Why do some collectors turn there nose up at bullion coins such as ASEs & Gold Eagles

Discussion in 'Coin Chat' started by Luke1988, Sep 14, 2010.

  1. Luke1988

    Luke1988 New Member

    I know that the main purpose of these coins are for bullion investing, not for collectors but to call them pure bullion and not consider them a legetiment coin is going a bit to far especially since that main purpose of business strikes are not for collectors ether but they seem to have no problem collecting them?
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  3. coleguy

    coleguy Coin Collector

    I don't think most "turn their nose up" at bullion coins as much as they get tired of trying to explain to bullion collectors why they just wasted 2K on an MS-70 bullion coin that does not, nor ever will have the same numismatic qualities about it that will justify that price across the board. They look on them as non-numismatic, because in essence they are. True, they are legal tender, but they aren't made to circulate.

    Myself, I like ASE's as a store of silver in convenient form. I buy the cheapest I can because silver is silver is silver when it comes to bullion and grade doesn't effect the price at the refiner.
  4. Luke1988

    Luke1988 New Member

    What does the fact that the coin was not made to circulate have to do if the coin is a numismatic coin or not? And there are plenty of people that wast money on modern high grade coins made for circulation. see this thread

  5. coleguy

    coleguy Coin Collector

    Did you happen to also notice that coin did not sell? The numismatic reference gets used as a way to differentiate those coins collected in the classic sense, such as regular circulating monies, and those that aren't, such as bullion. That's not to say if you want to focus your collecting on bullion, or even south Pacific shell currencies, that you don't attribute numismatic value to your collection. But in the overall community the opinions may differ from your own.
  6. krispy

    krispy krispy

    What is not popular now often tends to be worth looking into for a time later when it becomes popular. Bullion coins also have notable low mintages that may work in their favor. Just because the Eagle program has been around for 23 or so years and there are scads of bullion versions of these coins minted there may (will.) come a day when the design is changed or the program ceases to exist as it has been known, from that point on some sort of collector base and values will arise since the supply is fixed. It's a minority view amongst collectors who point to the bags of Morgans that laid around for decades... But it shouldn't be entirely overlooked.

    Now on the idea that bullion coins don't circulate, this is not entirely so. They do change hands and go in and out of ownership from one investor to another. Many of those holders of these coins may not care for these bullion coins in the way a collector would, this narrows the supply of (applying numismatics) high grade bullion coins which may one day, in the future, appeal to collectors. So there are things to consider about bullion.

    Someone recently suggested ordering a custom Dansco album to collect bullion 1/10th oz. AGEs and noted the amount of money wasn't too obscene to put together a whole set of these coins. I think it will look great when that collector finishes his set. Collect what you like not what the market tells you is collectible, valuable or otherwise. It takes innovators to drive the popularity of things. Look at toned coins. In the past it was pretty clean(ed) white coins that were more popular and many toners were dipped or worse. Now toned coin collectors abound and a whole niche category within coin collecting has developed. At the very least, you are wrong and no bullion coin collectors ever emerge for the Eagles and Buffaloes and you are left with the invested intrinsic value of the metals.

    I also caution you against paying high prices for slabbed bullion unless you are certain of the deal you are getting. There are a lot of dealers that hype high MS graded coins with prices that are astronomical. You should do better applying those funds to entire untouched tubes of Eagles to judge and submit for grading on your own such coins if you require that, plus you will end up with more bullion holdings otherwise lost to profits made by the dealers. I buy bullion as an investment with the above in mind. I appreciate the designs of the ASE and AGEs, AGBs and in my care, they are looked after as one of my numismatic coins are. Just some thoughts...
  7. Mark Feld

    Mark Feld Rare coin dealer

    In order to avoid possible confusion, that type of activity (change of ownership) does not equate with "circulate", as it is commonly used.
  8. coleguy

    coleguy Coin Collector

    Good point on the mintages, Krispy. I've seen a few dealers haul off five gallon buckets of ASE's to the refiners, so you have to assume even the low mintages are lower than many think now.
  9. abe

    abe LaminatedLincolnCollector

    One reason, I don't appreciate a collection going on a roller coaster ride...
  10. sgiorgis

    sgiorgis Student of Numismatics

    Nice one, Abe! I Agree!!!
    But I still collect them!
  11. krispy

    krispy krispy

    Even numismatic coins experience casualties on hyperbolic roller coaster rides or potentially in desperate times if individuals must foresake the numismatic values for intrinsic ones.
  12. krispy

    krispy krispy

    Yes, in an extreme numismatic definition this is primarily true. Govt. issued bullion coins, minted as such with denominations, have every potential to circulate and stories have arisen of ASEs being turned in and resold to customers at face value from banks while rare occasional others have been plucked from shop tills. Even so, bullion coins are not idle and certainly are circulating amongst investors, changing hands at coin shows, even being used as money by collectors trading Eagles (for instance) for other numismatic coins. Many dealers sell off-quality Eagles and other bullion coins at less of a mark up over spot price. While they sell those for less of a mark up, new and or bright clean BU bullion coins from previous years are being sold for more. This implies to some degree the mindset of buyers are focused not just on bullion/intrinsic aspects but that they are already responding to eye-appeal. The potential for bullion coins, I primarily mean ASEs and govt. issued bullion, as numismatics grows with time. I understand it's not a popular opinion to hold.
  13. blsmothermon

    blsmothermon Member

    I agree with Krispy. I know they aren't bullion, but my sister witnessed a man purchase a bill of groceries with 20 1987 Proof Constitution Commems. She worked there and picked up one at face which is now in my collection. The rest were purchased from the register at face by the other employees and customers. It is possible for them to reach a bank or store, but rarely do they "circulate". Rather, they get instantly bought up and stashed.
    The problem I have with any US coins as bullion is my definition of bullion. Bullion, to me, is precious metals whose value lies SOLELY in their intrinsic value as a precious metal. American coins of any precious metal (Platinum, gold, or silver) are all affected by condition, mintage, date, type of strike, etc. This breaks the definition of bullion to me. I know there are some dealers who buy and sell them similarly to the prices of bullion, but in most cases I would define them as numismatic items and not bullion. Despite the Mint's definitions, if the market handles them more like coins than bullion, then they are coins.
  14. GDJMSP

    GDJMSP Numismatist Moderator

    But do you realize that people like you, meaning those who think of the bullion coins as you do, are a very small minority ? 9 out of 10 dealers, maybe 95 out of a 100 dealers look at them as nothing but a chunck of bullion. If offered to them for sale they will give you not 1 cent more than they would for a gold or silver bar of the same weight.

    And the same is true of most coin collectors. To them they are not coins. They are nothing but NCLT - non circulating legal tender, a chunck of bullion.

    People often make the mistake of think that just because they think a certain way, that everybody else thinks the same way they do. Well they don't. As I said - you are in a very small minority.
  15. playin4funami

    playin4funami Junior Member

    I agree most dealers I know could care less about date shape or form as long as it is bullion thats all it will be to them,and me too. my favorite silver is the kind I buy cheap and sell for a decent profit, ase's rounds,bars whatever,it's all silver to me.
  16. edssco

    edssco Junior Member

    I have over 100 of them (ASE) they great ,I like them better than a silver art bars etc. because they are made by the US govermont so I know there real and if I have to barter with someone they know there real .But with a bar or round how does one know its .999 silver or what it is .That is also why I like pre 65 USA silver coins too!
    In this rare case I do trust the goverment.
  17. Evom777

    Evom777 Make mine .999

    I think one of the biggest traps anyone can fall into is getting into graded ASEs.....Many dealers will shy away from buying them (at a reasonable rate)....even if they are low mintage dates. (and I don`t blame them either) As far as them and other bullion changing hands....It`s actually happening more and more. I have seen much more bartering going on in the last couple of years than ever before, in shops, shows and coin clubs.
  18. edssco

    edssco Junior Member

    Think about this sombody wants $100 dollars for something well I can say I will give you $5 for it , that is 5 USA dollars in ASEs ,they might take it .I want to be able to buy gas and food if I have to if we have a bank holliday or the like
  19. Evom777

    Evom777 Make mine .999

    Most of the bars and rounds are legit....Most art bars are listed in the Guide to Silver Art Bars books. (I think there`s 6 editions now) Many of the older so called mints are documented and known as well.....But I can understand where You`re coming from.
  20. edssco

    edssco Junior Member

    I have about 30 rounds and 10 rolls of war nickels I am going to sell those on ebay.
    I am sure silver will go higher but at $20 for spot is a good time for me to get rid of
    this type of silver as I got it for cheap
  21. Luke1988

    Luke1988 New Member

    I bet those dealers only hold the view of SEA's as being pure bullion when they are on the buying end but if you tried to buy SEA's from them for the same price they sell bullion they would laugh at you. To me the statement "non circulating legal tender" can also apply to any commemorative, proof or satin coin and even Morgans and trade dollars.
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