked whether the results since the manuscript was finished (earlier this year) showed a different result. Quickly, I did some calculations, and saw that even with the Dow taking off, rare coins had performed so well over the last cycle that their rate of return was astonishing – justifying the position of the Federal Reserve Bank of Boston publishing the Salomon Brothers data in 1978,
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COINS TO RETIRE WITH
and the use that others gave. The gold coins run from Australia to Yugoslavia, with a lot in-between – some are well circulated, others strictly proof condition. Most are lightweight; Surely the increase in the price of gold is one reason why these coins have shot up in value. But so is the relatively light mintage that each has. There are a total of 226 line items on the spreadsheet that I keep for the Rare Coin Retirement book, but that’s not the whole story. The foreign gold coin line, for example, is a single line that says: Foreign Gold Coins (various, 100 coins, each coin at $85. Back in 1998 I also liked silver dollars, though none that I picked werre MS-65 coins. (They are good shots, but simply cost too much in a portfolio that was limited to $10,000). But let’s take a look at a few of them and see what the results are today: The results are interesting. The 1881-S Morgan dollar has the lowest gain in the period and coins chosen. But even for an MS-63 (which is common for this coin), it does well over-
Typical socio-economic data about coin collectors/investors • Gender – Male (92 percent) • Married – 72 percent • Attended college – 75 percent • Own home – 84 percent • Median age of collector: 63
all. Take the scarce dates (1879-CC and 1885-CC, for example) and they do well in circulated condition, too. There were a dozen common-date $5 gold coins minted prior to 1909 which I listed at $144 on acquisition in 1997 as MS-60 coins. Today, bid is at over $420 a coin, a compounded gain of more than 8.5 percent annually. When I worked as an assistant editor of Numismatic News almost 40 years ago, we constantly took surveys of readers to see why they collected coins, what attracted them
Aikahi Aloha Coin & Stamps Collector/Hobbyist/Dealer for U.S. & Foreign Coins & Currency We buy & sell coins/currency, gold/silver/platinum jewelry & stamps. P.O. Box 309 Kailua, Hawaii 96734 (808) 391-4597 email@example.com Member ANA & HSCDA
FOR MORE INFORMATION www.aikahialohacoin.com
36 PRECIOUS METALS
• Average household about $87,000 • Average spent on coins each year: $10,500 • Average number of coins in collection: 10,800 • Average value of numismatic collection: $128,000 • Average number of coins purchased in the past year: 900
to the field, and what we could do to pique their interest. This was also true when I was on the American Numismatic Association board of governors, during my service on the Citizens Commemorative Coin Advisory Committee and in other capacities. What my colleagues and I found in exhaustive studies of the psychology of collecting is that people collect coins for many different reasons. The surveys found that people collect because they are fascinated with history, they love the brilliance of the design, they have an underlying fascination for the politics that created the coinage, they are gratified by the commemorative nature of what the mints produce and they like the ability to show off their knowledge about these things to their friends, neighbors and fellow collectors. Then each of the groups that I was a part of that was making the inquiry asked the follow-up question: what do you read in the newspaper or
periodical first? I always hoped that it would be the “Under the Glass” column that I started writing for a small monthly magazine in 1965, and which still runs in Numismatic News. No such luck. The answer was always the same: the price guide that the periodical had showing its readers the state of the market. The people surveyed wanted to know what their coins were worth. Here are some of the statistics that form the basis of my underlying thoughts. It summarizes my experience covering the nascent coin market and then the growth industry that it became. It also summarizes the experiences that were polled when I was on the board of the ANA, as the lawyer (general counsel) to the Professional Numismatists Guild, as a founding board member (and counsel) to the Industry Council for Tangible Assets (since 1983), as a member of the Citizens Commemorative Coin Advisory Committee, and as a lawyer in New York City with a significant practice dependent on offering of advice that draws on this. It’s not the questions or answers from the surveys, but the impressions and trends that are the bulwark of my philosophy of collecting and investing. Each aspect of this counts in taking either a contrarian view, or one which you think will lead the herd. So here is a summary of key analytical data and points from all the interchange with collecting investors:
• The average collector spends $2,500 annually maintaining and expanding his collection. • Prior to 1999, and the introduction of the state quarter program, most collectors (95 percent) were men • Prior to the state quarter program, there were about 3 million coin collectors in the United States and perhaps 200,000 serious coin collectors in the U.S – a thin market uder the best of ciurcumstances. • Post 1999 and the introduction of the state quarter program, the U.S. Mint says that between 120 and 150 million people collect coins (most of them collecting state quarters) • Today there are probably more than 300,000 serious collectorinvestors, as reported in a remarkable article that escaped general notice: Donald O. Case, “Serial Collecting as Leisure, and Coin Collecting in Particular,” found in Library Trends magazine, vol. 57 No. 4 (Spring 2009). Then look at the demographics of the hobby. Though they change a bit from year to year, at the same time many of the categories are remarkably similar. • Collects popular series such as silver dollars (59 percent) • Collects other silver coins (50 percent) • Collects gold coins (25 percent) • Collects modern U.S. 1964-date (45 percent) • Collects other things: Antiques (28 percent), old books (12 percent), Toys (11 percent); Autographs (5
percent). So, to see where I believe the coin market is going in the next dozen years, I commend my new book to you. Not just for gold and silver, but for copper, nickel and minor coinage, and platinum as well. There’s a full chapter on platinum and a number of coins on the recommended list. Here’s a teaser and an extract as well. Taking all platinum Eagles 19972008 and sorting them yields a surprise: virtually the entire series is scarce. The largest mintage of any coin is around 133,000, but low mintage is around 6,310 pieces. A full 25
COINS TO RETIRE WITH
coins are under 20,000 mintage and even the tenth ounce, which has a high metal value, is a low mintage coin. Here they are with the mintages under 35,000 ranked in order. One drawback: the high price and great track record of platinum
as a metal makes collecting these costly, but also an investment not only in numismatic rarity, but also in platinum, in drawing a line at 35,000 mintage, these are attractive coins for any rare coin retirement portfolio.
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38 PRECIOUS METALS
So, read the book to find out the picks of 1997 (some of them repeat in 2010), see what the picks are this
year, and see if the results this time are anywhere near as good for the other coins chosen.
PROTECT WHAT’S YOURS
BY ERIC JORDAN
Keep taxes at bay Treat coins as heirlooms While visiting Colonial Williamsburg recently I stopped in the silversmith’s shop while he was forming a 7-ounce silver cup. He explained to the tourists that in the 1700s this cup contained about three weeks’ wages in silver and the finished product sold for four weeks’ wages. A complete 12-piece silver set with plates, utensils, decanter and serving tray could easily represent five to 10 years’ wages! Simply put, the family’s silverware was an enjoyable form of savings that represented a significant portion of the family’s net worth. No wonder people used to be concerned about who got Aunt Beth’s silverware. It was an important form of intergenerational wealth transfer. So, too, is your coin collection. Most coin collectors are upper middle class or better and are facing a serious intergenerational wealth transfer problem over the next 30 years. Let’s take a look at why you might already be in the right place and how you can fine-tune your efforts in this regard.
Why Heirlooms Are Needed Successful individuals are facing a pair of long-term threats to their family’s fiscal health. One is the overwhelming unfunded Federal li-
abilities owed pending retirees with a present value of well over 60 trillion dollars, according to estimates based on Congressional Budget Office data. The other is the fact that the lower 75 percent of U.S. households have saved an average of only $15,000 in 401(k), Individual Retirement Account and Keogh retirement plans combined and the same groups total financial assets only average $35,000, according to the Employee Benefit Research Institute. EBRI also indicates that about 82 percent of the nation’s wealth is concentrated in the top quartile of U.S. families. Unfortunately, the July 2010 International Monetary Fund report indicated that our financially troubled federal government is going to need to impose an immediate and permanent 80 percent increase in taxes beyond what they collect in a typical year to prevent our debt to Gross Domestic Product ratio from expanding uncontrollably. Upper middle class and wealthy families will be called on to make a major contribution to this fiscal gap and the math is simple. Most working professionals are lucky to see 70 cents on the dollar from the time it is earned to the time it ends up in their check-
ing account. If that dollar is saved then, it is stacked on the top end of our net worth and it is likely to get hit for another 55 cents on the dollar through inheritance taxes. Total marginal tax rates on upper middle class and wealthy families could easily hit 70 percent from the time a dollar is earned by a head of household to the time it is passed to a younger family member if it is not handled correctly.
PROTECT WHAT’S YOURS
The key to successfully navigating this situation is to focus on the continuity of family wealth not personal net worth .
How To Pick Them One method of legally avoiding this eventuality is to consistently “sluff off ” the upper portion of the household’s net worth into highly liquid invisible heirloom assets that do not create taxable events for an extremely long time, have long appreciation cycles and can be given to younger family members under uniform gift acts. But which alternative assets should we consider and what useful rules of thumb should we apply? Strangely enough the U.S. Treasury has unintentionally given us some first class pointers on its
40 PRECIOUS METALS
public affairs website regarding what we should be interested in. They state: “Precious metals, precious stones, and jewels constitute easily transportable, highly concentrated forms of wealth. They serve as international mediums of exchange that can be converted into cash anywhere in the world. In addition, precious metals, especially gold, silver and platinum, have a ready, actively traded market, and can be melted and poured into various forms, thereby obliterating refinery marks and leaving them virtually untraceable.” – Proposed Rule, 31 CFR Part 103, RIN 1506-AA28, Page 5 Occasionally collectors on the Professional Coin Grading Service message board will make the com-
ment that high dollar collections can end up at the pawn shop and that the best thing to do in regard to your collection is sell it for cash or gold and jointly gift it to the grand kids at $25,000 a year under the uniform gift acts. Another frequently suggested option is write a check to responsible young family members, have them cash it and progressively buy family coins from the parent or grandparent’s collection every year. Put their name on the lock box and keep the keys at home. No real cash changed hands and the family collection remains. Exactly how you accomplish this is based on many variables and you may need to talk to your tax specialist but the point is “sluff” the net worth off your books and
build “cost basis” on theirs and do it every year. Family heirlooms that are being used as intergenerational wealth transfer mechanisms need to have durable long-term value. Unfortunately, sky-high collector premiums over intrinsic value are based on very thin markets that are directly dependent on the currently existing structural preferences of collector’s sets and the disposable income of U.S. citizens. If anything were to happen to either one over the younger family member’s lifetime, the heirlooms’ importance as a long-term family asset is compromised. This is why many prefer to stay completely way from numismatics when managing family wealth, but this is likely an error. Just as the silverware example in the opening was an improved form of the base material, so too rare coins are a superior form of holding material that has been regarded as money for thousands of years because they have dual supply and demand curves. An excellent example of this type of favorable dual structure can be seen in high bullion content modern American Eagles with low mintages. Most attractive classic key date coinage issued in the last century have matured into the 50 to 100+ times melt value range and have become almost completely divorced from the value of the metal they are struck on. Key date modern silver, gold and platinum Eagles that are still in their infancy can be purchased for two to three times their intrinsic value in many cases. The graph illustrates the
approximate price behavior of a high intrinsic value key date as its series progresses from infancy to full maturity. Constant dollar price maturity tends to show up within 30-50 years after a series is no longer available from governmental inventory and sometimes much sooner. When the rarest coin in a large series or a coin with a rare design (type coin) can be picked up for less than two to three times melt you are essentially acquiring a highly liquid, low risk art form that has the potential to display white hot appreciation during the growth phase of its life cycle. By the time this process is complete its normal to see the four rarest coins in any given set to represent over 50 percent of the entire set’s value and that is why it is good policy to stay away from coinage new or old that is trading for more than about 1.5 times melt if it is common in its set. If you are going to pay over twice melt you might as well be buying the lead coin of a young set. Some examples of great modern American Eagles trading at low
markups over melt that are still in their infancy are in the accompanying chart. The main point of all this is to couple young family members youth with the long appreciation cycle that rare coinage can create without absorbing sky-high collector premiums. What other potential family heirlooms can we buy that enjoys the benefit of having been struck on the materials humanity has regarded as money for most of recorded history and enjoys a relatively bullet proof value floor as a result? A rare silver, gold or platinum Eagle collection has a number of favorable characteristics that seem make them useful for this intergenerational asset transfer: • Is not someone else’s liability and as such cannot be defaulted on. • Is not impacted by inflation or foreign investors willingness to hold dollars. • Can appreciate in constant dollar terms for 30-50 years as the series mature.
PROTECT WHAT’S YOURS
• Can be held almost indefinitely. • Is not subject to property tax. • Offers excellent liquidity. • Serves as an invisible form of wealth. • Can be exchanged in large or small increments. • Is an enjoyable form of long-term savings. Alan Greenspan made the comment in his book The Age of Turbulence that “How governments finesse the transfer of real resources from the shrinking shares of their populations who make up their work force to a growing retirement population is likely to be the defining question of the next
42 PRECIOUS METALS
quarter century.” 401(k), IRA, Keogh and insurance policy shelters all have the same set of problems; they are high profile targets with huge monetary value, owned by a narrow voting block, accessible by amending currently existing tax law and the cost of enforcement is negligible. Whatever high potential, high intrinsic value family heirlooms you choose to transfer under the currently exiting laws are effectively off the table. Systematically move as much as you can off the table between now and 2017 when the CBO models indicate the real federal bills begin to come due and our deficits are no longer discretionary but structural.
SNAPSHOT OF HISTORY
BY DAVID L. GANZ
1794 dollar Coin price moves ever higher
Looking at the coin market in 2010 finds it ahead of much of the rest of the economy, but somewhat stalled out on supreme rarities. It is a fluid market, pressing upward, but investors as well as serious collectors looking at big ticket items are comparing rates of return with the private sector and tamping down enthusiasm for significant gains in seven-figure items. With the Dow having had its best September in three generations, and gold and silver making a reprise star performance, rare coin purchases still remain part of discretionary spending, not a primary investment vehicle. There are still substantial gains â€“ and profits remain in the offing â€“ thanks to the desire of serious buyers of rare coins to stake out a hedge against the economy, and the pressure on the stock market that daily has some senior analysts shaking their heads. The Dow Jones can jump, or decline, 100 points in the time it takes to bat an eyelash. Over the past 20 years, I have written a number of articles on the 1794 dollar because it is a bellwether of the state of the coin market as a whole, and has prices at all levels designed to appeal to, and be examined by, the serious collector. The 1881-S silver dollar is a similar bellwether, but at a different price level and in a very different way. Fewer than 2,000 pieces of the 1794 dollar
SNAPSHOT OF HISTORY
were made, and about 130 of them are known today. Martin Logies has written the definitive study on the condition census, and should be commended for the scholarship and the work that has gone into identifying these coins. The late Jack Collins and the late Walter Breen had done a genealogy, a magnificent 260page opus (plus bibliography and appendix) that traces the pedigrees of many (but not all) specimens. The Collins-Breen book, alas, is an unfinished work in progress, and is difficult to use – in large measure because it lists coins by condition as Breen saw them (and Collins edited); that, it turns out, is something of a mystery to the uninitiated in grading. Modern or more current interpretations of the state of preservation make finding any one coin awkward and time consuming. My first article about coin grading appeared in Numismatic News nearly 40 years ago, and I quoted the old master Abe Kosoff, a well known dealer who presided from the 1930s to the 1980s. The article spoke about grade-flation, where a Sheldon grade (on the 1 to 70 scale) seemed to magically change for the better. Kosoff frequently utilized his column to fight a then-pervasive practice of calling coins MS-70 in newspaper advertisements. His columns are representative, and point up the problem in the early 1970s of lack of uniformity of meaning. There was no definitive reference point – no fixed statute or standard
44 PRECIOUS METALS
for the seller, or the buyer to refer to; only guideposts, of which the Sheldon guide, and its genetically altered clones, were several. In that 1971 article that appeared in Numismatic News, it was noted that grading did not become even remotely standardized in verbiage until the 1930s. Quoting Kosoff, the article stated “if a coin has never been in circulation, regardless of its appearance it is uncirculated ... [yet] there is a widespread band that it can travel on.” Four years later, in 1975, my twopart article on grading appeared in Numismatic News stating that “most collectors today realize that grading has changed over the past 20 years-sliders, particularly, have moved to higher grades than the previous generation would have allowed.“ The article goes on to state that “whatever standards are devised [by the ANA] they must be flexible enough to meet the needs of tomorrow.”” The article then goes on to quote an interesting example, from an old auction catalog issued by A. Kosoff Inc., the same person initially placed in charge of setting up a prescribed set of grading standards by American Numismatic Association then-President Virgil Hancock. The year was 1963, and an auction sale of the Numismatic Association of Southern California. The Lahrman Collection was being sold by Kosoff and contained a 1793 large cent (Sheldon variety 11-A), quite a scarce piece.
A generation earlier, the piece was in the Oscar J. Pearl Collection sold by Numismatic Gallery. (Abe Kosoff was a partner in Numismatic Gallery with Abner Kreisberg). Kosoff was more of a salesman than a cataloger – though his sales were renowned – but was competent enough to be thought dead-on when it came to later grading controversies. When the coin was sold in the Pearl Collection in 1944, it was cataloged F-12 (meaning Fine-12). Utilizing the same Sheldon numbering standards in 1963, cataloger Abe Kosoff, after first noting its grade in the Pearl sale, stated: “it is Fine-15.” The article noted, at that time, “obviously, standards indeed changed.” Well, the same thing is evident with 1794 silver dollars (Though the problem is not unique to early-dated coins – it affects all of them). Take one example, a 1794 dollar that Heritage cataloged as VF-25, and which brought a hefty price of $126,500, which is good value in this market. Looking at the identical coin, Breen and Collins call it Fine-12. Jess Peters sold it at an August 1974 sale preceding the 1974 ANA convention grading it “very fine” with a “strong date.” It brought $20,000 and a headline on Page 3 of Numismatic News. From there, it was sold as “choice very fine” in the RARCOA section of Auction ’81, and then on to Bowers & Merena’s sale of the Ebenezer Saunders collection in 1987 (where the cataloger, Q. David Bowers, called it “F-15 to F-20”).
PCGS has an opinion as to the grade: VF-25. Regardless of the grade, the price is in order with other VF 1794 dollars: Here’s a listing of more than 50 different sales of 1794 dollars described as very fine (or numerical equivalent) starting in 1883: • 1883 Breitton sale Jan. 1883 VF (to Chapman 6-27-1889) $160 • 1889 S.H. & H. Chapman, 6-27-89, VF $ 100 • 1937 J.C. Morgenthau & Co. sale of 12-21-1937 VF $250 • 1941 Mehl (Dunham) VF-30 to Heritage 9-02 $218 VF • 1950 Numismatic Gallery (Kosoff) Menjou collection, VF [VF-25] $510 • 1956 New Netherlands 48th sale (Nov.-- 24, 1956) to Kagin’s lot 608 VF-25 T. James Clarke 625 • 1959 Stack’s Philip Straus VF-30 PCGS $1,350 VF-30 • 1973 Superior Gilhousen collection a second specimen VF $12,500 • 1975 Superior ANA Convention to Heritage 7-94 VF-35 $1,000 VF-35 • 1975 Superior ANA Convention VF-20 $9,500 • 1978 Quality Sales VF-20
• 2002 Heritage 9/02 PCGS VF-30 x-Henry S. Adams (Edward Conan, Oct. 30-31/Nov. 1, 1876), lot 341, $80; to Henry Ahlborn; Major William Boerum Wetmore (Samuel Hudson Chapman, June 27-28, 1906), lot 178, $110; Waldo Charles Newcomer (B. Max Mehl); William Forrester Dunham (B. Max Mehl, June 3, 1941), lot 1033, $217.50; unknown intermediaries until John Koppell consigned the coin to the Brooks Collection (Bowers and Merena, June 11-12, 1989), lot 141, $26,950. From the Albany Collection. $92,000 VF-30 • 2004 Heritage Auction 352, Lot 6299 Saturday, Aug. 21, 2004 VF-25 PCGS $131,100 • 2004 Heritage VF-20 7-27-04 $39,100 VF-20 • 2005 Heritage VF-20 (NCS) repaired lot 30264 $43,125 VF-20 • 2006 HERITAGE 4/06 NGC V-25 x-Jules Reiver Collection $126,500 VF-25 • 2007 HERITAGE FUN VF-25 x-James Kelly (2/1964), lot 1028;
• 1980 B&R Garrett 3-27-1980 VF-30 $40,000
Stack’s Robison Sale (2/1982), lot 1852; A & B Coins-Bob
• 1981 Bowers & Merena McFarland VF-30
Cathcart; Superior’s H.W. Blevins Sale (6/1988), lot 3574;
(x-1959 Straus) $30,500 VF-30 • 1981 AUCTION ’81 Lot 147 (RARCOA) to Bowers 1987 x-Jess Peters 1974 $ 28,500 VF-25 • 1984 Walter Nichols (Bowers) VF $19,800 • 1987 Bowers and Merena (11/1987), lot 368 (from Auction ‘81) VF-25 $19,800 • 1988 Auction ’88 Superior x-McFarland, Strauss VF-30 $27,500 VF-30 • 1994 Heritage PCGS VF-35 $33,550 VF-35 • 1994 Heritage Auction 122, Lot 7083 Saturday, July 30, 1994, VF-35 PCGS $33,550 • 1997 Superior Gainsborough Collection x-Auction 88, McFarland VF-30 $39,600 • 2001 Heritage Auction, Lot 3413, July 17, 2001 VF-25 PCGS $68,000 • 2002 Bowers & Merena VF-20 x-Quality Sales 1978 $66,700 • 2002 Heritage Auction 284, Lot 6459 Saturday, Feb. 23, 2002 VF-20 ANACS $48,300 • 2002 Heritage Auction 300, Lot 7732, Sept. 28, 2002, PCGS VF20 $60,375
Jules Reiver (Heritage 1/2006), lot 23464. From The William Luebke Collection. $126,500 VF-25 • 2007 Stacks x-Superior Gainsborough, Auction ’88 VF-30 $207,500 VF-30 • 2007 Heritage Auction 422, Lot 4941 Saturday, Jan. 6, 2007 VF-25 NGC $126,500 • 2007 Heritage Auction 422, Lot 1020 January 6, 2007, VF-35 NGC $207,000 • 2007 Heritage FUN VF-35 NGC x-Peter Mougey (Thomas Elder, 9/1910), lot 940, $150. $207,000 • 2008 Heritage Auction 1108, Lot 800 June 2, 2008, VF-30 PCGS $161,000 VF-30 • 2008 Goldberg Pr- Long Beach sale sharpness of VF-30 weakly struck Feb 2008 $75,000 VF-30 • 2008 Goldberg Pre-Long Beach sale sharpness of VF-20 weakly struck repaired May 2008 $70,000 • 2008 Stack’s 73rd anniversary Sale Oct. 22, 2008, details of VF-20 $97,750 • 2009 Heritage VF-30 (January 2009) $143,750 • 2010 Heritage ANA VF-25 x-Auction ’81, Bowers 1989 $126,500
SNAPSHOT OF HISTORY
Let’s look at the overall view of the 1794 dollar starting with its sale by Jess Peters in 1974, and finally resold by Heritage at the 2010 ANA in Boston:
VF 1794 COMPOUND CHANGE DATE
Jess Peters ANA Sale lot 904
$28,500 Choice VF
AUCTION ’81 lot 147 (RARCOA) to 1981 Bowers 1987 x-Jess Peters 1974 Bowers and Merena (11/1987), 1987 lot 368 (from Auction ’81) Bowers & Merena Brooks Collection 1989 lot 142 Fine-12 to 2010 ANA 9.69%
Heritage ANA VF-25 x-Auction ’81, VF-25
2010 Bowers 1989
46 PRECIOUS METALS
Overall, it has done well over the last 36 years even when it went down during periods of market unrest or coin recession. The 2010 price seems about right given the current international economic climate. But there were two more 1794 dollars in the auction sales marketplace around the ANA convention in Boston this year: Stack’s had one in Fine-12 with an illustrious pedigree dating back to a Kreisberg-
FOR MORE INFORMATION WWW.SAHARACOINS.COM
Cohen-Schulman sale of 1964, and earlier a 1913 sale by Chapman. Bowers & Merena, at a pre-ANA sale, resold a specimen that had been in the Cardinal collection (and since required) in MS-64. The Fine12 specimen brought $92,000; the MS-64 went for $1,207,500. Sizzle. Here’s how the Fine specimen is cataloged:
• 1913 Arthur Sargent Collection, Samuel Hudson Chapman, June 20, 1913, Lot 107; to 1964; 2010 $60 very good • 1964 Quality Sales-KreisbergCohen & Schulman(3/20/64) Brand-Lichtenfeld Coll $ 1,550 VG-7 • 2010 Stack’s F-15 (x-Quality Sales 1964; VG-7) x 1913)
Specializing in U.S. Gold, Early Type, Key Dates and Registry Sets
FOR MORE INFORMATION WWW.YELLOWRIVERRARECOINS.COM
$92,500 F-15 The rate of annual return (19132010) is 7.8 percent; from 1964 to the present, it is around 7.5 percent annually. (Note that the coin was called very good in 1913 and 1964; its mature grade today is Fine-15. Then take the monster coin: the MS-64 whose pedigree history is also revealing. Its history shows that the rare coin market moves up and down. A $2,000 selling price in 1945 (at the time of the F.C.C. Boyd’s World’s Greatest Collection Sale by Kosoff, but not at the sale – the coin is a duplicate MS-64) to $1,800 at the 1949 ANA auction sale. (During the same time frame, the Dow Jones Industrial Average went from 179 to 199 (yes, three digits – an 11 percent change). This listing is not complete, but it clears up the mystery of how
SNAPSHOT OF HISTORY
Boyd’s MS-64 coin seemed to be in two places at once (there were two of them). In his classic Silver Dollar Encyclopedia, Bowers (p. 170) lists the Boyd specimen (PCGS -63) but cites the World’s Greatest Collection (Boyd, 1945, lot 1) as well as Eubanks,1973 Quality Sales, and Somerset. Thus, it is confusing to look at the coin and its gains. There are some “offerings” of the coins that the Collins-Breen manuscript (printed by Kolbe as a book) lists, such as a Bowers & Ruddy Galleries Rare Coin Review No. 41 (advertising it at an optimistic $295,000, unsold). Stack’s sold it on a fixed price list for just shy of $1,600 in 1950, and from there, it was off to the races. What it all shows is that the rare coin market sometimes moves up, sometimes down, and sometimes sideways. Also that it is important to look at the research source, not to mention doing your homework. Bowers suggests that there is near universal agreement today that there are probably no more than 120-130 coins, many of which have been sold multiple times, in the whole corpus of 1794 dollars. He also quantifies the auction population census: good (30), VG (13), fine (21), VF (34), XF (15), AU (4), MS-60 and above (12). Total : about 102. So the 1794 dollar shows a coin market that is still fluid, gaining ground over time but not rising straight up.
48 PRECIOUS METALS
Read news about the precious metals market from the publishers of Coins & Numismatic News magazines.