Premiums on Double Eagles and Gold Coins Collapsing

They can be both. Why not use collector knowledge to pick out the best bang / potential appreciation for the buck?

At the big gorilla bullion store near me (Dallas Gold & Silver exchange), there's a tray of Morgan dollars. You can pick out your own (avoiding the culls & selecting better dates / mint marks) or you just ask an employee to grab a number of them off the top of the tray.

Even if you're making a silver play, wouldn't you rather pick the best of what's available? Yet I see people come in and buy Morgans by volume all the time.

 

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I don't know your criteria for purchasing Gold Eagles, but where I used the same minimum past purchase criteria, acquiring >1 coin/week, now only 1 NGC MS70 was available/purchased!

 

premiums are a fact of life, its best to shop around for the best deal on both the purchase and buy backs as dealers will generally try and low ball you just tell them no thank you and move on.

 

I don't think there was/is any "historic ratio" that is tradeable or investable.

It's a quirk of a gold price that was controlled and both metal prices have experienced bubbles. But gold has deeper investment demand.

 

I'm not fixated on anything and certainly not a profit.

Just trying to see what a rising gold price means for the pricing of the coins many of us look at. If gold is headed towards $5,000 then it has big implications for many coins we purchase.

 

The “16 to 1” ratio was branded into people’s heads for a long time, perhaps because of the 1896 presidential campaign, but there is really no magic relationship between the values of the two metals.

 

Without massive inflation, which those who are rational would never want to see, the $5,000 gold price would knock out just about every purely numismatic collector.

 

Yeah, and I worry that we'll lose a lot of desirable coins to melting pots, as we likely did when silver spiked around 1980 (and in the spikes since).

 

I understand HOW the price is changing but I don't understand WHY it is changing.

If an MS-65 1924 Saint sells for $2,400 when gold was $2,000....why doesn't it sell for either $3,400 when gold is $3,000 (fixed dollar premium of $400).....or $3,600 (20% percentage) ?

For some reason I'm having trouble comprehending, the premium dissipates as the price of the underlying gold content goes up.

In the past, the premium disappeared -- pre-1933 gold traded at bullion melt -- at the grade where the supply exceeded demand from Registry and Type collectors. At that point, the only buyers were the investment crowd who would pay basically the price of gold...MAYBE with a tiny premium in the LSDs.

Now ? The premium is disappearing at levels which were clearly never considered coins for the investor crowd before. Another year or two and MS-66 commons might be trading flat to gold or at a paltry premium !!

 

JM, we may find out.

I think we'll be there in the next 5-10 years.

 

I believe you're creating a fantasy world where you'd like an illusion to appear! I personally as a buyer, use criteria similar to AI which constantly evaluates the certified Gold market for buys, not seeing your illusion.

I'm a buyer for quality U.S. Gold coinage, not finding ANY under-valued certified coinage, there's a difference between purchasing and believing, are you a buyer or a dreamer?

I know of several dealers that constantly advertise coins that they haven't, and will not accept my offer to purchase!

However, you may be seeing Gem over-graded coins that wouldn't be that grade for me.

I've shown top-tier certified Gold with MS67 grade having appreciable bag-marks and rub on the devices, without luster, dings in the fields, rays.

JMHO

 

All I am saying is that while the ABSOLUTE price of a common Saint has gone up with gold at $3,000.....the premium you USED to pay has disappeared. MS-64's basically trade for melt. MS-65's have a premium of 5-10%.

Articles by long-time dealers and collectors seeing what I am seeing, IM....premiums disappearing up through MS64/65 now have to goto MS-66 to see decent premiums for 1908 NM and 1924 (and even those reduced from a year or two ago).

Again, it's in the official prices and many are seeing these prices...other forums noting it and having discussions.....Jim Bisognani and Jeff Garrett discussing it in their NGC columns.

 

Each time the gold price goes up by another $100, you knock out more numismatic buyers. Most collectors are on a budget, and the additional money to pay for the bullion eats into that.

I don't know about most of the collectors here, but I have think twice before I lay out $5,000. I want some rarity for that kind of money, not a common date St. Gaudens $20 gold.

 

Wow!, you've sold an old lawyer!
Which 2 MS64 or MS65 teen PCGS Saints can you send me from your hoard, at the prices you've quoted?
I really don't want to know what others might state, you're the Objective Seller!
If I weren't a collector, I'd ship 2 certified PCGS Saints USPS for $20!
I've perfect (not even a neutral over decades) feedback.
Please send payment method/address by P.M.!
Thanks for the affirmative enlightenment!

 

Again....I think if we head DOWN from $3,000 gold (as we have done in the past following big rises) the old pattern repeats.

However....if not....folks may get acclimated at these levels. Once upon a time....$500 gold was unheard of to folks used to buying DEs at under $100 and then...following a big rise....$250-$300 still getting 1 ounce commons.

But if gold flatlines at $5,000 and that is the New Normal...you're gonna have to ante up to get rarity.

Right now, I think collectors got "used to" $2,000 gold and NOT $3,000 gold. Therein lies the problem.

 

Well, I'm not a seller but I see plenty of MS-65 Saints trading for < $3,300 on HA, GC, Ebay, etc. Even saw a 1928 MS-65+ sell for $3,500, all-in.

 

You've made absolute statements, promising certain products at a specific complete sold price, that I believe is stated as your fantasy price, which I will accept/purchase!

I will trade 16 quantity 1/10oz certified authentic Uncirculated Gold coins in their boxes!

I spend appreciable time notifying Sellers of the legality in making "bait and switch" offer statements to possible Numismatic Neophytes who waste their time when illegal advertisements are too legally be removed.

There are many posts on this site related to the frustrations of buyers trying to acquire stated available authentic product.

I know what's available/where, as I TRUST, but VERIFY!

I've now ordered from you, stated product, regardless of current location!

 

The point is collectors only have so much money PEROID. Unless inflation pushes up incomes to cover $5,000 gold, which would not be a good thing IMO, they will simply be priced out of the market.

 

I haven't made "absolute statements" or made offers to sell or other actions regarding "fantasy prices", IM.

I'm just stating where the market is. Just check the sales prices last night on GC for commons in the MS-64 to MS-65 grades.

If you see prices other than what I cite, please post. Just because I'm not making a market in those coins doesn't mean my observations are wrong.

 

No arguments, JM.

The key going forward is obviouly the gold price and whether it spikes and then falls back sharply (the experience in the past)....or whether we continue to stair-step it and go up...consolidate...go up...consolidate.

They say that the market likes to do what will hurt the largest number of participants. Right now, that wouldn't be a sharp drop in the price of gold...but a slow rise from here and/or a flatlining...followed by another 10-15% rise later in 2025.