The situation with gold and the Sarasota Coin Show

I went to the Sarasota coin show yesterday. It was interesting to see how the numismatic gold coin market is going. The short answer is that it almost isn't. One dealer put it quite simply with respect to St. Gaudens $20 gold coins. If it's not graded MS-66, it's selling for bullion.

I bought a couple gold coins, like lemming racing toward the cliff. The first one was this 1900 $5 gold in NGC MS-63. This piece was struck with somewhat worn dies, but is very high end for an MS-63. It the old days, it might have been cracked out, but it doesn't make any sense. It would have to get an MS-65, more like MS-66 to make the cost of doing that worth it.



My second purchase was the 2007 Thomas Jefferson First Spouse $10 gold coin. I bought this piece for 1% over melt, actually a little less that that because the dealer knew me and gave me a break. This piece grabbed my interest back in 2007 because of Draped Bust design on the obverse. It has long been one of my favorites. Unfortunately the piece the mint sent was was infected with die polishing disease and looked awlful. I blew it off when bullion went up. This is the Uncirculated version.



The same dealer was selling certified examples in "First Strike," MS or PR-70 holders for 2 and a half percent melt. Unfortunately this type was no among the pieces he had with him.

Some people are happy about this situaiton with precious metals, but I am not. In the old days, a middle class collector could buy a common date $20 gold piece for type for anywhere from $400 a while ago to $1,600 later. Now you might buy it for melt or close to it, but it's over $4,000. The numismatic market for these coins is dead, unless incomes go way up, which would be driven by a lot of inflation, or the gold market collapses. Either way is ugly.

 

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I wholeheartedly agree.

 

I agree also!

 

I totally agree. It is irritating to me that at shows all the customers now look at anything precious medal on a dealers table as bullion coins.

I do own some historic gold coins that are now worth more melt than what I paid for them. When it comes time to sell will there be a premium? I hope so but don't know how it gets back to that point.

 

The grading companies seem like they're tough on these. I got this one at a show back in April of 2011 for $500 in an old PCGS slab with a white label. Said it was a MS-60. lol I crossed it over with NGC that year and they upgraded it to a MS62. I'd give it a 63 at least. But, it is what it is and the dollar value again doesn't change much in that grade range so don't care. It's a very attractive orange gold with high luster. The $$ it took to get it in 2011 doesn't seem as painful as it would be now. It wasn't that big of a deal at the time to me.

I always had a feeling as time went on that gold was going to get out of reach for the average working man and I wasn't far off. Your report and everything we're seeing proves the numismatic market has zero effect on the gold market and is just along for the ride as the dollar gets inflated to oblivion.
The solutions (cuts) were too painful before and only get more painful to implement as time goes on. In WWII they sold war bonds to somewhat finance the extra costs (gave the appearance of fiscal responsibility) and that was a major burden on people. After the 70s, cash was unleashed. Social security dumped into the general fund budget. Gold standard gone. I'll make a bold prediction that golds never coming down. At least not to early 2000 levels ever again. I'd be happy to be wrong.

 

Wages will have to catch up, if they ever can.

 

Most all of my gold is historic gold. Most was purchased twenty years ago or better so regardless I am to the good….. But I doubt any of my historic gold holds any numismatic value over and above melt. I am a type coin guy so I don’t really hold rare dates….. Heck I remember looking at $400.00 St. Gaudens wondering if I would ever have that kind of money. If I were a young collector now, I wouldn’t even dream of owning a $4000.00 St. Gaudens. And silver is following suit. Remember five dollar silver dollars?