I've been a collector of classic U.S. coins for some time, and although I have some SAE and GAE proofs, I had never really followed their value. Ten years ago, it seemed that proofs weren't worth more than the bullion coins, besides a 10% premium or so. And two days ago, I received a Buffalo as a gift and was astounded at the prices proofs are going for now. $50 for SAEs? $1500+ for GAEs? Is it just me, or is this a new development? Proofs have the same metal value as bullion, so why should the gold bubble be affecting premiums? I am confounded.
Im on the same boat as you! It happened quick! Do you think the premiums will crash- or is this going to be longstanding?
For modern commemoratives, the proofs are currently more popular. In the long run the premium will probably disappear.
Please forgive my ignorance. But what exactly does the proof version have that the non-proof version does not have? Thanks!
The question proposed is an age old question that will always continue to present itself as long as the mint continues to manufacture proof and bullion coinage. I have been wanting to tackle this question for a long time, but never had the time to sit down and complete the answer. I now have a few moments. As a collector and non collector alike, it is very easy to overlook the subtle differences that separate a 1oz American Eagle/Buffalo bullion coin from its proof counterpart. The most obvious difference is that one is a bullion coin and one is a proof....translation....one is shinny and the other is not. More importantly, more attention is paid to the preparation of the dies and striking of the coins for a proof than a bullion coin. This process in itself translates into higher prices through all the additional hours spent on the manufactuing process. Proof coins are better handled and taken care of then their bullion counterparts. Next is the packaging. Bullion coinage often comes in tubes that hold 20 or so coins or in individually sealed plastic holders. Each proof coin is packaged separately. Like it or not, someone has to pay for this. The mint being a for profit organization certainly is not going to pay for it, so that cost is past onto its customers. Then comes the distribution aspect of the coins. There are only about a dozen or so certified groups that the mint sends their bullion coins to for distribution. There are tens of thousands of customers that the mint sends their proof coins to. Now, as a customer we pay for these shipping costs, but not entirely if you think about it. There is a cost that is associated with paying the workers to box each and every coin that goes out. Least we not forget about the marketing aspect of the proof coins. The US Mint does not market the bullion coins because they do not sell the bullion coins to the public. Now, I do not live in an area where there is a lot of marketing for the US Mint, but I understand that in larger cities there is quite a bit. Also, the mints website most likely falls under their marketing budget. These are a few of the components that I understand and accept as contributing to the overall cost of our coins. More work and effort goes into selling a proof coin than a bullion coin and that cost is passed on to the customers and rightly so. As a for profit "company" I would never expect them to eat these costs. Hope this helps. I wanted to get into more detail, but the wife wants to go to Olive Garden and who am I to say no. LOL!
It's a good question. Proof coins are made with special dies that are polished to a mirror-like finish. The coins are minted using special hydraulic presses that operate at slower speeds with more pressure than regular business strikes. I think they may also be struck twice to achieve the mirror effect in the fields. I also believe the planchets are prepared with a special wash.
Well, I understand why the mint would sell the proof versions for a premium, but I don't understand why SAEs are blindly selling for $50 a pop on the market. I think I've been picking up mine from the mint for about $30? According to the blue book (and accounting for spot price), they're worth far less. Same goes for the gold eagles. Why is a 4-piece gold proof set going for upwards of 3k? It just doesn't make sense. Is it speculation at work? A bubble in the market for bullion proofs? Or has it always been like this, and I just haven't been paying attention?
It's what ever the market will bear and whatever the public is willig to pay. Folks want to pay $50 for silver american eagles all well and good. I can do better elsewhere.....
Well a proof walker or indian head usually sells for more than a BU. I guess people are will to pay more for the beauty of it.( also of course in that case a lower mintage). I would hope that most people are not buying the proof ASE as a bullion play. I'm curious to see what the UHR Eagles bring after they stop minting those tommorroow. It is a 1 year type with a fairly low overall mintage. Lack Lack
GDJMSP made a post on this thread (it's the 4th post of the thread) it's a good read with alot of useful information http://www.cointalk.com/t84716/
