Saturday, June 24, 2006
New Gold Coins In Demand
The Virginia Pilot has this report on the new gold coin. "It took more than two hours of phone calls on Thursday, but Don Leneski finally placed an order with the U.S. Mint for 10 of its American buffalo gold coins. 'I started calling at five minutes before 12, and I got through at 2 o’clock,' the Virginia Beach resident said. 'I can understand that they were busy, but not that busy.'"
"The Mint, which began selling the gold coin on Thursday, said it has limited production of the 'proof' version to 300,000 coins. These have a finer finish and are aimed at collectors. The Mint is producing another version for investors that will be available through coin dealers, banks, brokerage firms and investment firms."
"The Mint acknowledged Friday that phone orders were especially heavy Thursday but said proof versions of the new coin were still available. The Mint had encouraged prospective buyers to be persistent when placing orders, spokesman Michael White said."
"The coin has attracted attention because of its 99.99 percent purity and its design, which was based on the 1913 buffalo nickel. The price for the proof version is $800. The cost for the version aimed at investors will be pegged to the price of gold and include a service charge."
"Leneski expressed frustration that the Mint’s Web page for ordering coins online wasn’t operating Thursday, a day when demand for the page would be especially heavy. White, the Mint spokesman, said the page for online orders became inoperable because of heavy usage and a technical problem."
"Bill Jones, owner of W.T. Jones Coins & Investments Ltd. in Chesapeake, said he wasn’t surprised that prospective buyers had difficulty placing orders with the Mint on Thursday. 'In my experience, they are pretty well swamped' on the first day that any new coin becomes available, he said."
"Jones said he probably would buy one or two of the coins but planned to wait a few days before placing his order."
"The Mint, which began selling the gold coin on Thursday, said it has limited production of the 'proof' version to 300,000 coins. These have a finer finish and are aimed at collectors. The Mint is producing another version for investors that will be available through coin dealers, banks, brokerage firms and investment firms."
"The Mint acknowledged Friday that phone orders were especially heavy Thursday but said proof versions of the new coin were still available. The Mint had encouraged prospective buyers to be persistent when placing orders, spokesman Michael White said."
"The coin has attracted attention because of its 99.99 percent purity and its design, which was based on the 1913 buffalo nickel. The price for the proof version is $800. The cost for the version aimed at investors will be pegged to the price of gold and include a service charge."
"Leneski expressed frustration that the Mint’s Web page for ordering coins online wasn’t operating Thursday, a day when demand for the page would be especially heavy. White, the Mint spokesman, said the page for online orders became inoperable because of heavy usage and a technical problem."
"Bill Jones, owner of W.T. Jones Coins & Investments Ltd. in Chesapeake, said he wasn’t surprised that prospective buyers had difficulty placing orders with the Mint on Thursday. 'In my experience, they are pretty well swamped' on the first day that any new coin becomes available, he said."
"Jones said he probably would buy one or two of the coins but planned to wait a few days before placing his order."
# posted by Ben Jones @ 11:44 AM 
Comments:
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It's a nice looking coin, but I can remember seeing many Mapleleafs that were dinged and scratched. Pure gold is sorta soft.
Yes, I'll stick with my Eagles, thank you very much!
p.s.: John in VA, still lurking? I'm still planning on continuing my series, but have just been busy as hell (which is, of course, a good thing). Sales, eh? I'm an IT mercenary.
p.s.: John in VA, still lurking? I'm still planning on continuing my series, but have just been busy as hell (which is, of course, a good thing). Sales, eh? I'm an IT mercenary.
The proof coin, like all collectible coins, actually has three contributors to its value:
1) The base metal (1 oz gold)
2) The face value ($50 currency)
3) The collectible aspects of it (demand, mintage, quality, etc).
I think you'll find that #3 tends to dominate with most coins over time, if they are collectors grade. Ironically, when (1) is hot (like gold is now), people overbuy the coins, depressing the value of (3) since a lot of them end up on the market. However, 20 years from now, gold may not have moved much, but (3) will have moved quite a bit. The return of gold coins as collectibles has mirrored the average growth rate of collectibles rather than the average growth rate of gold.
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1) The base metal (1 oz gold)
2) The face value ($50 currency)
3) The collectible aspects of it (demand, mintage, quality, etc).
I think you'll find that #3 tends to dominate with most coins over time, if they are collectors grade. Ironically, when (1) is hot (like gold is now), people overbuy the coins, depressing the value of (3) since a lot of them end up on the market. However, 20 years from now, gold may not have moved much, but (3) will have moved quite a bit. The return of gold coins as collectibles has mirrored the average growth rate of collectibles rather than the average growth rate of gold.
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