Citations wanted on the reason for face values on bullion

Can people here help me fix the deplorable Wikipedia article on non-circulating legal tender?

I can guess at the reasons for putting a nominal face value on bullion coins (protection under anti-counterfeiting laws, maybe favorable tax treatment?), but I'm missing any references like the kind a good Wikipedia article should have.

 

Log in or Sign up to hide this ad.

Mind linking the wiki article? It'll make it easier for us to look!

 

http://en.wikipedia.org/wiki/Non-circulating_legal_tender

 

Yup, that article is a mess. Good luck cleaning it up. And that is a good question. Why do they have a denomination? The simplest answer would be "because congress said so". The wise ass answer would be "because if we didn't put a dollar value on the coin everyone would realize it's just a medal and we couldn't sell proofs for a handsome profit."
​

 

Good luck with that. that page was posted by Aidan Work, one of our most notorious banned members!

 

I read somewhere that countries do this to make the coins more marketable worldwide. If they are legal tender then they are money and not subject to certain import/export laws. I could be wrong but you could take 200 Once ounce gold eagles out of the country and not be violating any laws because it would not be over $10000 face.

Best I could find quickly.

http://bullion.nwtmint.com/articles_faq.php

 

Now that is one messed up compilation of misinformation. The whole dang thing needs to be deleted and re-written......

 

A number of years ago when silver was selling for about $6-$7, I called Scotiabank and asked someone at their bullion desk about the $5 face value on the Maple Leafs and whether the coin could be cashed in for face value in the event silver fell below $5. They told me that it could not. The $5 value was put on the coins to enable Canada to export them to certain countries without paying certain taxes, but that the bank would not honor the face value, only the bullion value.

I don't know if what Scotiabank said was right, or if it applies to ASEs.

 

But I figure a good Wikipedia article should say something about the "why" as well as the "what", and anyway it shouldn't be limited to US coins. The legislative history behind the statute might answer my questions but I'm not willing to do *that* much research.

 

This smacks in the face of "legal tender." If the face value isn't the value, how is it legal tender. If nobody will honour the face value printed on the coin, back by a government, what good is anything that government says or does. Yeah, "it's legal tender that has a $5 face value, back by the good faith of our government, but I'm only giving you $4, because that is the current value of silver." HUH????

 

I can't document what I was told by Scotiabank. I was surprised by their comment, which is why I posted it here. Perhaps someone else has better information. Perhaps Canadian law in connection with maple leafs is different from US law in connection with ASEs.

 

This kind of reminds me of the Trade Dollar and the goings on back in the 1870's......

 

That's so weird they'd do that. It's like saying a quarter is worth less because the melt value is lower. Total disregard of what the government issued it to be :rolling:

 

They might have said it because it is true in Canada. I haven't seen any documentation either way. This should be a matter of fact, not any of our opinions. At the time, I couldn't verify it as true or untrue.

 

I think this is the relevant statute:
http://laws.justice.gc.ca/en/showdo...l=L&statuteyear=all&lengthannual=50&length=50